Current Status Of Online Orders In Colorado

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On June 4th, 2021 we provided a brief overview of coming changes in online ordering which was updated on June 14, 2021, “Business as Usual: The June 11, 2021 Expiration of COVID-19 Emergency Rules and the Impact on Colorado Marijuana Businesses”. Since our last update Governor Polis signed an extension of Executive Order 2020-011 which now allows for transactions completed outside of the licensed premises by licensed retail marijuana stores through electronic means to resume until July 10, 2021. What is the current status of online ordering and online transactions?

Rule 3-345 Explained

On March 11, 2020 Governor Polis signed Executive Order 2020 003 declaring a state of emergency in Colorado due to COVID-19. As a result of the state of emergency the Colorado Marijuana Enforcement Division promulgated Emergency Rule 3-345. Subsection (B) of this rule authorized online sales by retail and medical marijuana stores. The caveat is that the acceptance of the order itself and the completion of the order are authorized in different subsections of this rule. The acceptance of orders online or by phone is authorized in subsections (B)(2)(a) and (B)(3)(a) of the rule. However, accepting of payments by retail marijuana stores—where the entire transaction occurs outside of the restricted access area of the licensed premises as with an online transaction or through a curbside mobile device- is specifically authorized by subsection (3)(b) and would violate statute absent an Executive Order suspending the prohibition of online orders by retail marijuana stores. This is where Executive Order 2020-011 comes in. This order suspended the laws prohibiting online transactions for retail marijuana stores. With the expiration of that order the acceptance of payment for online transactions by retail marijuana stores is prohibited.

What is the Current Status?

Per the extension of Executive Order 2020 011 the acceptance of online or mobile POS payments may resume through July 10, 2021. The remainder of the rule, which includes the acceptance of the orders, will automatically sunset with Executive Order 2020 003, when the state of emergency is lifted, OR on September 1, 2021, whichever occurs first. As of now, there has not been any guidance as to the acceptance of orders online or via phone upon expiration of the remainder of rule 3-345. We are continuing to monitor this situation. 

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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