Legislation in the US meant to protect banks that want to do business with cannabis companies was approved by a congressional committee.

A three-day meeting session of the House Financial Services Committee concluded on Thursday (March 28) with a 45 to 15 vote in favor of the Secure and Fair Enforcement Banking Act of 2019, otherwise known as the SAFE Banking Act.


The bill could grant protections to banking activities and allow cannabis companies to secure credit lines and other banking options previously unavailable due to the federal illegality of marijuana.

 

Cannabis - Will The Fortune 500 Join The Party?

 
Our Exclusive FREE Report Contains Information You NEED To Know About Cannabis Stock Investing!
 

During her opening remarks on Tuesday (March 26), Committee Chair Maxine Waters (D-CA) said the group’s goal with the bill is to protect consumers. She described it as a holistic approach to criminal justice reform due to the impact of the criminalization of cannabis, particularly on those directly affected by its illegality.

Forbes wrote that the early victory for this bill, despite opposition from the GOP, shows “that the effective marijuana roadblock on Capitol Hill has been lifted by the chamber’s new Democratic majority.”

Marc Adesso, veteran cannabis attorney with law firm Waller Lansden Dortch & Davis, told the Investing News Network (INN) he still expects there to be a lot of time before any action is taken in Congress.

Allison Margolin, cannabis lawyer at Margolin & Lawrence, told INN the act doesn’t help only the marijuana business, but also provides significant relief to all the ancillary industries attached to the cannabis space in the US.

Both lawyers agree that the development of this act signals a clear change in sentiment towards cannabis policy at the government level.

Adesso and Margolin also see the SAFE Banking Act’s potential passing helping another critical cannabis bill still in the works.

“I think that the passing of the SAFE Banking Act could help to signal a larger shift in public opinion that may ultimately help legislation like the STATES Act to gain traction,” Adesso told INN.

The STATES Act is a policy bill aimed at offering similar banking protections and allowing the legal operation of marijuana companies at a state level.

“Obviously this would have a lot of momentum in getting the passing of the STATES Act as well,” Margolin said.

Several multi-state operators in the US have placed heavy bets on the passing of the STATES Act bill.

 

Cannabis - Will The Fortune 500 Join The Party?

 
Our Exclusive FREE Report Contains Information You NEED To Know About Cannabis Stock Investing!
 

Kevin Murphy, CEO of Acreage Holdings (CSE:ACRG,OTCQX:ACRGF), recently told CNBC he still expects to see the passing of the STATES Act sometime later this year or early in 2020.

In response to the SAFE Banking Act vote, Murphy said the bipartisan support for this bill shows the US is a “step closer to aligning federal policies” to aid the cannabis industry.

Bloomberg reported that analysts at Cowen and Eight Capital share a bright outlook on the impact of the SAFE Banking Act.

Cowen analyst Jaret Seiberg indicated to investors that issues remain with Senate support for the bill moving forward, including the fact that Majority Leader Mitch McConnell doesn’t “want to debate cannabis on the floor.”

Mitch Baruchowitz, managing partner at Merida Capital Partners, told the Financial Post this bill would heavily disrupt the state of cannabis business relationships between US and Canadian companies.

“American multi-state operators like Acreage [Holdings] and Curaleaf Holdings (CSE:CURA,OTCQX:CURLF) are much bigger than most Canadian cannabis companies,” he said. “I can’t see the appetite for US banks to lend to most Canadian licensed producers over these multi-state operators.”

Marijuana legalization is poised to be a discussion topic for the upcoming 2020 presidential election, as several Democratic hopefuls to the candidacy have stated strong positive sentiment toward a clear-cut legalization path at the federal level.

Don’t forget to follow us @INN_Cannabis for real-time news updates!

Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: Acreage Holdings is a client of the Investing News Network. This article is not paid-for content.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

 

Cannabis - Will The Fortune 500 Join The Party?

 
Our Exclusive FREE Report Contains Information You NEED To Know About Cannabis Stock Investing!
 

An Emerging Markets Sponsored Commentary

A report just released in early April confirms that the cannabis beverage sector is thriving. According to this report from industry stalwart, Marijuana Business Daily while sales for vapes, pre-rolls and flower were lackluster, cannabis beverages shined:

Keep reading... Show less

BevCanna Enterprises (CSE:BEV,OTCQQ:BVNNF,FWB:7BC) CEO Marcello Leone shared how the company is scaling up its products to forge partnerships and explore opportunities across Canada, the US and Western Europe. 

“Getting your standard processing license and being fully compliant at a federal level is critical in Canada, and we were successful in getting that done. Now we’re getting ready to launch our Keef line of beverages within the next 45 days,” Leone said. 

As a young company, Leone said BevCanna has only started, but it took a four-pronged approach to make sure that it is a revenue-generating company prepared for the opening of many jurisdictions for CBD-based products.

“We are blessed that we have a beautiful infrastructure of our own, a state-of-the-art bottling facility with a capacity of almost 200 million bottles per annum and a strong balance sheet of $55 million. We are in a strong position to scale and grow this company.”

BevCanna has received a Standard Processing License from Health Canada and is now fully authorized to begin production at its full-service, high-capacity beverage manufacturing facility. The company will begin production of its white-label products, number one US cannabis beverage brand Keef and its in-house beverages through licensed Canadian retailers, positioning the company to fully capitalize on the burgeoning Canadian cannabis-infused beverage sector.

Watch the full interview with CEO Marcello Leone above.

Keep reading... Show less

BioHarvest Sciences (CSE: BHSC) will be presenting at the Benzinga Cleantech Small Cap Conference taking place on April 22, 2021. We invite our shareholders and all interested parties to explore cleantech small cap investment opportunities through two days of networking, dealmaking and discovery.

Sign up to get a free spectator pass for the event: https://www.benzinga.com/events/small-cap/clean-tech/

Keep reading... Show less

Positive distributor feedback and strong consumer interest accelerating launch with distributors

Emerging leader in innovative health and wellness beverages and products, BevCanna Enterprises Inc. ( CSE:BEV , Q:BVNNF , FSE:7BC ) (“ BevCanna ” or the “ Company ”) announces today that its wholly-owned subsidiary Naturo Group has successfully completed its initial shipment of TRACE plant-based products to one of Japan’s largest beverage distributors.

Keep reading... Show less

Cresco Labs (CSE:CL) (OTCQX:CRLBF) (“Cresco Labs” or the “Company”), a vertically integrated multistate operator and the number one U.S. wholesaler of branded cannabis products, today announced an additional refreshment of its board of directors to further strengthen its leadership in the cannabis industry.

Keep reading... Show less