National Post (National Edition) - - FINANCIAL POST - Bloomberg

That al­le­ga­tion isn’t true, Kee of TMX said.

“En­sur­ing com­pli­ance with TMX’s pub­lished rules and poli­cies across our broad is­suer base is an in­te­gral, on­go­ing func­tion we per­form and each is­suer is han­dled on a fact-spe­cific ba­sis,” she said.

In the mean­time, com­peti­tor Cana­dian Se­cu­ri­ties Ex­change has be­come a haven for tiny, un­li­censed Cana­dian com­pa­nies as well as U.S.-based cor­po­ra­tions barred from sell­ing shares in their do­mes­tic mar­kets.

TMX is sig­nalling it has “deep con­cerns” about list­ing com­pa­nies with U.S. ex­po­sure and is re­view­ing el­i­gi­bil­ity for list­ing, said Cana­dian Se­cu­ri­ties Ex­change CEO Richard Car­leton. Mar­i­juana com­pa­nies with U.S. investments al­ready make ex­ten­sive dis­clo­sures on their op­er­a­tions and any move to re­strict or pre­vent com­pa­nies from list­ing will be a dis­ap­point­ment to in­vestors, he said.

Of­fi­cials with Cana­dian Se­cu­ri­ties Ad­min­is­tra­tors, an um­brella or­ga­ni­za­tion for pro­vin­cial and ter­ri­to­rial reg­u­la­tors, are cur­rently dis­cussing these is­sues with the ex­changes, On­tario Se­cu­ri­ties Com­mis­sion spokes­woman Kris­ten Rose said in an email.

Some Cana­dian com­pa­nies would rather stay out of the U.S. than take the le­gal­ity risks as­so­ci­ated with the mar­ket.

In­sti­tu­tional in­vestors should be able to feel con­fi­dent that funds from Cana­dian mar­i­juana op­er­a­tions are not go­ing to­ward il­le­gal ac­tiv­i­ties, and dis­clos­ing U.S. op­er­a­tions in a prospec­tus is not a suf­fi­cient way “to ex­plain away break­ing a law,” said Bruce Lin­ton, the CEO of pot pro­ducer Canopy Growth Corp. The com­pany isn’t pur­su­ing any U.S. investments, he said.

“If there’s a doubt, err on the side of clar­ity,” Lin­ton said.

A new TMX pol­icy would give li­censed pro­duc­ers clar­ity on how to pro­ceed for the num­ber of com­pa­nies that are con­sid­er­ing ex­pan­sion in the U.S. or em­bark­ing on deals with brands that pro­duce in­fused prod­ucts in states such as Colorado and Wash­ing­ton, Aphria’s Neufeld said.

In TMX’s re­view, the com­pany is ex­am­in­ing both com­pa­nies that are di­rectly in­vest­ing in U.S. mar­i­juana pro­duc­tion and those that have more pas­sive investments, such as mar­ket­ing agree­ments, Neufeld said.

“I just hope when the new pol­icy comes down it’s not puni­tive to my share­hold­ers,” Neufeld said by phone. “We feel very, very con­fi­dent what we’ve done is all le­gal in the con­cept of Cana­dian law.”

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