Pubdate: Tue, 17 Oct 2017
Source: National Post (Canada)
Copyright: 2017 Canwest Publishing Inc.
Author: Geoff Zochodne
Page: FP2


An alliance of Canadian securities regulators said Monday that it
expects domestic companies with marijuana dealings in the United
States to give their investors a good idea of the potential risks of
doing drug business south of the border, which could now include the
possibility of being delisted from the Toronto Stock Exchange.

"We expect issuers with marijuana-related activities in the U.S. to
address the current legal and regulatory environment in their
disclosures, including any risks that result from changes in the
approach to enforcement of U.S. federal law," Louis Morisset, chair of
the Canadian Securities Administrators, said in a press release.

Cannabis sales are legal in some states, but illegal at the federal
level in the U.S. Furthermore, the Toronto Stock Exchange, Canada's
biggest, warned Monday that issuers conducting business in violation
of U.S. federal laws around cannabis are not in compliance with the
exchange's own requirements.

Those not complying with the requirements could face a delisting
review, the TSX said.

The TMX Group Ltd., owner of the Toronto Stock Exchange and the
Canadian Depository for Securities, a clearing house that processes
trades, said in August it had been in talks with the CSA about the
thorny subject of Canadian issuers with marijuana-related operations
in the U.S., calling it "a complex matter which touches multiple
aspects across our capital market system."

The notice for Canadian issuers with marijuana interests in the U.S.
outlines the expectations for disclosure, including a description of
any U.S.-based operations.

"They'll also be required to provide disclosure in terms of what
happens if the legal framework changes," Richard Carleton, chief
executive of the smaller Canadian Securities Exchange, said Monday.

"So, if the U.S. federal government decides to make life difficult for
companies operating legally at the state level, what would the impact
on the company's business be."
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