THE BLOG
04/30/2019 10:34 EDT | Updated 04/30/2019 10:34 EDT

How U.S. Federal Cannabis Legalization Would Affect Foreign Nationals With Marijuana Ties

It will be welcome news for Canadian employees and investors of cannabis businesses.

Carlos Osorio / Reuters
Cannabis plants fill a room in an aquaponics grow operation by licensed marijuana producer Green Relief in Flamborough, Ontario, Jan. 25, 2019.

During the 115th United States Congress, a number of bills were introduced to legalize marijuana at the federal level. The ones that received the most attention were: (1) theStrengthening the Tenth Amendment Through Entrusting States (STATES) Act, and (2) the Marijuana Justice Act of 2017/Marijuana Justice Act of 2018.

Although the STATES Act and the Marijuana Justice Act (collectively, the "Legalization Bills") died when the 115th Congress ended on January 3, 2019, the STATES Act has been reintroduced in the Senate and in the House of Representatives. The Marijuana Justice Act has also been reintroduced in the Senate and in the House of Representatives.

If either of these legalization bills becomes law, investors and employees of cannabis businesses will no longer be at risk of being banned from the United States as controlled substance traffickers.

Summary of the Legalization Bills

The STATES Act will leave marijuana as a Schedule I controlled substance under the Controlled Substances Act (CSA). However, if a particular state has legalized marijuana, an entity engaged in marijuana-related activities within its jurisdiction will be deemed not to have violated the CSA.

The Marijuana Justice Act will provide for the removal of marijuana and tetrahydrocannabinol (THC) from Schedule I of Subsection 202(c) of the CSA. It will also require each federal court to expunge convictions for any federal offence (but not a state-level offence) involving marijuana use or possession, which occurred before the effective date of the legislation.

Watch: Immigrants can be denied U.S. citizenship for marijuana ties. Blog continues below.

Significance to Foreign Nationals Employed by U.S. Cannabis Businesses

Immigration Nationality Act (INA), Section 212(a)(2)(C) permanently bars a foreign national if there is reason to believe that he or she is (or has been) an illicit trafficker in a controlled substance or any listed chemical (as defined in Section 102 of the CSA, or a knowing assister, abettor, conspirator or colluder in illicit trafficking of such controlled substances. This is the ground of inadmissibility that would typically be applied to employees and investors of cannabis businesses.

Cannabis businesses located in the United States, even in states that have legalized marijuana, still technically operate in violation of the CSA. Any foreign national currently working for (or investing in) a U.S. cannabis business, even one that is operating in compliance with state law, is at risk of being permanently banned under the controlled substance trafficking ground.

If either of these legalization bills becomes law, foreign nationals employed by (or investing) in a U.S. cannabis business operating in compliance with state law will not be inadmissible under INA Section 212(a)(2)(C). However, since the legalization bills are not expected to be applied retroactively, any foreign national who did so prior to federal legalization could still be barred under INA Section 212(a)(2)(C).

Significance to Foreign Nationals Employed by Canadian Cannabis Businesses

If the STATES Act becomes law, foreign national employees and investors of Canadian cannabis companies should be able to enter the United States for matters related to the marijuana industry, as long as their activities occur in a state that has legalized marijuana. However, travelling to a state that has not legalized marijuana could expose the foreign national employee or investor to a permanent bar under INA Section 212(a)(2)(C), even if the proposed activity is considered a non-criminal violation of that state's laws.

If the Marijuana Justice Act become law, it may also be possible for foreign national employees and investors of Canadian cannabis companies to travel to states that have not legalized marijuana, for matters related to the marijuana industry, without being barred under INA Section 212(a)(2)(C). However, they would need to ensure that the proposed activity would not be considered a criminal offence under that state's laws.

Regardless of which legalization bill becomes law, it will be welcome news for employees and investors of cannabis businesses. However, it could take another 24 months (possibly longer) before federal legalization actually occurs.

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