In Asia, and specifically China, adherence to principles of the 1961 United Nations Single Convention on Narcotic Drugs, prevents the distribution of consumable products derived from hemp of low THC content (hemp 0.3% and below). Although a date has not been published, speculation is that a repeal of this law is anticipated as early as June 2020. The recommendation for the repeal came from an open letter from the Director-General of the United Nations’ World Health Organization to the United Nations, dated January 24, 2020.
If implemented, the repeal would remove restrictions and usher in the ability for all CBD industries to be fully commercialised across this vastly populous region. This will include pharmaceuticals, nutraceuticals, edibles and every other hemp CBD related product. Currently, consumable CBD products are restricted for sale in China to those with licenses, other than with respect to CBD infused skincare, cosmetic and other non-ingestible goods.
James Foster, CEO of CGA noted: „The proposed repeal represents a very unique opportunity to monetise and create new market opportunity of such a large scale in Asia. Canrim is positioned strategically to take advantage of this through our development work over the past few years, and my Asia team assembled over past 10 years.”
The repeal would represent significant growth opportunities in China and elsewhere in Asia, with some estimating the global industry to be as large as US$26 billion, led largely by Asia and specifically China, with pharmaceutical products expected to represent the largest market segment.
The relaxation of regulations in China represent remarkable opportunities for CGA’s investment and distribution businesses, as CGA will be able to seamlessly onboard new products through the iBloom platform and CGA’s network and distribution channels, which currently have been designed to act as a conduit and first mover for the significant CBD cosmetic product market. Should current regulations respecting CBD pharmaceutical, nutraceuticals and edibles be relaxed in China, as is currently expected, it would create significant new market opportunities for CGA and by extension, Canrim, beyond its current ambitions of being a first mover in the Chinese CBD cosmetic products industry.
The developments of COVID19 (or the Coronavirus) in Asia are not anticipated to have a material effect on CGA’s business model, as most of CGA’s sales channels operate online and through mobile applications and not through physical retail. As consumers are not obligated to shop through supermarkets or malls and simply by making in-app purchase, it is business as usual. Customs and logistics in Asia, specifically China, continue to operate as normal and therefore CGA’s model has been unaffected during this testing time.
Further of note is many of the main 'Tier one’ cities in China including Shanghai, Shenzhen, Guangzhou and others are almost operating at 100% efficiency at this stage. Coronavirus had not taken any significant effect in these areas. These higher GDP per Capita urban places are where CGA and NSG’s primary distribution network operates. Areas such as Wuhan or the greater Hubei province are not apart of any of the corporations’ current business model. So once again, COVID19 is not currently applicable to our roll out or business plan.
www.sedar.com.” data-reactid=”37″>Final acceptance of the Proposed COB will be subject to completion of certain other conditions, including delivery of completed application documentation to the CSE and closing of the Offering. As previously announced, the Offering is for units of the Corporation („Units„), with each unit being issued at a price of $0.20, for aggregate gross proceeds of a minimum of CAD$2,000.000. Each Unit comprises one (1) common share of the Corporation and one-half (1/2) of one common share purchase warrant. Each whole purchase warrant will be exercisable for one common share of the Resulting Issuer (as defined below) for a price of $0.30 per common share for a period of one year. Information respecting the Proposed COB and all matters in connection therewith, including those matters approved by shareholders at the Meeting, can be found in the Corporation’s management information circular dated January 29, 2020 and filed under the Corporation’s profile on www.sedar.com.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction.
ANY SECURITIES REFERRED TO HEREIN WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 (THE „1933 ACT”) AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO A U.S. PERSON IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT.
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF U.S. SECURITIES LAW.
https://www.newsfilecorp.com/release/52929” data-reactid=”47″>To view the source version of this press release, please visit https://www.newsfilecorp.com/release/52929