The new changes announced today provide a revision to the regulations and will have a substantial impact on the following areas: travel, telecom, building materials and agricultural equipment, financial services, personal importations.
• Travel to Cuba for tourist related activity is still not authorized. “Specific licenses” will not be necessary if you are traveling to Cuba as one of the 12 “authorized travelers”. Instead, “authorized travelers” will now be able to travel to Cuba under a “general license,” the major difference being under a general license “authorized travelers” can travel to Cuba without the requirement of having to first apply to the OFAC and receive a license prior to travel.
• The 12 authorized traveler categories are:
1. family visits;
2. official business of the U.S. government, foreign governments, and certain intergovernmental organizations;
4. professional research and professional meetings;
7. public performances, clinics, workshops, athletic and other competitions, and exhibitions;
8. support for the Cuban people;
9. humanitarian projects;
10. activities of private foundations or research or educational institutes;
11. exportation, importation, or transmission of information or information materials; and
12. certain export transactions that may be considered for authorization under existing regulations and guidelines.
• For example, “professional research and professional meetings” is one of the 12 authorized traveler categories. OFAC published a frequently asked questions related to Cuba and clarified that “professional research in Cuba [must be] relating to a traveler’s profession, professional background, or area of expertise. The traveler’s schedule of activities must not include free time or recreation in excess of that consistent with a full-time schedule.” The new regulations further clarify that “professional” travelers cannot engage in travel in pursuit of a hobby, or research for personal satisfaction only.
• Airlines and travel agents are permitted to provide authorized travel services and authorized remittances without specific licenses to OFAC. Airlines will need to secure approvals from other U.S. government agencies including the Federal Aviation Administration. Travel agents must maintain names and addresses and appropriate backup to confirm the traveler is “authorized” for 5 years. Once airlines have service, authorized travelers may book directly with the airlines, but, similarly the authorized traveler must maintain records for 5 years to prove the travel was “authorized”.
• Insurance companies are now authorized to provide travel insurance for “authorized” travelers.
The following transactions are now authorized without a license:
• Exports to Cuba of certain consumer communications devices, including computers, communications equipment and related items, mobile phones, televisions, radios and digital cameras and memory cards, batteries, related software, applications, hardware, either sold or donated.
• Exports of items for the establishment and update of communications-related systems will be authorized.
• Access to the Internet, use of Internet services, infrastructure creation and upgrades is now authorized. This week, Facebook CEO launched internet.org in Colombia, perhaps he will now consider Cuba.
• All transactions, including payments, incidental to the provision of telecommunications services involving Cuba, including roaming agreements, are authorized.
• All transactions, including payments, relating to the establishment of telecommunications facilities, including fiber-optic cable and satellite facilities connecting Cuba with the U.S. or third countries are authorized.
• “Telecommunications services” include data, telephone, Internet, radio, television and news wire feeds, regardless of medium of transmission.
3. Building Materials, Tools, Equipment and Supplies
The following commercially sold or donated items may now be exported to Cuba without a license:
• Building materials, and tools for use by the private sector to construct or renovate privately-owned buildings, including privately-owned residences, businesses, places of worship and buildings for private sector social or recreational use;
• Tools and equipment for private sector agricultural activity; and
• Tools, equipment, supplies, and instruments for use by private sector entrepreneurs. Note that this provision will, for example, allow the export of such items to private sector entrepreneurs, such as auto mechanics, barbers and hairstylists and restaurateurs.
4. Financial Services
• “Authorized travelers” to Cuba are able to use their U.S. credit and debit card with removal of the per diem spending limit.
• The amount of authorized remittances authorized travelers to Cuba may carry has been increased to $10,000 per trip.
• The limit of a general remittance to a Cuban national has been raised from $500 to $2000 per quarter.
• Banking institutions, U.S. registered brokers, and U.S. registered money transmitters are permitted to process authorized remittances without a license.
• U.S. institutions are permitted to open correspondent accounts at Cuban financial institutions to facilitate the processing of authorized transactions.
• The regulatory definition of “cash in advance” is revised to specify that it means “cash before transfer of title,” providing more efficient financing of authorized trade with Cuba.
5. Personal Imports
• “Authorized travelers” to Cuba are authorized to import into the U.S. $400 worth of goods from Cuba, of which no more than $100 can consist of tobacco products and alcohol combined, for personal use only.
There is no clarity on how, or if, enforcement any of these limited license exceptions will take place.