HB 5350 Opens Door to Sale of Social Equity Cannabis Businesses After Six Years

Adds $8,000 State Transfer Fee

CT CannaTimes Editor - 4.22.2026

Hartford, CT — A provision in the amended version of House Bill 5350 creates a clear pathway for Social Equity cannabis businesses in Connecticut to be sold or transferred after a set period; while requiring a fixed state fee each time ownership changes.

The change is contained in Section 54 of the bill and applies specifically to cannabis licenses issued under Connecticut’s Social Equity program.

Ownership transfers allowed after six years

Under HB 5350, cannabis businesses structured as “equity joint ventures” partnerships between a Social Equity applicant and a financial backer are no longer locked into their original ownership indefinitely.

The official bill analysis for the amended bill states:

“Allows a change in ownership or control in an equity joint venture after six years of final licensure…”

In practical terms, this means:

• A Social Equity license holder can sell or transfer ownership of the business

• The transfer can be made to another individual or company, including non–Social Equity buyers

• The change applies to control, ownership percentage, or full buyouts

$8,000 fee required for every ownership change: Any transfer of ownership or control triggers a mandatory payment to the state.

The bill states:

“the person acquiring the ownership or control, must pay… an $8,000 nonrefundable transaction fee”

The fiscal note for the amended bill HB 5350 confirms:

“Section 54 imposes a fee of $8,000 for a person acquiring ownership or control of an equity joint venture…”

Key details:

* The fee is paid by the buyer or acquiring party

* It is required to finalize the ownership transfer

* It is deposited into the Social Equity Innovation Account

* It is separate from the actual purchase price of the business

Buyers must also pay off state-backed loans

The bill requires that any outstanding public financing tied to the business be resolved before ownership changes hands: the acquiring party must pay “the outstanding balance on all loans issued to the equity joint venture or the social equity applicant…”

Transactions subject to state oversight

Ownership changes are not automatic and must follow a defined process:

* Advance notice must be provided to the Social Equity Council

• The Social Equity partner can request a formal review of the transaction

• The review examines whether the partner understands the deal and is not being pressured

Enforcement tied specifically to violations of transfer rules

HB 5350 also establishes enforcement authority tied to these ownership transactions.

According to the bill analysis: violations “may result in a fine of up to $10 million or action against the cannabis establishment’s license”

The fiscal note for the amended bill HB 5350 adds: such fines represent “a potential revenue gain to the General Fund to the extent violations occur”

The $10 million figure is a maximum penalty, not a standard fine, and applies only if the rules governing ownership changes are violated.

Bottom line

HB 5350 establishes a structured system for transferring Social Equity cannabis businesses in Connecticut:

* Ownership changes are allowed after six years

* Buyers can include non–Social Equity

individuals or companies

* Each transaction requires an $8,000 state fee

* Outstanding public loans must be paid before transfer

• Violations of the process can trigger significant enforcement penalties

The provision effectively creates a long-term pathway for Social Equity cannabis licenses to transition into new ownership, while keeping those transactions regulated and subject to state oversight.