Office of Foreign Assets Control
Publication of Amended Cuban Assets Control Regulations (CACR) and Related Frequently Asked Questions
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is amending the Cuban Assets Control Regulations, 31 C.F.R. Part 515 (CACR) to further implement portions of the President’s foreign policy toward Cuba. Among other things, these amendments increase support for internet freedom for the Cuban people and independent Cuban private sector entrepreneurs by expanding authorizations for internet-based services and a range of financial transactions. The rule will be published in the Federal Register on Wednesday, May 29, 2024.
OFAC is also issuing six new, Cuba-related Frequently Asked Questions (FAQs 1174-1179) and amending eight Cuba-related Frequently Asked Questions (FAQs 732, 736, 745, 748, 757, 769, 770, and 785).
Please visit this link for more information on today's update.
OFAC Final Rule https://static1.squarespace.com/static/563a4585e4b00d0211e8dd7e/t/6655dde4739fac76d73e2a97/1716903396355/2024-11618.pdf
See below for key OFAC Frequently Asked Questions
https://www.washingtonpost.com/national-security/2024/05/28/us-cuba-sanctions-biden-trump/
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CENTER FOR ENGAGEMENT AND ADVOCACY IN THE AMERICAS APPLAUDS NEW REGULATIONS SUPPORTING CUBAN ENTREPRENEURS AND MODERNIZING U.S. CUBA POLICY
Washington, DC, May 28, 2024 - The Center for Engagement and Advocacy in the Americas (CEDA) welcomes today’s regulatory changes announced by the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) aimed at bolstering support for Cuban entrepreneurs and modernizing U.S. policy towards Cuba.
Today's announcement represents a significant step forward in empowering the Cuban people and fostering constructive engagement between the United States and Cuba. By expanding access to internet-based services, facilitating financial transactions, and supporting independent entrepreneurship, these regulations signal a positive shift away from outdated Cold War-era policies towards a more logic-driven and people-centered approach.
"These updates are significant. We applaud the Biden administration's decision to listen to the voices of Cuban entrepreneurs and civil society and take meaningful steps to support their aspirations for a brighter future," said María José Espinosa, the Executive Director of CEDA. "For so long, outdated US trade regulations have made the lives of Cuban entrepreneurs markedly more difficult than they already are, as they endure restrictive regulations from both the U.S. and Cuban governments. Under these new regulations, Cuban entrepreneurs can process payments, hold a US bank account, and receive “U-turn” funds. This will have a positive impact on the Cuban private sector, which is in dire need of support.”
CEDA emphasizes the importance of heeding the recommendations of Cuban entrepreneurs and civil society actors in shaping U.S. policy towards Cuba. In July 2023, CEDA led a delegation of Cuban entrepreneurs to meet with policymakers in Washington. The entrepreneurs shared their recommendations on updating US trade policy, many of which are reflected in today’s amendments.
"These regulatory changes reflect a growing recognition that U.S. policy towards Cuba must prioritize engagement with the people, civil society organizations, and private businesses in Cuba," added Espinosa. "It is high time for the U.S. government to take actions that reflect its aims of supporting the Cuban people. If increased economic freedom is an objective, the US must end all unnecessary restrictions on Cuban private businesses.”
CEDA calls on the Biden administration to build upon these positive steps by further easing restrictions on travel, trade, and financial transactions with the Cuban people, removing Cuba from the State Sponsors of Terrorism list, and by working towards the normalization of diplomatic relations between our two countries.
Stay tuned for an upcoming webinar with U.S. and Cuban experts to dive deeper into the updated regulations and their potential impacts.
For media inquiries, please contact Isabel Albee at isabel@weareceda.org
https://www.weareceda.org/en/press-releases/center-for-engagement-and-advocacy-in-the-americas-applauds-new-regulations-supporting-cuban-entrepreneurs-and-modernizing-us-cuba-policy
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U.S.-Cuba Trade and Economic Council Eye on Cuba
Biden-Harris Administration Issues OFAC Regulations To Help Cuba's "Entrepreneurs" But Again Fails To Make The Most Important Change.
- May
28, 2024
- While useful for the Biden-Harris Administration (2021- ) to redefine the
word "entrepreneur" and to further expand Internet-related activities for
entrepreneurs, and to permit entrepreneurs to possibly have a less complex
banking transaction process outside of United States, and to authorize
entrepreneurs to have bank accounts in the United States, there remains one
glaring omission- the continuing prohibition upon direct correspondent
banking.
- As long as financing, investment, and payments need to be routed through
third countries, the Biden-Harris Administration will be constraining precisely
the activity it professes to support.
- LINK: 10 May 2024 Marked Two-Year Anniversary Since OFAC Issued First License To Authorize Investment And Financing Into A Private Company In Cuba. Funding Waits Because Havana Has Yet To Issue Regulations May 13, 2024
https://www.cubatrade.org/blog/2024/5/28/miow5axraqxay6msl8uk83t6lg2lar
(Includes full text of White House background briefing)
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May 28, 2024 News & Updates, Press Releases
ACERE Celebrates New Regulations In
Support Of Cuban Entrepreneurs
The measures revealed today allow independent Cuban entrepreneurs to legally open and operate U.S. bank accounts from Cuba; access U.S. internet-based services, software and payment platforms; and benefit from the reauthorization of U-turn transactions, or Cuba-bound remittances and other forms of payment that originate in a third country and pass through the U.S. financial system. By amending existing Treasury Department rules, today’s announcement updates the definition of “self-employed individual” to reflect the growing diversity of the Cuban private sector, and allows for new classes of exports to the U.S. by Cuban private businesses, such as software and mobile applications .
Demands for these changes, among many others, were included in a letter sent by thousands of Cuban private business owners to the Biden administration last year encouraging bold action to support their expansion and facilitate their access to capital, banking and internet-based services. This initiative built off of earlier efforts from Cuban entrepreneurs — later taken up by their Cuban-American friends and family — urging sanctions relief and U.S. support for this growing sector of the Cuban economy.
In light of today’s announcement and the administration’s recent removal of Cuba from the list of countries not cooperating with counter-terrorism efforts, ACERE reiterates its call for the administration to lift Cuba’s designation as a state sponsor of terrorism, resume regular processing of nonimmigrant visas at the U.S. Embassy in Havana, and remove other travel and trade-related restrictions imposed under the Trump administration that serve to undermine the growth of Cuba’s private sector.
Without removing Cuba from the SSOT list, U.S. and foreign financial institutions will continue to face onerous due diligence requirements in implementing these regulatory changes to the extent that the Biden administration hopes. Ending the SSOT designation is necessary to remove barriers, real and perceived, that third-country banks and financial institutions face in providing services to Cuba’s independent entrepreneurs. Cuba’s rescission from the list is also vital to encourage the resumption of European tourism to Cuba, which particularly benefits Cuba’s private AirBnb hosts, restaurateurs, taxi drivers, agricultural producers, cultural workers and others.
Resuming nonimmigrant visa processing in Havana would help facilitate Cuban entrepreneurs’ travel to the United States for business activities and the marketing of their goods and services, as well as their acquisition of essential U.S. products for use and sale in their businesses on the island.
Furthermore, ACERE encourages the Biden administration to issue a general license authorizing U.S. individuals and companies to invest in and provide other modes of financing for Cuba’s independent private entrepreneurs, as well as explore ways to allow two-way direct correspondent banking between U.S. and Cuban financial entities.
While ACERE expresses concern that these measures took two years to implement after having been announced in May 2022—reportedly over pressure from members of Florida’s congressional delegation—today’s announcement shows that the Biden administration can and should pursue a foreign policy toward Cuba that not only bolsters the operations and market share of U.S. businesses and service providers on the island, but also supports the Cuban people and civil society by removing obsolete, U.S.-imposed restrictions.
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Contact: Ricardo Herrero
Phone: 202-709-8191
CUBA STUDY GROUP APPLAUDS BIDEN MEASURES TO SUPPORT THE CUBAN PRIVATE SECTOR AND EXPAND INTERNET ACCESS IN CUBA
May 29, 2024
Amid the island’s worst economic crisis in thirty years, independent Cuban entrepreneurs have been filling the void left by state enterprises increasingly unable to provide basic goods and services to their citizens. Against many odds, they are establishing distribution, production, and supply chains that put food on Cuban tables. The measures announced yesterday which include authorizing independent Cuban entrepreneeurs to open accounts in U.S. banks and better access cloud-based internet services will propel greater integration with U.S. markets for soourcing resources, supplies and new customers. By reducing transaction costs and increasing competition, they will also hopefully help the Cuban private sector make a greater array of goods available to the Cuban population at lower prices.
At the same time, we wish these measures had come sooner. In the two years since the Biden-Harris administration announced its intention to support the Cuban private sector, Cuba’s economic crisis has worsened significantly. Out-migration, mostly toward the United States, has been record-shattering. To be clear, slow and insufficient domestic reforms by Cuban authorities to generate investment and productive economic activity are primary drivers of the decline. But U.S. inaction and codified sanctions have only compounded suffering on the ground. In the many months this package was held up to facilitate congressional dealmaking on other White House priorities, the United States missed an opportunity to provide concrete support to the Cuban people at their greatest time of need in recent memory, and to those entrepreneurial change-makers that represent one of the few bright spots in Cuba today.
Thus, the Biden-Harris administration’s actions should not stop here. We call on the President to follow up yesterday’s measures with broad authorizations for direct correspondent banking and U.S. investment in Cuba’s private sector. Both are key forms of support that Cuban entrepreneurs have demanded and need to thrive. As U.S. geopolitical rivals seek to shape their own vision of economic reforms in Cuba, such efforts could not come at a more opportune moment.
Just as importantly, we call on the Cuban government to urgently modify its own laws and regulations to formally allow private small- and medium-sized enterprises to accept foreign direct investment and financing. A stronger, more consistent commitment to economic and political liberalization is necessary if the Cuban economy is to ever find a sustainable path to recovery.
The Cuba Study Group is a non-profit, non-partisan
organization, comprised of business and professional leaders with a deeply
rooted love for Cuba and the Cuban people. We aim to put our collective
experience in leadership skills, problem solving, and wealth creation at the
service of the Cuban people. We aim to facilitate change, help empower
individuals and promote civil society development.
May 30, 2024 -- The new OFAC regulations are important positive steps to undo Trumpism, especially permission given to Cubans and their private businesses to open bank accounts in the US and to manage them on line.
There are several other overdue steps to undo Trump that are necessary to rebuild the Biden Administration's international and regional credibility.
1) Remove Cuba's irrational designation as a State Sponsor of Terrorism (SSOT). In addition to crippling access to international finance, SSOT means travelers to Cuba lose the ESTE visa waiver for US entry for ten years.
2) Remove restrictions on purposeful travel, including the ban on hotel use and cruises from the US as well as general licenses for cultural performances and independent visits.
3) Suspend, as had always been the case, use of Title 3 of the Helms Burton law to end nuisance suits by Cuban Americans.
4) Permit purchase of rum and cigars as souvenirs.
5) End propaganda attacks on Cuba's international medical teams, its version of the Peace Corps. USAID head Samantha Power said it best when she was Obama's ambassador to the UN https://cubapeopletopeople.blogspot.com/2021/05/ambassador-samantha-powers-address-to.html
Ironically those steps would do more than anything else to open the door to economic and political change and a positive role with potential return for recent emigres. Viet Nam and Cuba have similar one party systems but twenty nine years after normalizing relations with the former we enjoy a comprehensive strategic partnership. Why can't we work toward the same mutual respect with Cuba?
We need to pay more attention to the positive history of Cuba and the US, including the link between Irish and Cuban nationalism in 19th century NY tinyurl.com/VarelaUS
https://oncubanews.com/en/cuba-usa/expectations-hopes-and-uncertainty-reactions-to-u-s-announcements-for-entrepreneurs/
732. What types of remittances are allowed to be made by persons subject to U.S. jurisdiction to persons in Cuba? What are the applicable conditions and requirements?
OFAC currently authorizes a number of categories of remittances from persons subject to U.S. jurisdiction to persons in Cuba pursuant to 31 CFR § 515.570. Section 515.570 excludes from the scope of the authorization any transaction relating to the collection, forwarding, or receipt of remittances involving any entity or subentity identified on the State Department’s Cuba Restricted List. Authorized remittance categories include:
Family remittances: Persons subject to the jurisdiction of the United States who are 18 years of age or older are authorized to make remittances to nationals of Cuba who are close relatives, as defined in § 515.339, of the remitter, provided that the recipient is not a prohibited official of the Government of Cuba, a prohibited member of the Cuban Communist Party, or a close relative of a prohibited official of the Government of Cuba or prohibited member of the Cuban Communist Party, and provided that the remittances are not made for emigration purposes. See §§ 515.337, 515.338, and 515.339 for relevant definitions.
Donative remittances: Effective June 9, 2022, OFAC amended § 515.570(b) to authorize donative remittances to Cuban nationals who are not prohibited officials of the Government of Cuba, prohibited members of the Cuban Communist Party, or close relatives of a prohibited official of the Government of Cuba or prohibited member of the Cuban Communist Party.
Remittances to certain individuals and independent non-governmental organizations in Cuba: Persons subject to the jurisdiction of the United States are authorized to make remittances to certain individuals and independent non-governmental organizations in Cuba, including remittances that encourage the development of private businesses and operation of economic activity in the non-state sector by independent private sector entrepreneurs. Please see FAQ 1179 for more information on the definition of an independent private sector entrepreneur. This general license also authorizes persons subject to U.S. jurisdiction to make remittances to pro-democracy groups and civil society groups in Cuba, and to members of such groups or organizations, to support: humanitarian projects in or related to Cuba that are designed to directly benefit the Cuban people and to support the Cuban people through activities of recognized human rights organizations, independent organizations designed to promote a rapid, peaceful transition to democracy, and activities of individuals and non-governmental organizations that promote independent activity intended to strengthen civil society. See § 515.570(g) for additional applicable conditions.
Remittances to religious organizations in Cuba: Persons subject to the jurisdiction of the United States are authorized to make remittances to religious organizations in Cuba in support of religious activities, provided that the remittances are not made from a blocked source and that the remitter, if an individual, is 18 years of age or older. See § 515.570(c).
Remittances to students in Cuba pursuant to an educational license: Persons subject to the jurisdiction of the United States who are 18 years of age or older are authorized to make remittances to close relatives, as defined in § 515.339, who are students in Cuba pursuant to the general license authorizing certain educational activities in § 515.565(a) or a specific license issued pursuant to § 515.565(f), provided that the remittances are not made from a blocked source and are for the purpose of funding transactions authorized by the general licenses in § 515.565(a) or the specific license issued pursuant to § 515.565(f) under which the student is traveling. See § 515.570(d).
Two one-time $1,000 emigration-related remittances: Persons subject to the jurisdiction of the United States are authorized to remit the following amounts, subject to certain conditions: (1) Up to $1,000 per payee on a one-time basis to Cuban nationals for the purpose of covering the payees' preliminary expenses associated with emigrating from Cuba to the United States; and (2) up to an additional $1,000 per payee on a one-time basis to Cuban nationals for the purpose of enabling the payees to emigrate from Cuba to the United States, including for the purchase of airline tickets and payment of exit or third-country visa fees or other travel-related fees. See § 515.570(e).
Unblocking and return of blocked remittances: Effective June 9, 2022, OFAC added a general license in § 515.570(h) authorizing the unblocking and return of blocked remittances, provided they would be authorized under revised § 515.570(a) or (b).
See § 515.570 for a complete description of what the OFAC general licenses related to remittances authorize and the restrictions that apply, as well as statements of specific licensing policy.
For remittances from Cuban nationals to persons subject to U.S. jurisdiction, see § 515.587.
Updated: May 28, 2024
748. May U.S. banks open and operate accounts for Cuban nationals present in Cuba?
Yes. Section 515.584(h)(1) of the CACR contains a general license that allows banking institutions to open and maintain bank accounts in the United States solely in the name of a Cuban national located in Cuba, to receive payments in the United States for transactions authorized pursuant to, or exempt from the prohibitions of, the CACR and to remit such payments back to Cuba, including through an online payment platform. For example, an author who is a Cuban national located in Cuba may open an account with a bank in the United States to receive payments for sales of their book. Additionally, pursuant to 31 CFR § 515.584(h)(2), a U.S. banking institution may open and maintain an account solely in the name of a Cuban national who is an independent private sector entrepreneur (as defined in 31 CFR § 515.340) for the purpose of conducting authorized or exempt transactions (e.g., receipt of payment for the importation to the United States of certain goods and services produced by independent Cuban entrepreneurs pursuant to 31 CFR § 515.582 or payment related to authorized exports to Cuba under 31 CFR § 515.533), including through an online payment platform. Pursuant to this authorization, independent private sector entrepreneurs — whether located in the United States, Cuba, or another country — can open and remotely access their account at a U.S. banking institution and conduct remote transfers, including to Cuba, as long as the underlying transaction is authorized or exempt. For a complete description of what this general license authorizes and the restrictions that apply, see 31 CFR § 515.584(h)(2).
Updated: May 28, 2024
770. What types of goods and services produced by independent private sector entrepreneurs are authorized for importation into the United States from Cuba pursuant to 31 CFR § 515.582?
Pursuant to 31 CFR § 515.582, certain goods and services produced by independent private sector entrepreneurs, as defined in 31 CFR § 515.340, and as set forth in a list maintained by the State Department on its website, are authorized for importation. Persons subject to U.S. jurisdiction may engage in associated transactions necessary to import these authorized goods and services. The State Department Section 515.582 list provides details of the goods and services authorized for importation into the United States from Cuba pursuant to this provision. This list references sections and chapters of the Harmonized Tariff Schedule (HTS) of the United States to indicate categories of goods that are not eligible for importation into the United States pursuant to 31 CFR § 515.582, even if such goods were produced by independent private sector entrepreneurs; any other goods produced by independent private sector entrepreneurs and not covered by the listed sections and chapters of the HTS may be imported, as provided in the State Department’s Section 515.582 list and subject to compliance with all other relevant requirements under state and federal law and regulations. Imports authorized by 31 CFR § 515.582 are not subject to the limitations set forth in 31 CFR § 515.560(c) or 31 CFR § 515.544, including the $100 limitation on imported merchandise from Cuba or Cuban-origin merchandise from a third country intended as gifts. For additional information, please see FAQ 1178.
Updated: May 28, 2024
Section 515.582 of the CACR authorizes persons subject to U.S. jurisdiction to import certain goods and services produced by independent private sector entrepreneurs, as determined by the State Department and set forth on the State Department's Section 515.582 List. See FAQ 770.
In determining whether a good is produced by an independent private sector entrepreneur, as defined in 31 CFR § 515.340, persons subject to U.S. jurisdiction should consider the extent of Cuban state-owned entities’ involvement in the production and exportation of such goods. For example, goods generally are not considered produced by independent private sector entrepreneurs if the manufacturing or processing conducted by Cuban state-owned entities results in a product with a new name, character, or use. For example, an agricultural commodity grown by an independent grower but then processed by Cuban state-owned entities into a new product prior to exportation would not be a good produced by an independent private sector entrepreneur for purposes of 31 CFR § 515.582. However, a good can still be considered produced by an independent private sector entrepreneur if, for example, Cuban state-owned entities are involved only in packing of the final product or acting solely as an export agent.
Released on
Section 515.582 of the CACR authorizes persons subject to U.S. jurisdiction to import certain goods and services produced by independent private sector entrepreneurs, as determined by the State Department and set forth on the State Department's Section 515.582 List. See FAQ 770.
In determining whether a good is produced by an independent private sector entrepreneur, as defined in 31 CFR § 515.340, persons subject to U.S. jurisdiction should consider the extent of Cuban state-owned entities’ involvement in the production and exportation of such goods. For example, goods generally are not considered produced by independent private sector entrepreneurs if the manufacturing or processing conducted by Cuban state-owned entities results in a product with a new name, character, or use. For example, an agricultural commodity grown by an independent grower but then processed by Cuban state-owned entities into a new product prior to exportation would not be a good produced by an independent private sector entrepreneur for purposes of 31 CFR § 515.582. However, a good can still be considered produced by an independent private sector entrepreneur if, for example, Cuban state-owned entities are involved only in packing of the final product or acting solely as an export agent.
Section 515.340 defines the term “independent private sector entrepreneur” to mean a Cuban national who is not a prohibited official of the Government of Cuba or a prohibited member of the Cuban Communist Party, and who is one or more of the following: (a) an owner, including a self-employed individual (cuentapropista), or employee of a small private business entity, private cooperative, or a sole proprietorship located in Cuba, in each case of up to 100 employees; (b) an independent contractor or consultant; (c) a small farmer who owns his or her own land; (d) a small usufruct farmer who cultivates state-owned land to sell products on the open market; or (e) a private cooperative or small private business entity located in Cuba of up to 100 employees that is owned only by individuals described in paragraphs (a) through (d) of § 515.340. For example, small private business entities or private cooperatives owned only by independent private sector entrepreneurs, as defined, could include:
- Agricultural businesses and farming cooperatives;
- Animal feed and veterinary services;
- IT services, software development businesses, and mobile application developers
- Food and beverage importers, production/processing businesses, packaging and food distributors;
- Clothing, jewelry, fashion design, and beauty/cosmetics suppliers and services;
- Historic preservation and cultural preservation businesses;
- Arts-related businesses;
- Machinery manufacturing and repair businesses;
- Shipping, logistics, expediting, and delivery of goods businesses;
- Medical supply businesses;
- Restaurants and bars;
- Taxis and transportation services;
- Bed and breakfasts;
- Manufacturing companies;
- Business consulting services, marketing and branding services;
- Accounting and bookkeeping services;
- Home construction business and remodeling, plumbing, electrical, or other repair companies for business or residential facilities and homes;
- Furniture design and manufacturing companies;
- Travel services;
- Vendors of personal care and household items, furniture, and appliances;
- Interior decoration and design businesses;
- Film and media production or journalism businesses;
- Gyms, personal training, or fitness classes; and
- Mechanical services (automobile, refrigeration, heating and A/C services and repair).
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