The Toronto Stock Exchange could delist, suspend, or halt trading for medical cannabis companies with investments in the U.S. because the operations are prohibited under federal law. In the Oct. 16 Notice to Issuers, regulators say while they are “aware” that some states have legalized cannabis for medical and adult use, “it is illegal under U.S. federal law to cultivate, distribute, or possess marijuana.”
“Furthermore, financial transactions involving proceeds generated by, or intended to promote, marijuana-related business activities in the U.S. may form the basis for prosecution under applicable U.S. federal money laundering legislation,” the memo states. “While the Exchange is aware of the federal guidance concerning the enforcement of these legislative provisions, the Exchange notes that such guidance does not have the force of law and can be revoked or amended at any time.”
The memo indicates that regulators will review cannabis-related stocks currently trading and break them down into two categories – those that touch the plant and ancillary businesses – before determining whether to take any action against the firm.
According to a Reuters report, about 25 companies listed on TMX Group exchanges, which includes the Toronto Stock Exchange and the Toronto Venture Exchange, cultivate, distribute and possess cannabis but Ungad Chadda, TMX head of capital formation for equity markets, declined to indicate how many of those companies have U.S. exposure.
Richard Carleton, chief executive of the Canadian Securities Exchange, a smaller exchange which competes with TMX, said the firm would welcome cannabis companies with U.S. exposure, noting that 12 of the 50 cannabis firms currently trading on the CSE have U.S. interests.
The TSE memo says it would continue to allow Canadian canna-businesses that operate within Canada and comply with Canadian laws.
Brand names for sale:
AlaskanThunder.com
InnerSpark.com
CannabisPlant.com
ORMedicalUse.com
HeavenlyHash.com
ClinicalCannabisCenter.com
Opinions expressed the above syndicated article by TG Branfalt are for informational purposes only and not necessarily the opinion of Herban Medical Options.
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