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Our attorneys stay on top of changes in legislation, agency regulations, case law, and industry trends—then craft timely legal alerts to keep clients up to date on legal developments important to their business.

September 7, 2021

Gifting Cannabis in New York State

The Marijuana Regulation and Taxation Act (MRTA), signed into law on March 31, 2021, allows for the possession and use of cannabis in New York State. However, unless you are a registered medical marijuana patient in New York State, the purchase and sale of cannabis is illegal.

Recently, consumers have been encountering stores that purport to gift cannabis in exchange for the purchase of a legal product. For example, if someone buys a $50 T-shirt, they will receive free cannabis.

Is this legal in New York State?

The MRTA allows for the transfer of cannabis for no consideration between adults 21 years old or over.1 However, it is still illegal to grow cannabis in New York State.2 There are also limitations on the amounts of cannabis an individual can possess. An individual may possess up to three ounces in public and, once home cultivation is allowed, up to five pounds in a personal residence.3 Criminal possession of cannabis can range from fines to a class D felony for possession exceeding 10 pounds.4 Criminal sale of cannabis can range from fines to a class C felony for unlawfully selling cannabis in excess of 100 pounds.5

Anyone who is the owner, lessee, or occupant of any structure that knowingly permits the cultivation, processing, distribution, purchase, sale, warehousing, or transportation of illicit cannabis in excess of the possession limits under the NY Penal Law, is guilty of a violation.6 The importation of cannabis from other states is strictly forbidden under both the MRTA and federal law.

Additionally, all transfers of cannabis, whether gifting or sales, must be to persons over 21 years old (except for medical cannabis by a medical cannabis licensee). A sale to someone under 21 years old will result in a class A misdemeanor, regardless of the quantity sold.7

If you are convicted of a misdemeanor or felony under the MRTA, you cannot apply for a cannabis license for at least one year.8

With NYS Governor Hochul’s statements that she will be moving forward with OCM appointments soon, there may be explicit guidance on this subject. Until that time, there are substantial risks, including criminal penalties, surrounding businesses that gift cannabis to consumers as part of a commercial transaction.

Barclay Damon’s Cannabis Team will continue to closely monitor developments pertaining to the MRTA’s rules and regulations. If you have questions about the MRTA, please contact one of Barclay Damon’s cannabis attorneys.

If you have questions regarding the content of this alert, please contact Jason Klimek, Cannabis Team co-leader, at jklimek@barclaydamon.com, or another member of the firm’s Cannabis Team.

1 NY Penal Law § 222.05(1)(b).

2 NY Penal Law § 222.15(9).

3 NY Penal Law § 222.05(1)(a).

4 NY Penal Law §§ 222.25–222.40.

5 NY Penal Law §§ 222.45–222.65.

6 NY Cannabis Law § 136(5).

7 NY Penal Law § 222.50(2).

8 NY Cannabis Law § 137(1)(e)–(f).

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