Canada exchange asks pot firms to disclose risks on U.S. operations
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Explained: Five ways the Fed's expected rate cut could affect consumersA small Canadian stock exchange said on Friday it has asked marijuana companies to provide details on risks they face from any U.S. operations in the wake of a Trump administration move to boost enforcement of anti-cannabis laws.
The U.S. Justice Department on Thursday rescinded an Obama-era policy that had eased enforcement of federal marijuana laws in states that have legalized the drug, instead giving federal prosecutors wide latitude on pursuing criminal charges.
"In light of yesterday`s announcement there are certainly some disclosure issues that companies should address," Canadian Securities Exchange Chief Executive Richard Carleton told Reuters via telephone.
The exchange has contacted 17 cannabis companies with U.S. exposure whose shares it lists, asking for public statements on how the policy announced by U.S. Attorney General Jeff Sessions could impact their businesses, Carleton said.
Those companies include CannaRoyalty Corp
The move follows an October notice from Canadian securities regulators that U.S.-linked marijuana companies must clearly warn investors about the risks, given the federal ban on marijuana production and sales.
Dozens of marijuana companies have gone public over the past few years in Canada, helping them finance expansion in the existing medical cannabis market and prepare to enter the nation`s recreational market, which is slated to open up in mid 2018.
Marijuana stocks have posted strong gains over the past year, making the group one of the hottest sectors in the Canadian stock market.
CannaRoyalty was one of the first CSE-listed firms to comment on the impact of the new U.S. policy.
"We do not foresee the memorandum meaningfully impacting the way that existing cannabis business is conducted within legal states," CannaRoyalty CEO Marc Lustig said in a statement.
Carleton said he expects all firms to respond within days.
The others are: Alternate Health Corp
Some 60 marijuana companies have listed on the CSE, choosing it over TMX Group Ltd`s
TMX told Reuters via email on Thursday that its guidance on the matter from October stands.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
