54 LEXPERT MAGAZINE
|
JUNE 2018
FEATURE
IT'S NOT OFTEN THAT A HANDFUL
of Canadian stocks get the attention
of Barron's, the venerable newspaper that, for the most part, covers US financial
information and market developments.
But not only did Canada's cannabis stocks get attention, they got the close scru-
tiny of a major feature. As the newspaper pointed out, the US$30 billion capital-
ization the industry currently enjoys already approximates half the market capi-
talization of the country's gold stocks. Leading the pack are Canopy Growth, the
largest cannabis company in the world; Aurora Cannabis Inc., Aphria Inc. and
MedReleaf Corp.
To be sure, the article's focus suggested that the stocks were overvalued. But a
thorough read also reveals the industry's remarkable potential in the first industri-
alized country to legalize cannabis at the federal level. "e legalization of cannabis
is bigger than the end of Prohibition," says Vancouver-based James Munro of Mc-
Millan LLP. "It's more akin to grain becoming legalized and regulated."
e potential for legal work also looms large. And Canada's lawyers have not
been asleep at the wheel. "Our job is to help clients turn the challenges into op-
portunities, to break new ground and to grow a brand new industry," Munro says.
e cannabis industry, it turns out, is a complicated business, with political and
moral overtones, perfectly suited for the skills of the profession. To understand
what's involved from both a legal and business perspective, consider that key ques-
tions, even ones as simple as whether producers can assign their licenses, remain
unanswered. From a regulatory perspective, consider that over the years Health
Canada has approved but 94 of the 1665 applications for cannabis-related licenses.
Ontario has garnered more than 51 of these licenses, followed by B.C. with 20,
Quebec (6), Alberta (5), Saskatchewan (4), Nova Scotia (3), Manitoba and New
Brunswick (2 each) and Prince Edward Island (1).
"It's a high risk, high reward practice," says Ranjeev Dhillon, the Toronto-based
POLITICS AND SOCIETAL
MORAL CONCERNS
ADD LAYERS OF COMPLEXITY
TO LEGITIMIZING
THE SALE OF CANNABIS
BY JULIUS MELNITZER
CANNABIS IS
A COMPLICATED
BUSINESS
PHOTO:
SHUTTERSTOCK
