BMA opens the door to cannabis industry

The Bermuda Monetary Authority will allow BMA-supervised entities to conduct business with licensed cannabis cultivators, processors or sellers, as long as the business does not constitute criminal conduct in the jurisdiction in which the business takes place.

“Compliance will be satisfied when the cannabis activity in the foreign country is legal at all levels, including the federal,” the BMA said, ruling out, for now, any such business with US entities, but opening the door to increased business with companies in Canada’s burgeoning cannabis industry.

However, the BMA warned its regulated entities to take care to comply with this distinction. “While cannabis has been regulated and legal since October 2018, in Canada by the Federal Government, given Canada’s proximity to the US, care must be taken to ensure that the US (or any other country where cannabis is not regulated and legal at the federal level) is not the origin of the activity in the Canadian operation,” it said.

The BMA stressed: “The onus will be on the BMA supervised entities to fully understand the applicable laws related to cannabis in the jurisdiction where the business activities are being conducted, including jurisdiction of origin.”

BMA-regulated entities are also responsible for ensuring there is no money laundering, it added, including a risk assessment of the client, as well as customer due diligence or enhanced due diligence, including source of funds enquiries.