Opinion: Aurora Cannabis Is Blatantly Disregarding Shareholder Value With Its Acquisitions

Opinion: Aurora Cannabis Is Blatantly Disregarding Shareholder Value With Its Acquisitions
Weed stock Tilray down on news workers may face lifetime US travel ban
Marijuana stocks Tilray (TLRY), Cronos Group (CGC) and Cronos Group (CRON) slid after-hours on a report that a U.S. border official said that Canadian industry employees and marijuana investors broadly could be blocked from coming to the U.S.

“If you work for the industry, that is grounds for inadmissibility,” the official, Todd Owen, executive assistant commissioner for the Office of Field Operations, told Politico.

Cannabis-related stocks dropped in after-hours trading Thursday following a report that the U.S. may bar Canadians who invest in the companies from entering the U.S. Politico reported Thursday afternoon that an official with the U.S. Customs and Border Protection agency said that Canadians who smoke marijuana, work in the industry or invest in the companies could be permanently banned from the U.S. "Facilitating the proliferation of the legal marijuana industry in U.S. states where it is deemed legal or Canada may affect an individuals admissibility to the U.S.," Todd Owen, executive assistant commissioner for the Office of Field Operations at the CBP, told Politico. Marijuana use will officially become legal in Canada on Oct. 17. The CBP did not immediately respond to an email seeking to confirm the statements. Stocks that immediately declined in late trading included Tilray Inc. TLRY, +14.11% which declined more than 5%; Canopy Growth Corp. CGC, -13.67% which dropped about 4%; and Cronos Group Inc. CRON, -10.29% which also fell about 4%.

Marijuana Stocks Fall On Report That US Could Ban Canadian Workers

Same goes for if you invest in it. “We dont recognize that as a legal business,” he said, adding that investors from nations like Israel have been blocked from U.S. entry.

Canadians who invest in marijuana-related stocks, as well as those who use pot or work in the cannabis industry, could be banned from ever entering the U.S., according to a report Thursday.

Recreational legalization in Canada, which is only weeks away, could complicate cross-border travel between the two countries, Politico noted. The U.S. still federally forbids marijuana even as more states have legalized it over the past several years.

Owen told Politico the U.S. wouldnt be asking everyone crossing the border whether theyve used marijuana, but said authorities might inquire further “if other questions lead there.” Lying about past drug use, he told Politico, represents “fraud and misrepresentation, which carries a lifetime ban.”

Earlier Thursday, Tilray said it had received the OK to export buds into Germany for patients in that nation. The company made its cannabis extract products available in Germany last year. Germany legalized medical marijuana last year.

On Tuesday, Tilray said that its CBD oil “was successfully imported” into the U.K. for a patient. On Wednesday, short-seller Citron Research said surging valuations in marijuana stocks were “more ridiculous than Bitcoin” and had led to a “ridiculous valuation discrepancy” for Tilray. Earlier this month, Northland Capital downgraded Tilray, saying that its valuation was “complex” while still praising the companys strengths.

Canadians who invest in marijuana-related stocks, as well as those who use pot or work in the cannabis industry, could be banned from ever entering the U.S., according to a report Thursday.

While pot smokers and cannabis-industry workers have previously faced the prospect of lifetime travel bans, it may be news to investors that the risk extends to them as well.

Marijuana-related stocks fell in after-hours trading after Politico published the report, and extended those losses in premarket trade Friday. Tilray Inc. TLRY, +14.11%   was last down 71u, Canopy Growth Corp. CGC, -13.67%   was off 6% and Cronos Group Inc. CRON, -10.29%   was down 10%. Aurora Cannabis Inc. ACBFF, -9.07%   was down 4%. S&P 500 SPX, +0.53%  futures were up 0.2%. The news added to the high-flying sectors slump this week following reports that U.S. regulators may crack down on flavored e-cigarettes.

According to the report by Politico, border crossings could face disruptions once recreational marijuana becomes legal in Canada on Oct. 17. While legal in several states, the U.S. federal government still classifies marijuana as a banned substance. So effectively, pot-industry workers and investors are seen as contributing to drug trafficking.

ETFs & Stocks to Tap Marijuana Boom

Todd Owen, a senior U.S. Customs and Border Protection official overseeing border operations, told Politico that cannabis investors from countries such as Israel have already been denied entry into the U.S. We dont recognize that as a legal business, he said. Facilitating the proliferation of the legal marijuana industry in U.S. states where it is deemed legal or Canada may affect an individuals admissibility to the U.S.

A CBP spokesperson confirmed marijuana-industry investors could be denied entry, and said thats always been U.S. policy. Generally, any arriving alien who is determined to be a drug abuser or addict, or who is convicted of, admits having committed, or admits committing, acts which constitute the essential elements of a violation of (or an attempt or conspiracy to violate) any law or regulation of a State, the United States, or a foreign country relating to a controlled substance, is inadmissible to the United States, the agency said in an emailed statement.

Last month, Buzzfeed News reported the Trump administration was quietly ramping up its war against marijuana, and U.S. Attorney General Jeff Sessions has been outspoken in his opposition to marijuana legalization.

While Owen told Politico that customs agents probably wont directly ask each Canadian crossing the border if theyve used marijuana, or if they work or invest in the cannabis industry, other factors — such as a smell from a car, or marijuana residue detected by drug-sniffing dogs — could lead to further questioning.

Its common for border agents to ask those crossing the border what they do for a living. If you work for the industry, that is grounds for inadmissibility, Owen told Politico. Lying to agents is also grounds for a lifetime travel ban.

The increased scrutiny will likely lead to longer wait times at border crossings and more Canadians being denied entry, especially as the legal pot industry booms.

Its going to happen even more, and especially now that theyre going after business travellers, its going to be the Wild West at the border, Washington-state immigration lawyer Len Saunders told the Vancouver Star in July. Its going to be crazy.


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