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Have a question? +1 815-826-6324 (815-8-BondAI) phil@AmericasSuretyBonds.com
Army Veteran Owned | Expert Surety Bonds Since 2004
The $5,000 figure applies to each licensed premises, not to the business as a whole. A company with three California cannabis licenses at three locations needs coverage for all three, either as separate bonds or one aggregated bond. You pay an annual premium instead of setting cash aside, and the executed DCC-8113 form goes straight into the Department of Cannabis Control application.
California requires every applicant for an annual commercial cannabis license to provide proof of a surety bond of at least $5,000 payable to the State of California for each licensed premises. The bond covers the cost of destroying cannabis or cannabis products if destruction is necessitated by a licensing violation. It is written on Department of Cannabis Control Form DCC-8113 by a corporate surety licensed to transact surety business in California.
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California Business and Professions Code 26051.5 requires a cannabis license applicant to provide proof of a bond to cover the costs of destruction of cannabis or cannabis products if necessitated by a violation of the Medicinal and Adult-Use Cannabis Regulation and Safety Act. The Department of Cannabis Control puts the amount in its regulations at Title 4, California Code of Regulations, section 15002(c)(22): proof of a surety bond of at least $5,000 payable to the State of California for each licensed premises.
That applies across license types. Cultivators, manufacturers, distributors, retailers, microbusinesses and testing laboratories all apply through the Department of Cannabis Control and all include this bond with the annual license application.
This is the detail most applicants miss. The $5,000 minimum attaches to each licensed premises. If one commercial cannabis business holds several licenses, the Department allows an aggregated bond to cover them, but the coverage still has to account for every premises.
The Department uses Form DCC-8113, Commercial Cannabis Licensee Bond (New 10/2023). The State of California is the obligee. The bond starts when the licensee receives the license and runs concurrently with that license period and every renewal period after it, so it does not need to be rewritten each year as long as it stays in force. The surety can cancel only by giving the Department and the licensee thirty days written notice, and it stays liable for anything that occurred before the cancellation date.
The bond guarantees that the licensee will follow MAUCRSA and the Department's rules and orders, including destroying cannabis or cannabis products when a violation requires it, and paying monies owed to the State. If the State has to cover destruction costs the licensee did not pay, it can recover them from the bond, and the licensee then repays the surety.
A licensee who replaces or changes a bond sends three items to licensechange@cannabis.ca.gov: Form 27, Notifications and Requests to Modify a License, a copy of the new or changed bond, and a completed Form DCC-8113.
The surety quotes an annual premium based on the bond amount, the number of premises covered and the owners' credit and business history.
Per location. Title 4 CCR 15002(c)(22) requires at least $5,000 for each licensed premises. A business holding several licenses can use one aggregated bond, but the coverage has to account for every premises.
Under Business and Professions Code 26051.5, it covers the cost of destroying cannabis or cannabis products if destruction is necessitated by a violation. Form DCC-8113 also conditions it on compliance with MAUCRSA and Department orders and payment of monies owed to the State.
Not necessarily. Form DCC-8113 runs concurrently with the license period and each succeeding renewal period, so the bond carries forward as long as the premium is paid and the surety has not cancelled it.
Yes, with thirty days written notice to the Department of Cannabis Control and to you. You would need replacement coverage filed before the cancellation takes effect to keep the license in good standing.
Email Form 27, a copy of the new bond, and a completed Form DCC-8113 to licensechange@cannabis.ca.gov.
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