Michigan Administrative Code › Department - Licensing and Regulatory Affairs › Marijuana Regulatoty Agency › MARIHUANA LICENSES › Section R. 420.1 - Definitions

Current through Vol. 24-12, July 15, 2024
Rule 1.
(1) As used
				in these rules:
(a) "Acts" refers to the
				medical marihuana facilities licensing act, 2016 PA 281, MCL 333.27101 to
				333.27801, and the Michigan Regulation and Taxation of Marihuana Act, 2018 IL
				1, MCL 333.27951 to 333.27967, when applicable.
(b) "Agency" means the marijuana regulatory
				agency.
(c) "Applicant" means a
				person who applies for a marihuana license, subject to paragraphs (i) and (ii)
				of this subdivision:
(i) For purposes of this
				definition, an applicant includes a managerial employee of the applicant, a
				person holding a direct or indirect ownership interest of more than 10% in the
				applicant, and the following for each type of applicant:
(A) For an individual or sole proprietorship:
				the proprietor and spouse.
(B) For
				a partnership and limited liability partnership: all partners and their
				spouses.
(C) For a limited
				partnership and limited liability limited partnership: all general and limited
				partners, not including a limited partner holding a direct or indirect
				ownership interest of 10% or less who does not exercise control over or
				participate in the management of the partnership, and their spouses.
(D) For a limited liability company: all
				members and managers, not including a member holding a direct or indirect
				ownership interest of 10% or less who does not exercise control over or
				participate in the management of the company, and their spouses.
(E) For a privately held corporation: all
				corporate officers or persons with equivalent titles and their spouses, all
				directors and their spouses, all stockholders, not including those holding a
				direct or indirect ownership interest of 10% or less, and their
				spouses.
(F) For a publicly held
				corporation: all corporate officers or persons with equivalent titles and their
				spouses, all directors and their spouses, all stockholders, not including those
				holding a direct or indirect ownership interest of 10% or less, and their
				spouses.
(G) For a multilevel
				ownership enterprise: any entity or person that receives or has the right to
				receive more than 10% of the gross or net profit from the enterprise during any
				full or partial calendar or fiscal year.
(H) For a nonprofit corporation: all
				individuals and entities with membership or shareholder rights in accordance
				with the articles of incorporation or the bylaws and their spouses.
(I) For a trust
:
trustees, any
				individual or body able to control and direct the affairs of the trust, and any
				beneficiary who receives or has the right to receive more than 10% of the gross
				or net profit of the trust during any full or partial calendar or fiscal year
				and their spouses.
(ii)
				For purposes of this definition, an applicant does not include:
(A) A person who provides financing to an
				applicant or licensee under a bona fide financing agreement at a reasonable
				interest rate unless the person exercises control over or participates in the
				management of the marihuana business.
(B) A franchisor who grants a franchise to an
				applicant, if the franchisor does not have the right to receive royalties based
				upon the sale of marihuana or marihuana-infused products by the applicant who
				is a franchisee. Nothing in this subrule shall be construed to preclude a
				franchisor from charging an applicant who is a franchisee a fixed fee. As used
				in this definition, the terms "franchise," "franchisor," and "franchisee" have
				the meanings set forth in section 2 of the franchise investment law, 1974 PA
				269, MCL 445.1502.
(C) A person
				receiving reasonable payment for rent on a fixed basis under a bona fide lease
				or rental obligation unless the person exercises control over or participates
				in the management of the marihuana business.
(D) A person receiving reasonable payment
				under a licensing agreement or contract approved by the agency concerning the
				licensing of intellectual property including, but not limited to, brands and
				recipes.
(E) A person who receives
				a percentage of profits as an employee if the employee does not meet the
				definition of "managerial employee" and the employee does not receive more than
				10% of the gross or net profit from the licensee during any full or partial
				calendar or fiscal year.
(F) A
				person who receives a bonus as an employee if the employee is on a fixed wage
				or salary and the bonus is not more than 25% of the employee's pre-bonus annual
				compensation or if the bonus is based upon a written incentive/bonus program
				that is not out of the ordinary for the services rendered.
(d) "Building" means a combination
				of materials forming a structure affording facility, establishment, or shelter
				for use or occupancy by individuals or property. Building includes a part or
				parts of the building and all equipment in the building. A building does not
				include a building incidental to the use for agricultural purposes of the land
				on which the building is located.
(e) "Bureau of fire services" or "BFS" means
				the bureau of fire services in the department of licensing and regulatory
				affairs.
(f) "Common ownership"
				means 2 or more state licenses or 2 or more equivalent licenses held by one
				person under the Michigan Regulation and Taxation of Marihuana Act.
(g) "Complete application" means an
				application that includes all of the information required in R 420.2 to R 420.5
				and R 420.7 to R 420.10.
(h)
				"Department" means the department of licensing and regulatory
				affairs.
(i) "Designated
				consumption establishment" means a commercial space that is licensed by the
				agency and authorized to permit adults 21 years of age and older to consume
				marihuana products at the location indicated on the state license issued under
				the Michigan Regulation and Taxation of Marihuana Act.
(j) "Director" means the director of the
				department of licensing and regulatory affairs or his or her
				designee.
(k) "Employee" means a
				person performing work or service for compensation. "Employee" does not include
				individuals providing trade or professional services who are not normally
				engaged in the operation of a marihuana business.
(l) "Equivalent licenses" means any of the
				following held by a person:
(i) A marihuana
				grower license of any class issued under the Michigan Regulation and Taxation
				of Marihuana Act and a grower license, of any class, issued under the medical
				marihuana facilities licensing act.
(ii) A marihuana processor license issued
				under the Michigan Regulation and Taxation of Marihuana Act and a processor
				license issued under the medical marihuana facilities licensing act.
(iii) A marihuana retailer license issued
				under the Michigan Regulation and Taxation of Marihuana Act and a provisioning
				center license issued under the medical marihuana facilities licensing
				act.
(iv) A marihuana secure
				transporter license issued under the Michigan Regulation and Taxation of
				Marihuana Act and a secure transporter license issued under the medical
				marihuana facilities licensing act.
(v) A marihuana safety compliance facility
				license issued under the Michigan Regulation and Taxation of Marihuana Act and
				a safety compliance facility license issued under the medical marihuana
				facilities licensing act.
(m) "Excess marihuana grower" means a license
				issued to a person holding 5 class C marihuana grower licenses and licensed to
				cultivate marihuana and sell or otherwise transfer marihuana to marihuana
				establishments.
(n) "Immature
				plant" means a nonflowering marihuana plant that is no taller than 8 inches
				from the growing or cultivating medium and no wider than 8 inches produced from
				a cutting, clipping, tissue culture, or seedling that is in a growing or
				cultivating medium or in a growing or cultivating container.
(o) "Limited access area" means a building,
				room, or other contiguous area of a marihuana business where marihuana is
				grown, cultivated, stored, weighed, packaged, sold, or processed for sale and
				that is under the control of the licensee.
(p) "Managerial employee" means those
				employees who have the ability to control and direct the affairs of the
				marihuana business or have the ability to make policy concerning the marihuana
				business, or both.
(q) "Marihuana
				business" means a marihuana facility under the medical marihuana facilities
				licensing act, or a marihuana establishment under the Michigan Regulation and
				Taxation of Marihuana Act, or both.
(r) "Marihuana business location plan" means
				a marihuana facility plan under the medical marihuana facilities licensing act,
				or a marihuana establishment plan under the Michigan Regulation and Taxation of
				Marihuana Act, or both.
(s)
				"Marihuana establishment" means a marihuana grower, marihuana safety compliance
				facility, marihuana processor, marihuana microbusiness, marihuana retailer,
				marihuana secure transporter, or any other type of marihuana-related business
				licensed by the agency under the Michigan Regulation and Taxation of Marihuana
				Act.
(t) "Marihuana event
				organizer" means a person licensed to apply for a temporary marihuana event
				license under these rules.
(u)
				"Marihuana facility" means a location at which a licensee is licensed to
				operate under the medical marihuana facilities licensing act.
(v) "Marihuana license" means a state
				operating license issued under the medical marihuana facilities licensing act,
				or a state license issued under the Michigan Regulation and Taxation of
				Marihuana Act, or both.
(w)
				"Marihuana product" means marihuana or a marihuana-infused product, or both, as
				those terms are defined in the acts unless otherwise provided for in these
				rules.
(x) "Marihuana tracking act"
				means the marihuana tracking act, 2016 PA 282, MCL 333.27901 to
				333.27904.
(y) "Marihuana
				transporter" means a secure transporter under the medical marihuana facilities
				licensing act or a marihuana secure transporter under the Michigan Regulation
				and Taxation of Marihuana Act, or both.
(z) "Medical marihuana facilities licensing
				act" or "MMFLA" means the medical marihuana facilities licensing act, 2016 PA
				281, MCL 333.27101 to 333.27801.
(aa) "Michigan Medical Marihuana Act" means
				the Michigan Medical Marihuana Act, 2008 IL 1, MCL 333.26421 to
				333.26430.
(bb) "Michigan
				Regulation and Taxation of Marihuana Act" or "MRTMA" means the Michigan
				Regulation and Taxation of Marihuana Act, 2018 IL 1, MCL 333.27951 to
				333.27967.
(cc) "Proposed marihuana
				business" means a proposed marihuana establishment under the Michigan
				Regulation and Taxation of Marihuana Act or a proposed marihuana facility under
				the medical marihuana facilities licensing act, or both.
(dd) "Restricted access area" means a
				designated and secure area at a marihuana business where marihuana products are
				sold, possessed for sale, or displayed for sale.
(ee) "These rules" means the administrative
				rules promulgated by the agency under the authority of the medical marihuana
				facilities licensing act, the marihuana tracking act, the Michigan Regulation
				and Taxation of Marihuana Act, and Executive Reorganization Order No. 2019-2,
				MCL 333.27001.
(ff) "Same location"
				means separate marihuana licenses that are issued to multiple marihuana
				businesses that are authorized to operate at a single property but with
				separate business suites, partitions, or addresses.
(gg) "Special license" means a state license
				as described under section 8 of the Michigan Regulation and Taxation of
				Marihuana Act, MCL 333.27958, and issued pursuant to section 9 of that act, MCL
				333.27959.
(hh) "Stacked license"
				means more than 1 marihuana license issued to a single licensee to operate as a
				class C grower as specified in each license at a marihuana business under the
				medical marihuana facilities licensing act, or under the Michigan Regulation
				and Taxation of Marihuana Act, or both.
(ii) "Tag" or "RFID tag" means the unique
				identification number or Radio Frequency Identification (RFID) issued to a
				licensee by the statewide monitoring system for tracking, identifying, and
				verifying marihuana plants, marihuana products, and packages of marihuana
				product in the statewide monitoring system.
(jj) "Temporary marihuana event license"
				means a state license held by a marihuana event organizer under the Michigan
				regulation and taxation of marihuana act, for an event where the onsite sale or
				consumption of marihuana products, or both, are authorized at the location
				indicated on the state license.