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Bridging the Gap to Cuba

Maria del Carmen Ramos

Maria del Carmen Ramos

Last December, President Barack Obama announced a series of changes to the United States’ policy toward Cuba. The most significant changes, from a foreign policy perspective, included restoring diplomatic relations with Cuba and opening a U.S. embassy in Havana. But the announced changes also included easing the restrictions on the ability of Americans to travel to and do business with Cuba. Recently, the current administration promulgated amended regulations implementing the policy changes President Obama announced in December.

While the decision to restore diplomatic relations with Cuba has been far and away the most controversial policy change, the question we get the most is how the amended regulations will impact the ability of Americans to travel to Cuba. As you might imagine, trying to read the amended regulations is no easy task. So we thought we would summarize the travel-related regulatory changes for our blog readers. To understand the recent changes to the Cuban travel policy, it is helpful to start with a brief history.

Travel to Cuba is regulated under the Cuban Assets Control Regulations (“Regulations”). Those Regulations, which are administered by the Department of Treasury’s Office of Foreign Assets Control, were initially promulgated in 1963 under the Trading with the Enemy Act. Naturally, it would be difficult to summarize the Regulations in their entirety in this blog post, but suffice it to say, they impose a number of travel-related restrictions, among other things.

For starters, the Regulations require persons subject to U.S. jurisdiction to be licensed to travel to, from, or within Cuba. In addition, the Regulations limit travel to Cuba to one of the following twelve purposes: family visits, official government business, journalistic activity, professional research and meetings, educational activities, religious activities, public performances or competitions, support for the Cuban people, humanitarian projects, activities of private foundations or research or educational institutes, transmission of information or informational materials, and certain export transactions. Finally, the Regulations generally restrict the types of transactions a person can engage in while in Cuba.

Before the most recent amendments, the Office of Foreign Assets Control twice amended the Regulations under President Obama. In both cases, the amendments were intended to ease travel restrictions to allow for greater contact with the Cuban people. The most recent amendments to the Regulations likewise ease travel restrictions and promote great contact with the Cuban people in the following respects:

Increasing the Number of General Licenses Available for Travel to Cuba: Since the Regulations were initially promulgated, travel to Cuba has been–and remains–limited to the twelve enumerated categories identified above. Travelers whose visit falls within one of those twelve categories is eligible for either a general or specific license. A traveler who meets all of the criteria for a general license does not need permission from the Office of Foreign Assets Control to travel to Cuba; a traveler whose trip falls within one of the twelve categories but does not qualify for a general license must apply for a specific license. The most recent amendment to the Regulations increases the types of travel (within the twelve categories) that qualify for a general license. Although the Regulations expand the number of general licenses available for travel to Cuba, travel for simply the sake of tourism is still banned. 

Air Carriers No Longer Need to Obtain Authorization from OFAC: Previously, carrier services—defined as any person subject to U.S. jurisdiction wishing to provide carrier services to Cuba by aircraft or vessel—were required to obtain authorization from the Office of Foreign Assets Control. Now, any person subject to U.S. jurisdiction is authorized to provide “carrier services.”

This should be an interesting development as flights to Cuba traditionally have been run by licensed charter operations.  Before the most recent amendments, most travel to Cuba required a connecting flight out of Miami or a third country, such as Mexico, Bahamas, or Grand Cayman. After the most recent changes, however, JetBlue Airlines (who has been offering a direct flight from Tampa to Havana since 2011 through its partnership with ABC Charters) plans to add a new nonstop route to Havana starting in June of this year.  Other major commercial airlines, such as American Airlines, Delta Air Lines, and United Airlines, are expected to also offer direct flights in the next year or so.

Travel Service Providers No Longer Need to Obtain Authorization from OFAC: Travel service providers include a person wishing to provide any services in connection with travel to Cuba—such as travel agent, ticket agents, tour operators, etc. As with air carriers, any person subject to U.S. jurisdiction is authorized to provide travel services in connection with travel to Cuba.

No More Spending Limits for Travelers: Under previous versions of the regulations, travelers were permitted to pay for living expenses and goods for personal consumption while in Cuba. But those expenses could not exceed the “maximum per diem rate” for Havana, Cuba in effect at the time of travel. The “maximum per diem rate” was published in the Department of State’s “Maximum Travel Per Diem Allowances for Foreign Areas.” Under the most recent amendments, there is no limit on living expenses. In addition, travelers may bring back up to $400 in merchandise with them (provided that no more than $100 of the merchandise is alcohol or tobacco products).

Travelers are Permitted to Use Debit and Credit Cards: Before the most recent amendments, travelers were expressly precluded from engaging in any transaction involving a credit card or debit card, unless specifically authorized to do so. That prohibition was deleted by the most recent amendments. Now, travelers can engage in credit card and debit card transactions.  But while this may legally be case, keep in mind that there are few ATMs in Cuba, and it will be awhile before many establishments have the means to process credit card payments. As such, many transactions will still require cash.

Obviously, this is just a summary of some of the recent changes that could affect prospective travelers to Cuba. There are, of course, other changes to the Cuban travel policy, and many more that relate to doing business with or sending money to Cuba. If you are planning on traveling to or interested in doing business with Cuba, you would be wise to consult with an experienced legal professional. 

For more information, please contact Maria del Carmen Ramos at 813.227.2252 or mramos@slk-law.com. 

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