Cannabis

Big Four accounting firm PwC is planning a move into the U.K.'s nascent cannabis market, several people close to the situation have said.

The firm's auditing arm is currently advising a client looking to make a transaction in the space and has another cannabis-related mandate in the pipeline, according to a person close to the matter.

The client interest has spurred the auditor to assess its approach to the topic, and it is currently working with its regulatory and compliance teams to determine how to progress, according to three people with knowledge of the situation.

PwC already has an established cannabis-focused practice in Canada, where medicinal cannabis has been legal since 2001, and recreational use legalised in 2018. Deregulation across North America, including in the U.S. states of California and California, has informed similar moves in the U.K., where regulations around medicinal cannabis were relaxed in 2018.

Due to the strict processes and conditions still in place, PwC is currently navigating issues around the Proceeds of Crime Act and other legislation, a second person with knowledge of the matter said.

The move would make the Big Four giant among the first major multinational firms to venture into a U.K. market gaining increasing levels of mainstream approval. Most recently DLA Piper launched a U.K.-based cannabis law practice.

Law firms and corporations are paying increasing levels of attention to a U.K. cannabis market, which one person close to the sector said was "on the cusp of a boom." The market for cannabis in North America is projected to grow to $37.9 billion by 2024, according to Prohibition Partners, a  research consultancy focused on cannabis. 

In the U.S., Big Four rival Deloitte acquired specialist firm Cannabis Compliance last year. Meanwhile, other professional service firms, including Crowe and BDO, have also expressed an interest in the area, according to the person. 

Last month, Ince Gordon Dadds hired a cannabis law partner from specialist firm Mackrell to kickstart its own practice, with the likes of Allen & Overy, Hill Dickinson, Arnold & Porter, DAC Beachcroft and Memery Crystal having also expanded their offerings in the area.

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