Overview
On October 17, the Treasury Department’s Office of Foreign Assets Control (OFAC) and the Commerce Department’s Bureau of Industry and Security (BIS) published amendments to the Cuban Assets Control Regulations (CACR) and the Export Administration Regulations (EAR). These amendments took further steps to ease economic sanctions and export control restrictions on Cuba. Along with these regulatory actions, OFAC published a fact sheet and amended its Cuba frequently asked questions (FAQs) and travel guidance. Additionally, President Obama issued a new Presidential Policy Directive, broadly outlining how the normalization of relations with Cuba may proceed.
With these amendments to the CACR, OFAC has taken the significant step of allowing US persons to enter into executory contracts for activity that is currently prohibited by the CACR, given that the contracts are made expressly contingent on obtaining OFAC authorization or on the end of the authorization requirement. This change is noteworthy because it allows companies and persons subject to the current CACR restrictions to pursue potential business opportunities and conditionally secure trade and investment transactions in anticipation of continued liberalization of the embargo. This may itself provide momentum for liberalization, as US business interests may more clearly see the benefits normal economic relations could bring. Furthermore, these regulatory amendments authorize greater activity related to trade between third countries and Cuba, medical research and pharmaceuticals, the safety of civil aviation, infrastructure development, direct sales to Cuba of consumer goods for personal use, transit of air cargo, travel, as well as other areas. For more information, please see our advisory.
