U.S. Continues Incremental Easing of Cuban Sanctions

On January 27, 2016, the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) released revised Cuban Assets Control Regulations (“CACR”) to continue implementing policy changes announced by President Obama on December 17, 2014 and initiated on January 16, 2015. In a coordinated action, the U.S. Department of Commerce’s Bureau of Industry and Security (“BIS”) issued a rule updating U.S. export controls to facilitate permitted activities. These revisions follow prior amendments to the OFAC and BIS regulations regarding Cuba published on September 21, 2015. The revised regulations, effective January 27, 2016, continue to ease U.S. sanctions on Cuba. General travel and tourism in Cuba remain prohibited to persons acting within U.S. jurisdiction, as does most commercial and financial activity.

The regulations build upon previously announced authorizations for travel and trade with Cuba, reducing friction encountered by those trying to take advantage of prior policy changes by addressing some of the most frequently encountered issues. Most notably, the new rules:

• Expand the categories for which licenses to export goods or services to Cuban consumers can be obtained;
• Ease the restrictions on financing authorized exports;
• Authorize additional travel-related transactions, including:
  • Blocked space, code-sharing, and leasing arrangements with Cuban entities for civil air service to Cuba, including with Cuban entities;
  • Travel to Cuba in connection with authorized service by aircraft and vessel crew and support personnel;
  • Travel to Cuba to organize permitted travel by U.S. persons;
• Facilitate creation of media or artistic productions in Cuba; and
• Ease licensing policies with respect to: (i) exports to human rights organizations and U.S. news bureaus in Cuba; (ii) certain agricultural items; (iii) telecommunications items; and (iv) items necessary to ensure the safety of civil aviation.

The primary sanctions on Cuba remain in place and are expected to do so over the medium term, in large part because congressional action would be required for more sweeping and permanent changes.