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Bill

SB 378

Online marketplaces: illicit cannabis: reporting and liability.

2025-2026 Regular Session Introduced by Scott Wiener

California law requires online marketplaces to report illicit cannabis sales and shields compliant platforms from liability, targeting illegal cannabis trafficking in e-commerce.

Chaptered by Secretary of State. Chapter 411, Statutes of 2025.
#onlinemarketplaces #illicitcannabis #reportingandliability
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Bill Summary · SB 378

Legislative bill overview

SB 378 requires online marketplaces to implement reporting mechanisms for illicit cannabis sales and establishes liability protections for platforms that comply with reporting requirements. The law aims to combat illegal cannabis trafficking on e-commerce platforms while shielding marketplace operators from certain legal liability when they take appropriate enforcement action.

Why is this important

California's legal cannabis market faces significant competition from unlicensed sellers operating on mainstream online platforms, undercutting legitimate businesses and tax revenue. This bill creates a middle ground—encouraging platforms to police illegal activity without exposing them to excessive litigation, which could otherwise incentivize platforms to ignore the problem entirely.

Potential points of contention

  • Platform compliance costs: Requiring marketplaces to develop cannabis-detection systems and maintain reporting infrastructure adds operational expenses that could be passed to consumers or smaller sellers
  • Enforcement gaps: Marketplace reporting is only effective if law enforcement agencies have adequate resources to investigate and prosecute reported cases of illegal sales
  • Definitional ambiguity: "Illicit cannabis" includes unlicensed sales, but distinguishing between legal home cultivation, gifting, and illegal commercial sales may create gray areas in platform moderation

Compiled from official sources — confirm details with the bill’s official record.

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