How to Start a Cannabis Business in Puerto Rico?

Main steps in short:

Understand regulatory and legal requirements. Do market research.

Research the laws and regulations governing medical cannabis for more information about the regulatory requirements for licensure in the city or town you wish to operate.

Puerto Rico Cannabis Legalization

On July 9, 2017, Puerto Rico Gov. Ricardo Rosselló signed into law Act No. 42-2017 which replaced the original executive order (Executive Order 2015-10) and set up a legal framework for the Puerto Rico medical cannabis industry, including the creation of the Medicinal Cannabis Regulatory Board (the Board) and a control structure. In July 2018, Regulation 9038 was enacted to establish regulations governing the medical cannabis industry including the process of applying for a medical cannabis license.

Puerto Rico Cannabis Market

On December 13, 2024, the Regulatory Board adopted a moratorium which temporarily suspended the submission and receipt of new applications for all types of cannabis businesses. The moratorium on the submission and receipt of new applications for laboratory, manufacturing, transportation, and research licenses was lifted on June 1, 2025. Applications for cultivation and dispensary permits are still suspended until the Board evaluates and analyzes the results of a market study or until December 31, 2025, whichever is earlier.

Establishments must be registered in the Registry of Licenses for Medical Cannabis Establishments in order to be able to legally cultivate, manufacture, distribute, transport or carry out testing on cannabis or medicinal cannabis products. The Medical Cannabis Office (the Office), which is under the Department of Health, is responsible for evaluating license applications and approving them.

All licensed establishments must be located at least 100 meters away from a school.

Decide the type of cannabis business. Choose a location. Check local zoning regulations.

Cannabis Licenses Types Available in Puerto Rico

Cultivation

A Cultivation License allows to cultivate, dry, cut, cure and package medical cannabis for sale to a manufacturer or an authorized dispensary.

Additional requirements for obtaining a Cultivation License:

A certification of compliance with good agricultural practice (GAP) or a certification equivalent approved by the Department of Agriculture of Puerto Rico.
Evidence of having completed a GAP course.

Fees:

Up to 10,000 sq ft: $10,000
10,000 to 20,000 sq ft: $15,000
20,001 to 30,000 sq ft: $25,000

Dispensary

A Dispensary License allows to purchase cannabis from a cultivator or a manufacturer to then sell, supply or provide cannabis to patients. It also permits to deliver cannabis to authorized patients.

Additional requirements for obtaining a Dispensary License:

The Medical Cannabis dispensary must have at least 2 entrances.
There must be a security guard present during business hours.
The dispensary must have security arrangements and alarms in place as well as a surveillance system.

License fee: $20,000

Manufacturing

A Manufacturing License allows to purchase cannabis, manufacture and package cannabis products and sell them to dispensaries.

Additional requirements for obtaining a Manufacturing License:

Follow good manufacturing practice (GMP) guidelines.
A current food hygiene certificate issued by the Assistant Secretary of Environmental Health Department.
Evidence of having completed a food safety course.

Fees:

Up to 5,000 sq ft: $10,000
5,001 – 25,000 sq ft: $20,000
25,001+ sq ft: $30,000

Transportation

A Transport License allows to store and transport medical cannabis and medicinal cannabis products.

Additional requirements for obtaining a Transport License:

Provide the logistics and information on storage and transportation of medical cannabis.
A Tracking System must be used.
Every employee must have an occupational license issued by the Office.
Provide a list of people with whom the establishment will do business and who will be hired once the license is obtained.
Submit a product safety plan during transportation.

License fee: $50,000

Testing Facility

A Laboratory License permits to test cannabis for concentration and contaminants.

Additional requirements for obtaining a Laboratory License:

Hold a license to operate as a laboratory.
Have an approved standardized operating procedures manual.
Have validated analysis procedures and a quality control program.
Have a storage room with the necessary security measures.
Have a Tracking System and an identification tag program.
Comply with occupational safety standards in the establishment.

Applicants for a Laboratory License cannot apply for a license to cultivate, manufacture, transport or distribute cannabis.

License fee: $50,000

Cannabis Delivery in Puerto Rico

The law allows a licensed dispensary to deliver cannabis to authorized patients.

Cannabis Delivery Service by State

Develop a solid cannabis business plan . Secure financing.

Application requirements include demonstrating a likelihood of success. As determined in Regulation 9038, the applicant must submit:

Evidence that the applicant is financially able to maintain the establishment for a period no less than 12 months.
Financial projections including break-even analysis.

These requirements can be effectively conveyed through a well-structured business plan that clearly articulates the company’s initial funding plans, realistic financial projections, and path to sustainable profitability.

Find more

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Prepare the required documents. Submit applications. Pay fees.

All information and documents required when applying for a medical cannabis license are detailed in Regulation 9038.

Requirements to applicants:

The applicant must be at least 21 years old.
The applicant must be a resident of the Commonwealth of Puerto Rico. All applicants that are entities must have a resident of the Commonwealth of Puerto Rico.
At least 51% of ownership of the business for which the applicant seeks to obtain the license must belong to Puerto Rico residents.

Required documents are not limited to:

Proof that the applicant is over 21 years old.
A copy of identification with a current photo of each applicant holder whose participation in the business will be greater than 5%.
Evidence that 51% of the ownership of the business belongs to residents of Puerto Rico.
A Criminal Record certificate no more than 3 months old from the date of its issue for every applicant holder whose participation in the business will be greater than 5%.
A Certification of No Debt from the Department of the Treasury of Puerto Rico.
A Certification of No Debt from the Municipal Revenue Collection Center.
A partnership contract, if applicable.
A Sanitary License.
Evidence that the applicant has not served a sentence for felony conviction under federal or state law relating to the possession, distribution, manufacture, cultivation or use of a controlled substance.
A map of the proposed location for the establishment, certified by a surveyor, engineer or architect stating that the site is at least 100 meters away from a school.
Evidence of ownership of the proposed establishment. In case of a rental, a present lease agreement or a letter of consent from the owner communicating the intention to lease the premises for a Medical Cannabis establishment.
Detailed plan of the establishment.
Merchant Registration document.
A non-refundable payment for the application fee. The application will not be evaluated until payment is received.
If the applicant is an entity, it must certify that the owners, shareholders and members of the Board of Directors comply with all the necessary requirements and it must submit:
- Evidence of being organized or authorized under the laws of the Government of Puerto Rico.
- Corporate or Organization Statutes, as applicable.
- A Corporate Structure report.
- Its registered address.
- The business identification number.
- Employer social security number.
- Notice or Election of Classification of Partnership or Company Limited Liability, as applicable.
- Evidence of sufficient financial resources to establish each business requested.
- Evidence that the owners, shareholders, directors and members of the legal entity are over 21 years old.

Application review. Final inspection. Final fees.

Application review steps:

The application is received and reviewed for completeness. A check is performed to confirm that the information provided is correct and complies with the appropriate requirements.
If the application meets the requirements, it is evaluated. The Department of Health may register and pre-qualify applicants so they can begin design and construction, among other activities.
The Office will perform an inspection of the facilities. The inspection must be requested by the applicant within 6 months of receiving the pre-qualification letter.
If approved, the applicant will be notified by email or regular mail.

Commence operations. Post your license.

After the license is received:

The applicant must begin using the license within the period of 1 year.
The license must be displayed in a place visible to the public.
All books and records with commercial transactions carried out under the license relating to the current year and the 5 preceding years must be kept.
Licensed establishments can sell, deliver or transport cannabis or medicinal cannabis products only in the hours between 6:00 am and 10:00 pm.

License renewal.

A notice of license renewal will be sent 90 days before the license’s expiration date by email to the owner of the license. The request for renewal of the existing license must be sent earlier than 30 days before the license’s expiration. All documents that have expired since the initial application must be updated.

Keep track of your ongoing compliance requirements.

Physical security measures, good production practices, packaging, labelling, transport and reporting requirements, taxes and more.

Puerto Rico Cannabis Taxes

Puerto Rico’s sales and use tax (SUT) applies to medical cannabis. There are no specific taxes on medical cannabis.

Cannabis Advertising Regulations in Puerto Rico

Licensed medical cannabis establishments may promote their business and medical cannabis products through all available means except those that are prohibited by Regulation 9038. All medical cannabis establishments must adhere to the following rules:

Marketing of medical cannabis cannot be performed within 100 meters of a school.
The use of coupons is prohibited.
Naming or titling a medical cannabis product with a name that attracts the attention of children or minors or that could be perceived as a false or misleading representation is prohibited.
Tours of authorized establishments as a method of marketing are prohibited.
Pricing for medical cannabis and its products can be displayed only at dispensaries and on the commercial website of a cannabis business. It is not permitted on other media and/or social networks such as Facebook, Instagram, and X.
Licensed cannabis cultivation and manufacturing establishments may provide educational material about their products to the medical community to familiarize them with the products and their composition.
Free distribution of medical cannabis samples or products to the medical profession is prohibited.
Licensed medical cannabis establishments may display no more than 2 signs visible to the public, identifying their establishment. The size of these signs may not exceed 60 inches by 60 inches. These signs may contain only the name and logo of the establishment and must comply with all other applicable advertising regulations.