DC to crack down on marijuana ‘gifting’ stores

Regulators in Washington DC will start cracking down on gray-market marijuana “gifting” stores, as they’re known, beginning next month.

According to DCist, the city’s Alcoholic Beverage Regulation Administration (ABRA) will begin inspecting such stores for “health code, tax and licensing violations” with a new Joint Cannabis Task Force comprised of multiple agencies.

The crackdown could have a significant impact on DC’s thriving cannabis gray market, which popped up in the wake of adult-use legalization for possession and consumption in 2014. A formal regulated industry in the district has been blocked by Congress ever since.

Also legalized at the time was the practice of “gifting” marijuana from one adult to another, which gave rise to overpriced mainstream goods such as T-shirts, which are accompanied by cannabis goods.

The city’s medical marijuana businesses – DC has seven licensed MMJ dispensaries – claim the gray-market operators are breaking the law and represent unfair competition, DCist reported.

But the gifting operators – dubbed “I-71 stores” after the initiative that legalized marijuana in the district – say they’re in compliance with relevant city codes.

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But an ABRA news release warns that “businesses in violation may be subject to a fine or other enforcement action permitted by the statutory authority of each respective enforcement agency.”

This is the latest in a string of attempts by city authorities to rein in the gray market, DCist reported.