The parent company of Canada’s largest stock exchange said that marijuana companies that do business in the U.S. cannabis market could possibly be delisted.
The TMX Group, parent of the Toronto Stock Exchange and the TSX Venture Exchange, issued a notice to listed companies that provided clarity regarding the application of its rules for companies in the marijuana sector.
It noted that marijuana remains illegal under federal law in the United States, and that cannabis companies doing business there could have their TSE and Venture listings reviewed.
“There may be issuers on our market that are not in compliance with the requirements. We will only come to find that out through the process of our review,” Ungad Chadda with TMX Group Ltd. said in a briefing with reporters, Bloomberg reported. “If you’re violating federal law, you’re out.”
It’s the first sign since August that the TMX plans to take action, which could come in the form of delisting companies that violate federal law or force them to divest those assets.
A cloud had been hanging over the industry since TMX Group failed to develop a clear policy for publicly listed companies that have ties to the U.S. cannabis industry.