Stocks in marijuana companies in Canada fell in prices after the federal government of the United States rescinded on a policy enacted during the Obama administration that allowed legal cannabis to be available in many states in the union. The Attorney General of the United States, Jeff Sessions, announced a government memo that it was up to the prerogative of the federal prosecutors to decide whether or not to allocate funds to cases involving cannabis or other demands in their respective districts.
The Attorney general noted that federal prosecutors should strictly adhere to the principles that have been well established to govern all federal prosecutions. Sessions said that the prosecutors should make their decisions based on how severe the crime is and how it impacts the community at large. In 2013, the Obama administration signed a memo that authorized the flourishing of the pot industry in states that have enacted legislation to legalize either medical cannabis or recreational marijuana or even both. The Obama administration also encouraged other states to follow in line and pass laws that would make the growing, sale and use of cannabis legal in their respective jurisdictions.
In the beginning of 2018 on January 1st, the state of California joined eight other states in legalizing the use of marijuana for recreational use under some particular limitations. The Obama administration reserved the right to proceed with prosecutions if the state authorities did not have safeguards implemented to keep marijuana from organized crime and children. The new policies by the Attorney general raise fears that cannabis firms that are today operating free of litigation may face legal battles in court if prosecutors decide to have them investigated for violations of federal law. This also means that the federal government would get itself involved in the prosecution of crimes involving pot even in states that marijuana is completely legal such as California.
In a few hours’ time after the announcement by the US Attorney general, the impact of the news had made inroads into the Canadian pot stock market. The pot companies in Canada have been anticipating an increase in their volume of sales this year after the legalization of marijuana for both medical and recreational use in the most affluent state in the US, California. Canopy Growth Corp is currently the largest cannabis company in Canada and saw a drop on its shares to $32.32 which represented a 105 decline. Since October, the company had seen a triple growth in its value since October last year.