Weedmaps to Remove Unlicensed Cannabis Dispensaries from Directory

In August 2019, Weedmaps dealt black market marijuana retailers a devastating blow. The company announced it would no longer list unlicensed cannabis dispensaries in its directory. As a result, legal marijuana shops, regulators, and legislators applauded the decision, since the platform had allowed these black market businesses to undercut the legal market for too long.

Weedmaps Slow to Make Change

Weedmaps was initially resistant to the idea of removing unlicensed cannabis dispensaries from its website. In fact, it spent tens of thousands of dollars lobbying to fight legislation that would penalize it for failing to do so. Moreover, the company pushed back against the California Bureau of Cannabis Control after receiving a cease and desist order in early February. That order directed Weedmaps to remove all marijuana retailers operating outside of the regulated market.

The company’s dispensary directory had been the go-to resource for cannabis consumers for almost two decades. Therefore, the expansion of legalization had secured its market position indefinitely. The Irvine-based software giant then released a press release that clarified its new policy.

According to that release, Weedmaps would be “restricting the use of its point of sale, online orders, delivery logistics and wholesale exchange software-as-a-service (SaaS) platforms to licensed operators exclusively. In addition, Weedmaps will explore ways to make it easier for patients and adult-use consumers to identify the license number on advertised listings.”

Working with Legislators

Assemblywoman Blanca Rubio was especially pleased by this policy change, since she had sponsored CA AB 1417, which aimed at fining Weedmaps up to $2,500 per day for each violation. While the bill was never passed, she was relieved to hear the news. She pointed out that, “As the illicit market continues to thrive in California, the legislation is necessary to crack down on illegal dispensaries, protect consumers from untested products and promote the legal market.”

Weedmaps CEO Chris Beals also commented on the move away from unlicensed cannabis dispensaries, saying, “These enhancements to existing safeguards on our platform will help patients and adult-use consumers find cannabis retailers that have provided evidence of state licensure.” He went on to add that, “It also underscores our commitment to working with lawmakers and regulators to foster a flourishing legal market.”

The real winners of this decision were the hundreds of dispensaries who spent time and money jumping through legal hoops to receive a license. After all, state, local, and excise taxes had made it virtually impossible to compete with unlicensed cannabis dispensaries that evaded these surcharges. As a result, many retailers felt that this change would finally give them the leg up on the competition they needed to outlast the black market.