On January 1, 2022 the California Department of Food and Agriculture implemented new regulations regarding the California Cannabis Appellations program. The Appellations Program  allows Licensed Cannabis Cultivators to establish an Appellation of Origin (“AOO”) which allows the cultivators to market their cannabis as produced from a geographically specific and unique region. 

Essentially, an AOO makes it so that only those cultivators who grew the cannabis within the geographical region of the AOO, and with the same practices, standards, and strains covered under the AOO, are the only cultivators who can market with the AOO. Anyone marketing their cannabis using the AOO without following the standards, will be breaking the law. 

This blog will discuss the in-depth application process and various requirements to establish an AOO. 

What is an AOO?

An AOO is a protected designation that identifies:

  • the geographical origin of a product, and 
  • production requirements to ensure a certain level of quality

It essentially is a marketing tool that informs consumers that the product is of a certain quality and/or comes from a certain region that produces unique cannabis. 

 

Other industry examples:
  • Champagne
  • Extra Virgin Olive Oil

For Champagne to be marketed as Champagne, the grapes must originate from the Champagne region in France, only certain types of grapes can be used, and the winemakers must follow a specific production method. All other “Champagne” not meeting these standards can only be marketed as “sparkling wine.” The label on the bottle that says “Champagne” lets consumers know that the product is of a certain standard of quality and came from the Champagne region of France. 

Similarly, Extra Virgin Olive Oil can only be marketed as “Extra-Virgin” if a very specific production process was used to extract the oil from the olives. There are also quantifiable benchmarks that must be met for the olive oil to qualify as “Extra Virgin.” If the process is followed then the benchmarks will be met, and then the oil can then be certified and marketed as “Extra Virgin Olive Oil.”

California’s AOO program would allow a geographical region to be designated so that the cannabis produced from that region can be marketed as unique and specific to that region, just like with Champagne. The AOO program also requires verifiable production requirements before the cannabis can be marketed as unique, just like with Extra Virgin Olive Oil.

Who can establish an AOO?

AOO designation is specific to outdoor cultivations with cannabis planted in the ground.

If the cannabis was grown using any type of structures (such as greenhouses, hoop houses, glass houses, hothouses, or any similar structure) or uses any artificial light, it would be ineligible for use of the AOO designation. 

How do you establish an AOO?

There is an in-depth application process with multiple sections. After the Application has been submitted and the fees have been paid, there is a 90-day public comment period before the application is established or denied. 

The most in-depth sections of the application are:

  • Geographical Description: 
    • The application needs to identify the geographical region that the AOO will apply to, including:
      • total acreage,
      • total canopy occupied under current licenses, and 
      • estimated canopy acreage eligible within the area.
    • The application must contain a legal description of the boundaries of the AOO.
    • Most importantly when describing the geographical region, the applicant needs to describe:
      • how the region is unique when compared to other regions
      • how those unique geographical features directly cause a physical difference in the cannabis produced in that area.
    • The unique features could be:
      • unique climate
      • soil
      • geological formation
      • watershed
      • elevation
      • orientation of the sun
      • others
    • As long as the geographical features cause a direct effect on the cannabis produced in that area, then the geographical features will satisfy this portion of the application.

 

  • Evidence of historical name use:
    • The applicant must show that the proposed AOO has a history of being used within the geographical area. This must be done by submitting a narrative, and evidence that the name of the proposed AOO has a history of being associated with the area.
    • Additionally, the application must demonstrate the legacy, history, reputation, and economic importance of cannabis production within the area.

 

  • Standards, Practices, and Cultivars:
    • The application needs to set out some sort of method for ensuring that cannabis produced within and marketed with the AOO is in fact unique. This “uniqueness” can be established by listing the Standards, practices, or cultivars that help identify what makes cannabis unique.
    • Whatever method is used to establish the uniqueness of the cannabis, there needs to be methods to verify and maintain records that certify the cannabis is unique to the AOO area.

 

  • Standards:
    • Consist of upper and lower limits of measurable characteristics, or certifications for inspectors who then certify that the cannabis meets a certain level of quality.

 

  • Practices:
    • Consist of procedures and methods for cultivating that, when followed, produce unique cannabis.

 

  • Cultivars:
    • Consists of strains that are unique to the AOO area. These specific and unique strains are listed on the application, and there must also be a method to.

Why would you want to establish an AOO?

An AOO is a marketing tool that informs the consumer that the cannabis they are purchasing, is of a certain unique quality. It is a way to communicate to the consumer without relying on the testing panel on the packaging.

Further, once an AOO has been established, no other cannabis business can market their cannabis using the AOO without having the cannabis originate within the AOO. It protects the AOO cannabis from imitators and allows the customer to be sure of the quality they are purchasing. 

Contact KVK if you would like help establishing an AOO.

Blog by James Dewey – January 27, 2022

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