Canada’s Delisting Scare do give into it…
BULLETIN TYPE: Notice to Issuers
BULLETIN DATE: October 16, 2017
Re: Business Activities Related to Marijuana in the United States
TSX Venture Exchange (the “Exchange”) is providing guidance in respect of Policy 2.1 – Initial
Listing Requirements, Form 2D Listing Agreement (the “Listing Agreement”) and Policy 2.9 –
Trading Halts, Suspensions and Delisting (collectively, the “Requirements”) of the Exchange’s
Corporate Finance Manual (the “Manual”). The Exchange uses Bulletins to provide applicants
and listed issuers with a better understanding of existing Exchange requirements and the rationale
underlying such requirements, with a view to facilitating the listing process and supporting
successful listings on the Exchange.
Regardless of the industries in which they operate, the Exchange satisfies itself that (i) the
business of applicants or listed issuers will be conducted with integrity and in the best interests of
the issuer’s security holders, and (ii) applicants or listed issuers will comply with all laws, rules
and regulations applicable to their business or undertaking.
The Exchange notes that the Requirements apply to all applicants and listed issuers. However,
due to the significant number of inquiries received regarding entities engaging in activities related
to the cultivation, distribution or possession of marijuana in the United States (“Subject Entities”),
the Exchange is providing clarity regarding the application of the Requirements to applicants and
listed issuers in the marijuana sector.
The Exchange is aware that a number of U.S. states have legalized the cultivation, distribution or
possession of marijuana to various degrees and subject to various conditions. Nevertheless,
marijuana remains a Schedule I drug under the U.S. federal Controlled Substances Act. This
means it is illegal under U.S. federal law to cultivate, distribute or possess marijuana in the United
States. 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. While the Exchange is aware of the
federal guidance1 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.
Issuers with ongoing business activities that violate U.S. federal law regarding marijuana are not
complying with the Requirements. Such business activities may include, in order of concern to
the Exchange: (i) direct or indirect ownership of, or investment in, Subject Entities; (ii) commercial
interests or arrangements with Subject Entities that are similar in substance to ownership of, or
investment in, Subject Entities; (iii) providing services or products that are specifically designed
for, or targeted at, Subject Entities; or (iv) commercial interests or arrangements with entities
engaging in the business activities described in (iii). The business activities in (iii) and (iv) are
referred to as “Ancillary Services Activities”.
1 See the memoranda issued by James M. Cole, Deputy Attorney General, U.S. Department of Justice
entitled Memorandum for All United States Attorneys: Guidance Regarding Marijuana Enforcement (August
29, 2013) and Memorandum for All United States Attorneys: Guidance Regarding Marijuana Related
Financial Crimes (February 14, 2014).
Continued Listing Review
As part of the Exchange’s standard continued listing review of listed issuers, the Exchange selects
issuers for in depth reviews based on their continuous disclosure records. The Exchange notes
that the Manual requires that each listed issuer disclose material information regarding its
business and affairs.
In the context of its continued listing review of listed issuers in the marijuana sector, the Exchange
expects to group issuers into two categories. The first category is composed of issuers with
business activities that involve the cultivation, distribution or possession of marijuana in any
jurisdiction. The second category is composed of issuers that do not cultivate, distribute or
possess marijuana, but that appear to be engaging in Ancillary Services Activities. The Exchange
expects to contact listed issuers identified in its continued listing review by the end of the year for
a more comprehensive review.
Listed issuers should proactively work to address any gaps in their compliance with the
Requirements. The Exchange notes that if a listed issuer is engaging in activities that are contrary
to the Requirements, the Exchange has the discretion to initiate a delisting review under Policy
2.9 of the Manual.
The Exchange is aware that legislation applicable to the marijuana sector is evolving rapidly. The
Exchange has prepared this Bulletin based on its experience to date and continues to monitor
legal developments affecting this sector. The Exchange strongly recommends that applicants and
listed issuers considering engaging in marijuana-related activities in the United States consult
with the Exchange and consider the guidance in this Bulletin accordingly. The Exchange
continues to welcome all qualified applicants that are conducting business activities in any sector
provided that the applicant is complying with the Requirements. In particular, the Exchange
continues to welcome qualified applicants in the marijuana sector that operate within Canada and
comply with applicable Canadian law.
Don’t let this change anything treat this the same as a terror attack and go about you business as you normally do….
A few week back we hit all time low in the pot sector and this news in day put us even lower then that….!!!!
We to stand up and take the BULL BY THE HORNS tomorrow and rally the pot sector like never before so that we cannot be bullied ALSO the best time to buy everything on the market is at the bottom on hype up news that does nothing but send the price lower for a very short period of time….
We Know it all about money think about that how much will it cost TSX to delist a stock Ya not much but how much will it lose taking a hot stock off the market they ten of thousands a day in trading fees on just one stock every opportunity in the world is going to be given to them to fix this or time to change the laws