OFAC Revises Restrictions on Dealings with Cuba
Commentary by James Treanor
The Office of Foreign Assets Control ("OFAC") published amendments to the Cuban Assets Control Regulations ("CACR") and issued an updated list of Frequently Asked Questions ("FAQs"). OFAC's action is in furtherance of the policy shift announced by President Obama in December 2014 and designed to "engage and empower the Cuban people." OFAC published an initial round of CACR amendments that, among other things: (i) facilitated certain travel to Cuba; (ii) relaxed restrictions on authorized remittances and (iii) permitted certain activities related to telecommunications, financial services, shipping and other areas.
The current amendments allow authorized travelers to open and maintain bank accounts in Cuba in order to access funds for authorized transactions. The amendments also authorize persons subject to U.S. jurisdiction to establish and maintain a business presence in Cuba – including subsidiaries, branches, offices, joint ventures, franchises and agency or other business relationships with Cuban individuals or entities – in order to provide authorized telecommunications and internet-based services. With respect to the transfer of funds, the current amendments remove limitations on the amount of donative remittances that may be sent to most Cuban nationals and unblock certain previously blocked transfers.
Commentary
While the CACR amendments represent another step towards easing sanctions, the Cuba embargo remains firmly in place and most transactions with the country are still prohibited. Any company wishing to take advantage of the relaxed restrictions, for example, with respect to the provision of telecommunications and internet services, must proceed with caution and fully understand the many prohibitions that remain in place.