One European company promises American and non-American travelers to Cuba the “ability to indulge in high end hotel and spa accommodations.” Last week, a fifth or sixth company was granted a U.S. Treasury Department license to provide ferry service to Cuba. Meanwhile, Caterpillar’s Washington, DC Director, Mr. Bill Lane, told the Cuba Standard newsletter that U.S. companies should go to Cuba to “start scoping the place out.”
I did not know that “scoping” was one of the twelve travel exceptions to US-Cuba sanctions … It is not, and I’m certain that it is not what Mr. Lane meant to convey; however, these statements muddle the matter. Traveling to Cuba for solely business development purposes is not allowed for most industries seeking entry to the Cuba market; a specific license is required. And unless you happen to fall into some very specific industries, save your time and money, because your application will be return without action, rejected.
I can already hear the howls from my lawyer colleagues on K Street and Miami, Florida that disagree with me on this point. So be it. Just because OFAC has not caught people doing so, does not make it legal. Be careful taking advice from lawyers, and self-appointed Cuba experts, who say that there are scores of Americans buying land in Cuba, sailing their yachts, and otherwise making deals in Cuba. That may be true, and I hear many such stories when visiting Miami; however, avoid the trap.
The President and federal government officials continue to create a climate of political and regulatory uncertainty that, most certainly, will lead to increased litigation in U.S. courts, human rights abuses in Cuba, as well as work against the explicit goal of U.S. policy: a peaceful transition. The President’s new Cuba policy, and the Congress’s acquiescence is setting the stage for more a very tumultuous transition process.
Rather than follow the roadmap created by the Cuban Democracy Act and its progeny, policymakers skirt or simply ignore the law. As they have done on immigration, the administration is using executive action to force as much economic activity with Cuba as the political environment will allow. And with Congress basically doing nothing to stop them, the Cuban regime is celebrating, consolidating, and cashing in as much as they can this year.
When will the Obama Administration, as they’ve done in places such as Burma, encourage (it should be voluntary, not government mandated) U.S. companies allowed to trade with Cuba to adopt a corporate code of conduct? The leading special interest group pushing for closer relations with Cuba, the U.S. Chamber of Commerce, touts corporate social responsibility principles in places such as China, yet why not Cuba?
Follow this link for a preliminary list of items that should be included in any compliance program for Cuba transactions undertaken by persons subject to U.S. law.