Canadian Securities Administrators (CSA) staffers have seen “inadequate transparency” at cannabis companies in the country and are telling these companies to improve their disclosures of cross-holdings.

A Canadian regulator had told the companies to improve on offering conflict of interest disclosures relating to mergers and acquisitions.

The Canadian Securities Administrators said its staff had seen “instances of inadequate transparency relating to the cross-ownership of financial interests” among public marijuana companies, executives and board members.

The administrators also said staff at the various regulators under its umbrella had observed “recent examples” where “corporate governance related disclosures were deficient.”

“As the market has expanded, many cannabis issuers and their directors and executive officers have participated in the financing of other cannabis issuers, resulting in higher than usual crossover of financial interests,” said the CSA. These can include overlapping debt and equity, or other business relationships.

Canada’s CSA is an umbrella organization that assists provincial regulators in coordinating their regulatory actions and policies, as well as other things.

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