Guidelines from the UK’s financial watchdog allowing medical cannabis companies to list on the London Stock Exchange have been welcomed by those in the sector.
The Financial Conduct Authority (FCA) issued new guidelines on Friday 18 September, clearing medical cannabis companies to list on the London Stock Exchange.
However those that sell cannabis for recreational use will still be banned, even in countries where it is legal, due to the Proceeds of Crime Act (PoCA).
In a statement, the FCA said it was setting out its approach in response to queries from cannabis-related companies and that the guidance was pending following consultation.
“The legal position of purely UK-based medicinal cannabis companies and cannabis oil companies is clear. UK-based medicinal cannabis companies can be admitted to the Official List, if the company has the appropriate Home Office licences for their activities where they are required,” the FCA said.
“Overseas-licensed medicinal cannabis companies and cannabis oil companies are in a different position. These companies may be admitted to the Official List, provided we are satisfied PoCA does not apply and they otherwise satisfy the criteria for listing. Before they are admitted, we will carry out a review of their case where they will need to satisfy us as to the PoCA risk.”
This decision has been welcomed by those in the sector, who described it as ‘long overdue’ and said it should be seen as a big ‘step forward’ for the industry.
“This announcement from The Financial Conduct Authority has long been awaited by the European cannabis industry,” Stephen Murphy, managing director of global cannabis market intelligence firm, Prohibition Partners told Cannabis Health.
“The promise of a London listing has been extremely attractive to cannabis companies for some years and despite previous efforts has failed to materialise in a senior listing for some time.
“The guidance provided by The FCA should be seen as a very positive step forward and demonstrates a willingness by the FCA to engage with cannabis companies who are dedicated to the medical side of the market.
“This will unlock capital that has been badly needed to open up great access to patients across Europe and further legitimise the cannabis industry in Europe.”
It is hoped that the move will bring vital investment into the sector and ultimately increase access for patients.
Steve Moore, of the Centre for Medical Cannabis, added: “We welcome this clarification and the upcoming consultation.
“It’s a long overdue recognition that medicinal cannabis is a distinct category and will hopefully unleash new much needed investment into the sector.”
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