1. (a) Notwithstanding any other section of this division, a licensee authorized to engage in retail activities with a combined A- and M-designated license may modify their jointly designated license to an A-license and receive a new M-license.

2. (b) To request a modification pursuant to this section, licensees authorized to engage in retail must submit the following information to the Department at [email protected]:

   1. (1) The existing A- and M-designated license they intend to separate.
   2. (2) The name under which the M-license will be listed and the name of the existing Designated Responsible Party submitting the request.
   3. (3) Business formation documents that demonstrate the requirements of subsection (b) of section 15000.2.
   4. (4) The licensee's federal employer identification number.
   5. (5) The licensee's valid seller's permit number issued by the California Department of Tax and Fee Administration.
3. (c) The Department shall review requests submitted pursuant to subsection (b) for compliance with those provisions as soon as possible, but no later than five (5) business days after receipt of the request. If the licensee satisfies the requirements of subsection (b), the Department will change the existing A- and M-designated license to a single A-license and issue a new M-license to the licensee. If the licensee does not satisfy the requirements of subsection (b), the Department shall send written notification to the licensee of all deficiencies.

4. (d) Licensees that are approved for the modification shall comply with the following conditions:

   1. (1) The licensee shall maintain all inventory held at the time of the designation change, and conduct all sales of such inventory, under the existing track and trace account for the A-License.
   2. (2) The licensee shall pay the applicable annual license fee for the M-license prior to transferring inventory to the M-license.
   3. (3) The licensee shall comply with the requirements of section 15000.2.
   4. (4) The licensee shall operate under the new M-license in compliance with local regulations and ordinances.
5. (e) Failure to comply with this section is grounds for suspension or revocation of both licenses in accordance with title 4, California Code of Regulations, division 19, chapter 12.
6. (f) Licensees that have been issued a new M-license shall have no license fee due for the license until the renewal period. At each subsequent renewal, the licensee must pay the Department the applicable license fee as required by section 15014 or 15014.1.

Note: Authority cited: Sections 26012 and 26013, Business and Professions Code. Reference: Sections 26001, 26013, 26050 and 26053, Business and Professions Code.

History

1. New section filed 6-4-2026 as an emergency; operative 6-4-2026 (Register 2026, No. 23). A Certificate of Compliance must be transmitted to OAL by 12-1-2026 or emergency language will be repealed by operation of law on the following day.