Is A Looming U.S. Crackdown Opening The Way For Canadian Cannabis Companies?

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Is a looming U.S. crackdown opening the way for Canadian cannabis companies?

A return to harsh enforcement of U.S. federal marijuana laws creates a market opportunity for Canada’s cannabis companies, a Canadian pot entrepreneur argues.

Recreational marijuana has become legal in more and more U.S. states – four states currently have legal pot, and four more voted to follow them last fall. And in the wake of more permissive laws, a thriving pot-related culture developed.

So it was easy (for a while) to ignore an awkward fact – from the U.S. federal government’s point of view, absolutely all of it is still illegal.

The Obama administration took a tolerant view of states that chose to legalize pot, but a letter sent to U.S. governors by the Trump administration seems to signal that that party may be over.

All of this uncertainty opens the field for Canadian marijuana companies to compete internationally, says Bruce Linton, CEO of Smith’s Falls, Ont., cannabis producer Canopy Growth. U.S. cannabis producers are finding it hard to raise capital and function as conventional companies.

“We’re seeing few, or no American participants in the international markets, which is kind of helpful because they tend to be pretty good competitors.”

Since there’s not much that U.S. cannabis companies can do that isn’t federally illegal — even if the laws aren’t being enforced at the moment — it makes investors and business partners nervous.

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