Retail Cannabis Licenses: Changes Coming to Management and Other Agreements
Retail Cannabis Licenses: Changes Coming to Management and Other Agreements
The state passed a law (ESSB 5403) that clarifies what is considered a “financial or other ownership interest” (RCW 69.50.325) that prevents any individual person or entity from ownership in more than five cannabis retail licenses. The law went into effect on Jan. 1, 2026.
A financial interest now includes, but is not limited to:
- Any sharing of profits or revenue;
- Any assistance, coordination, or recommendation for the purchase of cannabis products if pricing is coordinated or discounted;
- The common use of intellectual property such as branding, trade names, logos, social media accounts, or websites;
- Any operational control over the business or operational support for typical day-to-day business operations, including core business or executive functions (business decisions or oversight) of the retail cannabis license;
- Any sharing or coordination of marketing and/or advertising efforts or expenses; and
- Any coordinated sharing of employment or hiring decisions, including the shared employment of individuals.
The Liquor and Cannabis Board (LCB) must ensure all retail cannabis licensees are following the laws and rules preventing any person from having an interest in more than five retail licenses..
The law does not allow any existing agreements to continue past Jan. 1, 2026. This includes consulting services agreements, intellectual property agreements that include use of certain retail cannabis trade names, and/or other management services agreements which were previously reviewed by the LCB. Beginning Jan. 1, 2026, all agreements must meet the clarified legal requirements.
Complaints related to ownership or management agreement issues can be submitted here.
Complaint process:
The LCB is currently conducting rulemaking to align existing rules with the new statutory language and intent of ESSB 5403. To follow or provide feedback during the rulemaking process, you can find more information the LCB’s Current Rulemaking Activity webpage under Cannabis Rulemaking.