Cuba: The Year in Review
:• authorized travel to Cuba pursuant to different travel categories without having to request a specific license from OFAC,• removed certain restrictions on financial institutions subject to US jurisdiction,
• authorized credit card and debit card usage in Cuba and correspondent banking agreements between US and Cuban financial institutions, and
• expanded the list of products that may be exported to Cuba pursuant to license exceptions and the types of transactions that may be undertaken in Cuba pursuant to general licenses and therefore without having to request a specific license from BIS or OFAC.On September 21, 2015, BIS and OFAC further amended the EAR and CACR, respectively.
These additional regulatory changes, for example:
• removed limits on remittances to Cuba,
• authorized the physical presence in Cuba of certain persons subject to US jurisdiction,
• further removed certain restrictions on financial institutions subject to US jurisdiction, and
• authorized the provision and receipt of legal services for and from Cuban nationals for transactions permitted by the amended regulations.
Conversely, Cuba has directly or indirectly agreed to increased engagement and commerce generally and with the United States in particular by:
• authorizing a direct correspondent banking agreement by Banco Internacional de Comercio S.A. (BICSA) with Florida-based Stonegate Bank,
• authorizing Stonegate Bank to issue a Debit MasterCard for use in Cuba with expansion for use at ATM locations starting in 2016 (although credit cards remain unauthorized),• promulgating its second Portfolio of Foreign Investment Opportunities, and
• entering into debt settlement agreements with various creditors, including the Paris Club. Various obstacles continue to prevent substantial engagement of and commerce with Cuba, however.
• the Cuban embargo, which may only be lifted by an official act of Congress, and
• Cuba’s lack of access to capital in the form of international finance from individual countries or multilateral institutions (i.e. the World Bank).Despite this, steps continue to be taken towards the normalization of relations between the two countries. For example:• Cuba and the United States have commenced discussions of the claims currently held by USnationals for property expropriated by the Cuban government after 1959, and
• President Obama has expressed his interest in visiting Cuba in 2016 if the conditions are right (i.e. ability to speak to pro-democracy dissidents).
Thus, the next year may feature further normalization of relations between the two countries and additional changes to the regulations governing the presently-in-place Cuban embargo, which may only be completely lifted by an act of Congress.The Latin America Group at Hunton & Williams will continue to closely monitor related developments. Please contact us if you have any questions or would like further information regarding any of the regulatory changes in the past year, or any other regulation or sanction governing the Cuban embargo.