The Missouri Legislature introduced a bill, HB 906, to limit the ownership in cannabis businesses by out-of state investors to 25%. The bill does not address whether a publicly traded company can qualify as an investor or whether a suitability determination is required for either individuals or large shareholders of a publicly traded company.
Missouri’s bill is the latest state to allow out-of state investors. Both Colorado and Washington recently introduced bills opening up investment in the cannabis industry. Access to new capital is needed to help the cannabis industry address the lack of traditional financing.
The Colorado House Bill 19-1090 would allow publicly traded companies, and unlimited investors from outside of Colorado, to invest in and own marijuana businesses. House Bill 19-090 repeals the ban on investors in marijuana businesses that are publicly traded companies, and repeals the 15 person limit on the number of out-of-state investors. The proposed amendments require controlling beneficial owners to make certain disclosures, and proposes a process for the cannabis regulator to evaluate the suitability of these investors.
The Washington Legislature introduced four (4) bills to allow non-residents and foreign companies to invest in cannabis businesses. Currently, Washington requires owners of cannabis businesses to be state residents. Washington’s bills make a simple amendment the cannabis licensing requirements to allow for outside investment.
The following links provide additional information about the recent developments in Colorado and Washington.