diff --git a/README.md b/README.md
new file mode 100644
index 0000000..28aca6b
--- /dev/null
+++ b/README.md
@@ -0,0 +1,111 @@
+# CannaManage
+
+Multi-tenant cannabis club management platform for German **Anbauvereinigungen** (cultivation associations) under CanG §19.
+
+## Overview
+
+CannaManage handles member management, distribution tracking, and legal compliance for cannabis cultivation clubs in Germany. It enforces the strict quotas mandated by the Cannabis Act (CanG) — including monthly limits (50g adult / 30g under-21), daily limits (25g), and THC restrictions for minors.
+
+## Tech Stack
+
+| Component | Technology |
+|-----------|-----------|
+| Runtime | Java 21 (Temurin) |
+| Framework | Spring Boot 4.0.6 |
+| Security | Spring Security 7.0 + JWT (JJWT 0.12.6) |
+| ORM | Hibernate 7 / JPA |
+| Database | PostgreSQL (prod), H2 (test) |
+| Migrations | Flyway 10 |
+| API Docs | SpringDoc OpenAPI 2.8.6 |
+| Build | Maven (multi-module) |
+| Container | Docker Compose (Postgres + app) |
+
+## Project Structure
+
+```
+cannamanage/
+├── cannamanage-domain/      # JPA entities, enums, TenantContext
+├── cannamanage-service/     # Business logic, repositories, ComplianceService
+├── cannamanage-api/         # Spring Boot app, controllers, security, DTOs
+├── docs/
+│   └── sprint-2/           # Sprint planning docs
+└── docker-compose.yml       # Local dev environment
+```
+
+## Modules
+
+### cannamanage-domain
+JPA entities with multi-tenant isolation via `@Filter("tenantFilter")`:
+- `Member` — club members with age tracking
+- `Distribution` — cannabis distribution records
+- `MonthlyQuota` — per-member monthly usage tracking
+- `Batch` / `Strain` / `StockMovement` — inventory management
+- `Club` — association registration
+- `User` — authentication accounts
+
+### cannamanage-service
+- `ComplianceService` — CanG §19 quota enforcement (25 unit tests)
+- Repositories for all entities
+
+### cannamanage-api
+- **Auth** — JWT login + refresh token rotation (SHA-256 hashed)
+- **Members** — CRUD for association members
+- **Distributions** — compliance-gated distribution recording
+- **Stock** — batch and inventory management
+- **Compliance** — quota status API
+- Multi-tenant isolation via `TenantFilterAspect` (Hibernate @Filter activation)
+
+## API Endpoints
+
+| Method | Path | Auth | Description |
+|--------|------|------|-------------|
+| POST | `/api/v1/auth/login` | Public | Login with email + password |
+| POST | `/api/v1/auth/refresh` | Public | Refresh token rotation |
+| GET | `/api/v1/compliance/quota/{memberId}` | ADMIN, MEMBER | Monthly quota status |
+| GET/POST/PUT | `/api/v1/members/**` | ADMIN, MEMBER | Member CRUD |
+| POST | `/api/v1/distributions/**` | ADMIN, MEMBER | Record distributions |
+| GET/POST | `/api/v1/stock/**` | ADMIN | Stock management |
+
+Swagger UI: `http://localhost:8080/swagger-ui.html`
+
+## Running Locally
+
+```bash
+# Start PostgreSQL
+docker compose up -d
+
+# Run the app
+JAVA_HOME=/path/to/jdk-21 ./mvnw spring-boot:run -pl cannamanage-api
+
+# Run all tests (H2 in-memory)
+JAVA_HOME=/path/to/jdk-21 ./mvnw clean verify
+```
+
+## Testing
+
+- **37 tests total** — all green
+- 25 unit tests (`ComplianceServiceTest`) — quota enforcement logic
+- 7 integration tests (`AuthControllerIntegrationTest`) — full HTTP auth flow
+- 5 integration tests (`ComplianceControllerIntegrationTest`) — quota API with JWT
+
+Integration tests use `@SpringBootTest(webEnvironment = RANDOM_PORT)` with H2 and Spring's `RestClient`.
+
+## Security Model
+
+- **Stateless JWT** — no session, no UserDetailsService
+- **Roles**: ADMIN (full access), MEMBER (self-service), STAFF (Sprint 3)
+- **Multi-tenancy**: Hibernate `@Filter` activated per-request via AOP aspect
+- **Refresh tokens**: SHA-256 hashed (Spring Security 7 enforces BCrypt 72-byte limit)
+- Token rotation on refresh — old tokens invalidated
+
+## Sprint History
+
+| Sprint | Focus | Status |
+|--------|-------|--------|
+| 1 | Domain entities, ComplianceService, 25 tests | ✅ Done |
+| 2 | REST API, Spring Security, JWT, OpenAPI, integration tests | ✅ Done |
+| 3 | Member portal, STAFF role, real-time notifications | 📋 Planned |
+
+## License
+
+Private — Patrick Plate