New Changes to Sanctions on Cuba Provide New Array of Business Opportunities in Cuba–What You Should Know

Sanctions against Cuba continue to lift. Effective this week, the Department of Treasury’s Office of Foreign Assets Control (OFAC) and the Department of Commerce’s Bureau of Industry and Security (BIS) have relaxed controls in several areas of trade and commerce with Cuba, including loosening restrictions on exporting to and importing from Cuba, carving out new allowances for U.S. persons entering into contingent contracts with Cubans, and opening new opportunities for American entrepreneurs in the civil aviation, construction, and health sectors. Among the changes is also a provision that will allow Americans to travel to Cuba to attend professional meetings and conferences related to tourism.

Some of the most important changes for U.S. business include:

  • An OFAC general license authorizing U.S. persons to negotiate and enter into certain contingent contracts for transactions currently prohibited by the Regulations. Performance of the contracts, which includes any exchange of money, remains prohibited without prior authorization from the U.S. government. Businesspersons may travel to Cuba to negotiate such contacts by using the general license authorizing travel for professional meetings.
  • While previous changes to the sanctions authorized travel to Cuba in order to attend professional meetings and conferences in Cuba, those changes excepted meetings and conferences related to tourism in Cuba. That exception has now been removed, allowing Americans not only to attend but also to organize tourism-related meetings and conferences in Cuba.
  • Americans may now service and repair items that were previously exported or reexported to Cuba. If replacement parts are required, a separate authorization is still required.
  • OFAC is adding a new general license to allow U.S. persons to provide Cuba and Cuban nationals, wherever located, services aimed to ensure safety in civil aviation and safe operation of commercial aircraft.
  • U.S. persons may now provide services related to developing, repairing, maintaining, or enhancing certain Cuban infrastructure projects that benefit the Cuban people, including public transportation, water and waste management, non-nuclear electricity generation, and electricity distribution projects. Authorized projects also include the construction of hospitals, public housing, and schools. Services rendered in performance of these projects must still comply with licensing policies of BIS.
  • Commercial joint medical research is now authorized under an amended OFAC general license.
  • BIS has extended a license exception to generally authorize aircraft carrying cargo to temporarily land and unload in Cuba, extending to aircraft allowances that previously applied to vessels on temporary sojourn to Cuba.

Less important to business but getting the most news attention, recent changes also remove monetary limits on the amount of Cuban cigars and alcohol that tourists may carry in their luggage to the United States provided that these items are for personal use.

If you have specific questions related to your business and opportunities in Cuba, as always, please feel free to contact me.

Have a great day!

Doreen