Weedmaps will no longer list unlicensed dispensaries by the end of the year

Weedmaps, the platform that lists cannabis dispensaries in the United States, will now require all new cannabis stores in California to provide their state license number, and all existing advertisers will need to add a license number to their account by the end of the year. The same requirement applies to businesses using its wholesale system, point-of-sale software, and online ordering system.

This decision clarifies a promise the company made three weeks ago without specifying a deadline: to stop allowing unlicensed businesses on its site. It marks a significant change for a key player in the industry as California continues to grapple with the the illicit cannabis market, which still outpaces the legal sector despite its strong growth, and against the backdrop of a health crisis caused by a thinner used in THC cartridges manufactured for the black market.

Weedmaps was launched in 2008 to promote dispensaries and delivery services within California’s vast network of medical cannabis businesses, most of which are unregulated. After the Legalization of cannabis in California in 2016, the company has continued to allow the publication of advertisements for unlicensed businesses.

Weedmaps CEO Chris Beals said the company had long considered blocking unlicensed businesses from the site but had been held back by concerns about the lack of medical cannabis available statewide.

«A large part of our founding mission and a large part of our philosophy revolves around the medical benefits of cannabis,» he said. «We are very concerned that large areas of the state do not have access to it.»

More than a year and a half after cannabis was legalized in the state, more than 70% cities and counties in California still ban cannabis dispensaries. It is estimated that about one-third of residents would have to travel at least 60 kilometers to find a licensed dispensary.

Chris Beals said that Weedmaps also had reservations about blocking access to businesses that were technically illegal but were still working to obtain a license.

«Frankly, a lot of people were going to be left behind, and they hadn’t done anything wrong—except, I think, for lacking the capital needed to pay millions of dollars for a license,» he said.

Since Weedmaps allows third-party users to post messages directly on its site, the company asserted that it was protected by a federal law—Section 230 of the Communications Act (Decency Act) – which prevents technology platforms such as Facebook and Google from being held liable for user-generated content.

In the second quarter, Weedmaps spent more than 100000$ to lobby against a bill that would have authorized the state attorney general, district attorneys, and city prosecutors to impose fines on online platforms that display advertisements for the gray market cannabis industry. The bill was not passed, but its author, Blanca Rubio, warned her colleagues.

«Instead of trusting a company with a track record of advertising for illegal businesses, the Legislative Assembly should pass strict laws that will protect consumers and promote the legal market,» she said.

When asked about the bill, Chris Beals dismissed the idea that Weedmaps’ policy change would have any impact on the size of California’s illicit market.

«Ultimately, the only way [to limit] the size of the illegal market is for the industry and the government to work together to ensure that a sufficient number of licenses are issued,», said Chris Beals.

Weedmaps said it would now focus its efforts on streamlining licensing processes in the states and across the United States, as well as on supporting its recently launched social equity program.