Cannabis in the news October 24, 2018

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A week after legalization, news on cannabis and cannabis stocks continues to mount up. We carefully filter all of the stories and select the ones that should mean the most to you as a Canadian investor.

1. Desjardins Group—Canada’s largest federation of credit unions—says it will now “support” clients who are looking to invest in the legal marijuana market.

Still, the financial services giant, with 293 individual credit unions in its group, is taking a selective approach.

CEO Guy Cormier says Desjardins has already helped some clients with their cannabis investments through lines of credit, mortgages and long-term loans.

“We have decided that we will support their needs if they want to go in this market right now,” he told the Financial Post.

Several of Canada’s big banks have also softened their opposition to lending to cannabis-related ventures.

2. Facebook will now include cannabis-related pages in the search results of its users, although they’ll only be the pages of businesses and organizations the company has verified.

Until this policy change, the social media giant prevented cannabis-related pages from showing up in search results in an effort to prevent black-market sales.

Those screening efforts have limited the marketing power of cannabis producers and other industry businesses.

Facebook’s move reflects the legalization of adult and medicinal use here in Canada, but also the growing number of U.S. states that permit some form of the drug’s use.

3. A growing number of cannabis users are questioning what they call excessive packaging mandated by government and meant to keep children safe.

Health Canada requires cannabis to be packaged in an immediate container that is tamper-evident and child-resistant; it must also prevent contamination and keep cannabis dry.

That wrapping is in most cases a plastic bottle then wrapped in a cardboard box, or sleeve.

One New Brunswick cannabis user points to as much as 70 grams of packaging for 1 gram of marijuana.

Still, a key part of that wrapping is an informational document developed by Health Canada to arm users with health and safety information. Packaging must also meet labelling standards.

4. Aurora Cannabis had its first day of trading on the New York Stock Exchange Tuesday, with a near-12% drop in value.

The setback reflects similarly steep declines for most cannabis stocks since Canadian legalization on Oct. 17. While marijuana sales across the country have been brisk, investors have pulled back.

In listing on a major U.S. exchange, Aurora joined a small group of Canadian cannabis producers. They include Tilray (Nasdaq) and Canopy Growth (New York). All have also maintained their Toronto listings.

To get listed on NYSE or Nasdaq, cannabis producers must prove they have not shipped cannabis into the U.S., except for federally sanctioned purposes.

5. South Korean citizens visiting Canada are being warned to steer clear of cannabis use while here.

“Even if South Koreans are in a region where marijuana is legal,” reads a Twitter post by the South Korean Embassy in Canada, “it will be illegal for them to consume it.

“Please take care not to commit an illegal act and be punished.”

Under South Korean drug laws, growing, possessing, transporting or consuming marijuana remains a criminal offense. Indeed, citizens can face up to five years in prison or a fine of up to 50 million won (about U.S.$44,000).

It’s not a hollow threat: Prosecutors have been known to screen the social media accounts of Koreans suspected of past cannabis use in an effort to collect evidence of their wrongdoing on vacation.


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