Canadians about to enjoy newly legal marijuana - and even investors in the sector - could face new headaches at the U.S. border.
Border guards have broad power to question Canadians on their current and past drug use, immigration experts say. They could declare users inadmissible - perhaps for life. U.S. officials also warn that any form of participation in the sector could likewise cause someone to be turned away, signaling potential problems for investors.
Canada is scheduled to legalize recreational use of the drug on Oct. 17, but it is still illegal under U.S. federal law, despite major states like Colorado and California loosening restrictions. Justin Trudeau’s government and travel agents are warning Canadians to make sure they have no trace of the drug in their cars or luggage.
“Working or having involvement in the legal marijuana industry in U.S. states where it is deemed legal or Canada may affect an individual’s admissibility to the U.S.,” Mike Niezgoda, a spokesman at the U.S. Customs and Border Protection office in Buffalo, said in an email.
Similar comments made by a border official to Politico sent U.S.-traded shares of Canadian marijuana companies tumbling Thursday. Cannabis stocks have been soaring since mid-August, when Canopy Growth Corp. announced a C$5 billion ($3.8 billion) investment from Constellation Brands Inc., the biggest deal in the sector to date.
“A lot of people don’t understand that they are still going to have problems after legalization,” said Henry Chang, a partner at Blaney McMurtry LLP in Toronto who handles immigration law on both sides of the border. “You need to stay off the radar - if there’s something that prompts them to think that you are a marijuana user, the first question will be: ‘Do you smoke marijuana?’”
Those at risk include people in border towns who frequently cross over to buy gas or milk, tourists and transport workers who haul billions of dollars a month of goods into the U.S. Even executives at weed companies could be accused of bringing the trade where it’s not welcome.
The rub is that it’s illegal to have smoked the drug in Canada before Oct. 17, and it’s illegal to lie to any border agent who asks about it. Some 4.6 million Canadians - about 16 percent of the adult population - use weed.
“Although medical and recreational marijuana may be legal in some U.S. States and Canada, the sale, possession, production and distribution of marijuana remain illegal under U.S. federal law,” Niezgoda said.
Another official said those participating in the marijuana business may be turned away at the border. “Facilitating the proliferation of the legal marijuana industry in U.S. states where it is deemed legal or Canada may affect an individual’s admissibility to the U.S.,” Todd Owen, executive assistant commissioner for the Office of Field Operations at the U.S. Customs and Border Protection agency, told Politico in comments published Thursday.
Although Owen didn’t specify any minimum level of investment, he signaled that the focus was more on those bringing the sector to the U.S., which could have implications for the burgeoning sector. Until his comments, the BI Canada Cannabis Competitive Peers index had gained nearly 50 percent since the Canopy-Constellation deal was announced. Individual stocks have posted more outsize gains, with Tilray Inc. up more than 600 percent since its July IPO.
Canadian Public Safety Minister Ralph Goodale has often said he’s working with U.S. law enforcement to clarify the changes and make sure the border remains smooth. The advice of Goodale and Trudeau is to be honest at the border - and to make sure you’re not carrying.