BIS, OFAC Unveil Newest Set of Regulatory Changes for Cuban Trade, Travel
The Bureau of Industry and Security and the Office of Foreign Assets Control issued concurrent final rules to expand a set of mechanisms to ease trade and other dealings with Cuba. The regulatory changes are the first administrative action on Cuban trade since the removal of Cuba as a State Sponsor of Terrorism in July (see 1507210028). The newest changes, which take effect on Sept. 21, build on rules issued by BIS and OFAC in January to initiate closer ties with Cuba (see 1501150031). The following is a round-up of the most critical aspects of the changes.
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Expansion of the License Exception Support for the Cuban People
The BIS rule (here) removes a requirement that U.S. exporters must sell or donate when exporting or reexporting to authorized Cuban end-users. The provision focused on improving living conditions and private sector activity in Cuba, but may add unintentional confusion, said BIS in the new rule. “The construction of the sentences addressing sales or donations inadvertently precluded other types of exports and reexports intended to be covered under the license exception, such as those involving leased or loaned items,” said BIS in the new rule.
BIS is also now authorizing some temporary reexports to Cuba. The January rule opened the door for temporary exports from the U.S. to Cuba of items related to “scientific, archeological, cultural, ecological, educational, historic preservation, or sporting activities, or in the traveler’s professional research.” This rule allows travelers to export those items to Cuba from the U.S., as well as third-party countries. BIS also adds “professional meetings” to the list of eligible end-users, while emphasizing that the goods must stay in the traveler’s “effective control.”
Additionally, the rule paves the way for exports of commodities and software used to develop software that will strengthen the free flow of information in Cuba, as well as items that may be distributed as gifts for “promotional purposes, such as pens, notepads, hats and t-shirts.” Among other changes to the Support for the Cuban People license exception, BIS is also authorizing some temporary exports for items on the Commerce Control List “only for anti-terrorism reasons.”
Expansion of License Exception Consumer Communications Devices
BIS is also removing the sales or donations language from the CCD license exception, which authorizes exports and reexports to improve information flow in Cuba and Sudan. BIS said the language created the same confusion regarding leased and loaned items.
Availability of License Exception Aircraft, Vessels and Spacecraft
The final rule authorizes temporary sojourns to Cuba for some vessels, such as those for hire for use in goods transport, passenger vessels for hire and use in passenger and item transport and recreational vehicles that are used in compliance with Treasury Department travel regulations. The new language allows aircraft on temporary sojourn to stay in Cuba for up to seven consecutive days. Vessels on temporary sojourn can now stay in Cuba for up to 14 consecutive days.
Travel and Related Services
The OFAC final rule (here) authorizes persons subject to U.S. jurisdiction to “provide carrier services by vessel, without the need for specific licenses from OFAC, and to add an authorization to provide certain lodging services aboard such vessels in connection with such transportation.” The OFAC changes also expand family visit authorizations and allow authorized travelers to open bank accounts in Cuba.
Physical Presence in Cuba
Both rules allow U.S. persons to establish and maintain a physical presence in Cuba. That can take the form of an office, retail outlet or warehouse for the following activities: news bureaus, authorized exports, mail or parcel transmission services and some cargo transportation services, communication providers, educational activities, religious organizations and carrier and travel services.
Remittances
OFAC removed limitations on donative remittances to Cuban nationals unaffiliated with banned end-users in the Cuban government and Communist Party. The rule removes the limit on the amount of remittances that a Cuban national permanently residing in Cuba, and who is departing the U.S., may carry. Additionally, OFAC is removing a set of previous mechanisms used to block remittances and funds transfers, among other measures.
(Federal Register 09/21/15)