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Report: Twitter And Snapchat's Cannabis Ads In Canada Could Face Legal Punishment

August 1, 2019 8:32 am
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Report: Twitter And Snapchat's Cannabis Ads In Canada Could Face Legal Punishment

Twitter (NASDAQ:TWTR) and Snapchat (NASDAQ:SNAP) are the only two big names in Silicon Valley’s social media alley willing to provide a space for cannabis companies to show ads in Canada. According to MarketWatch report by Max Cherney, this willingness to accommodate cannabis businesses could result in punishment by Canadian law.

What To Know

It's widely known that, although cannabis has been legalized for adult-use in Canada and many U.S. states, some of the big channels for corporate advertising are blocking cannabis-related ads from their users’ screens. Google parent Alphabet Inc. (NASDAQ:GOOG) and Facebook Inc. (NASDAQ:FB) both deny cannabis businesses the possibility of advertising their products in any of their channels, which include Youtube and Instagram, respectively.

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Twitter and Snapchat, however, have been known to run ads from some of Canada’s largest cannabis companies, which include Hexo (NYSE:HEXO), Canopy Growth (NYSE:CGC) and Aphria (NYSE:APHA).

Why It's Important

Health Canada is the body in charge of developing and overseeing the regulation around cannabis advertisement. However, the department has yet to outline specific, non-ambiguous rules for cannabis adverts in social medial. An expert on digital advertising told MarketWatch Health Canada is unlikely to apply severe punishment to these companies because strict outlines for these cases have yet to be developed.

Even though both companies make use of targeting technology to automatically select which users will receive the age-restricted ads, this software is not necessarily a guarantee of government compliance. Failing to comply with regulation could put both the cannabis company and the advertising channel at legal risk.

The outcome of this situation will likely set the ground for the future of digital cannabis advertising in Canada.

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