A New Law Could Allow Oregon To Export Cannabis To Other States

Faced with a significant cannabis surplus, a new law in Oregon could ultimately enable business owners to export pot to other states.

Kate Brown, Oregon’s Democratic governor, has signed Senate Bill 582 into law, which allows the state to negotiate and enter into agreements to ship its marijuana off to other states—a practice that is still barred under federal law.

The bill is one of two newly signed laws designed to combat the over-saturation of marijuana in the state. The other measure, SB218, allows the Oregon Liquor Control Commission to “refuse to issue production licenses…for an amount of time that the commission determines necessary,” based on supply and demand.

The two new laws are a byproduct of Oregon’s nascent recreational cannabis industry, which was ushered in after voters approved a measure legalizing pot in 2014. More specifically, the laws are a direct response to the absence of restrictions on the number of cannabis licenses issued in the state, something that distinguishes Oregon from other placed in the U.S. that have also ended marijuana prohibition. 

The reason, according to Denver attorney Vicente Sederberg, was Oregon’s desire to welcome pot dealers who had worked in the black market into the newfound legal marketplace.

“They put out advertisements, they did a whole ‘go legal’ campaign to attract Oregon cannabis growers to the legal market, and it worked. People jumped on board,” Livingston, who provides counsel to cannabis businesses, told the Los Angeles Times. “They wanted to make it as easy as possible to make those businesses become legal and licensed.”

According to the Oregon Liquor Control Commission, the state’s recreational market had “6.5 years’ worth of theoretical supply in licensees’ inventory accounted for and contained,” as of January 2019.

In the case of SB582, however, Oregon officials will have to await action in Washington, D.C. before the law helps ease its pot glut. That’s because the federal government—despite the raft of changes to laws at the state and municipal level—still strictly prohibits interstate transfer of marijuana.

The law allows the governor to enter into an agreement with another state for  “[c]ross-jurisdictional coordination and enforcement of marijuana-related businesses authorized to conduct business in either this state or the other state” and “[c]ross-jurisdictional delivery of marijuana items between this state and the other state.” 

But crucially, the law states that it will become “operative” only when “[f]ederal law is amended to allow for the interstate transfer of marijuana items between authorized marijuana-related businesses” or the “United States Department of Justice issues an opinion or memorandum allowing or tolerating the interstate transfer of marijuana items between authorized marijuana-related businesses.”