Published by The New York Times on December 16, 2015. Written by Julie Hirschfeld Davis.

WASHINGTON — As the anniversary neared of President Obama’s announcement of a historic détente with Cuba, Representative Ileana Ros-Lehtinen of Florida, who was born in Havana and fled with her family to Miami decades ago, gave him a reality check. The policy change had done little to improve life for the Cuban people, she told the president at the White House last week, and had actually made their human rights situation worse.

Give it time to work, Ms. Ros-Lehtinen said the president responded, the strategy has been in place for only a year.

When he announced last December that he was shattering a half-century of hostility between the United States and Cuba in favor of a new chapter in the relationship between the two countries, Mr. Obama conceded that, “Change is hard.” In the 12 months since then, that prediction has been borne out. The normalization process has proceeded in fits and starts, yielding a handful of concrete accomplishments — most notably, the reopening of embassies in Washington and Havana shuttered since the Cold War — and lingering difficulties.

For all the aspirations of a new era in United States-Cuba relations, the reality has been a much more gradual process, still thwarted in many ways by the American embargo and major differences over politics, human rights and property claims.

Tens of thousands of Cubans have fled the country since the Dec. 17, 2014, announcement of the rapprochement, fearing that the Cuban Adjustment Act, the American law allowing them to obtain residency upon their arrival, will soon be changed. Many Cubans were left sorely disappointed, with little evidence of change on the streets, and even less in the daily lives of those earning paltry salaries and still struggling to find eggs and other staples.

“We went into this with no illusions that the Cubans were going to radically change their political system overnight, but our belief has been that greater engagement, greater people-to-people ties, greater commercial activity does open up space for the Cuban people,” said Benjamin J. Rhodes, Mr. Obama’s deputy national security adviser for strategic communications, who participated in the secret talks that led to the rapprochement. “Part of what we are doing is raising people’s expectations, and that’s appropriate.”

To critics like Ms. Ros-Lehtinen, the president has fallen far short. They argue that the United States has made valuable concessions to President Raùl Castro over the past year — including removing Cuba from the list of state sponsors of terror, restoring diplomatic ties, and loosening sanctions on travel and business with the island nation — without getting much in return.

“Despite some low-level agreements the administration trumpets, truly little has ‘progressed’ as it relates to Cuba or everyday Cubans,” Ms. Ros-Lehtinen said through a spokesman. “Repression has risen and has led to more Cubans trying to flee the country under Communist rule, while at the same time little progress has been made on human rights, U.S.-confiscated properties, return of wanted U.S. fugitives and democratic freedoms.”

But the president sees glimmers of hope in the painstaking work of prying open a half-century’s worth of institutional barricades between the American and Cuban governments, and he has explicitly refused to condition the thaw in relations to specific demands on Mr. Castro’s government. He told Yahoo! News last week that he wanted to visit the island nation during his final year in office and meet with pro-democracy dissidents there, in part to “nudge the Cuban government in a new direction.”

“We reject this notion that our opening is a form of concession, because the opening is the whole point — we think it’s in our interest to have people traveling down to Cuba and doing business there,” Mr. Rhodes said in an interview. “There’s a natural momentum to these things.”

The process has already yielded some concrete results, with the number of Americans authorized to travel to Cuba up 50 percent over the last year, a growing private sector in Cuba and two United States telecommunications companies sealing roaming agreements there.

In April, Mr. Obama and Mr. Castro shook hands and met face to face at the Summit of the Americas in Panama, becoming the first American and Cuban presidents to do so in more than 50 years. They had their first meeting on American soil in September at the United Nations. In between, after marathon negotiations by both governments, the United States and Cuba re-established formal diplomatic relations in July, opening embassies that had long been closed.

The Treasury and Commerce Departments have acted twice to ease sanctions and allow Americans and Cubans to forge closer personal and business ties, and on Wednesday reached an agreement on commercial flights.

An environmental cooperation deal was signed last month, and a pilot program to explore restoring direct mail service between the United States and Cuba will soon begin.

Diplomats have started high-level talks on human rights issues and resolving billions of dollars in claims against Cuba by American citizens and businesses for property seized in the revolution, as well as Cuban counterclaims for more than $150 billion in damages Havana claims to have suffered from the embargo.

“It was just pure fantasy to think, as it has been for the last 60 years, that the United States could directly shape the nature of the Cuban political system,” said Julia E. Sweig, a Cuba specialist and senior research fellow at the Lyndon Baines Johnson School of Public Affairs at the University of Texas at Austin. “It feels like we’re getting excited about tiny steps, but those tiny steps, against the backdrop of the thicket of laws and regulations that have produced a ‘no’ as the answer to any question, and now we’re figuring out how to get to ‘yes’ — that’s progress.”

Still, many obstacles remain, including an overarching concern among the Cuban government and American companies seeking to do business there that their assets will be seized because of outstanding sanctions and provisions of the embargo.

The Cuban government has resisted many of the economic reforms and other steps that will facilitate such deals, American officials acknowledge, partly out of fear that swift change will wash away the gains of the revolution in a sea of capitalist investment. There is also a worry in Cuba that opening its market to the United States might weaken the pressure on Washington to lift the embargo once and for all.

“When you stand back and look at this against the backdrop of almost 60 years of complete adversity, complete lack of dialogue, absolute distrust, it’s been a remarkable year,” said Scott D. Gilbert, a Washington-based lawyer who helped negotiate the release of Alan P. Gross, an American imprisoned in Havana, as part of last year’s agreement. “But there is frustration and disappointment on both sides that more deals haven’t gotten done. It’s a process that still needs a lot of work.”

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I. INTRODUCTION

Facilitating increased telecommunications services between the U.S. and Cuba has been a cornerstone of President Obama’s new policy toward Cuba.  Soon after the President’s December 17, 2014 announcement regarding this new policy, the U.S. Departments of Treasury and Commerce amended their regulations to broaden opportunities for U.S. companies to provide telecom services and infrastructure to Cuba.  Slow action by the U.S. State Department and the Federal Communications Commission (“FCC”) to amend their Cuba telecom policies, however, has continued to pose obstacles to U.S. telecom providers seeking to do business in Cuba.

In recent weeks, the State Department and FCC have taken long-awaited steps to eliminate these remaining barriers.  These actions will bring FCC regulations more in line with President Obama’s Cuban telecom initiatives and facilitate new opportunities for U.S. telecom companies to do business in Cuba.

II. PREVIOUS FCC REGULATIONS

The FCC implements policies and procedures for Cuba-related telecom service based on policy guidance from the State Department.  Until recently, FCC regulations relied upon guidance from State that had not been updated since January 2010.  These outdated directives placed a number of restrictions on U.S. telecom carriers doing business with Cuba that were inconsistent with the Commerce and Treasury Departments’ recent sweeping regulatory changes regarding the provision of telecom service to Cuba.

  1. Inclusion on Section 214 Exclusion List

Under previous FCC regulations, Cuba was the only country on the “Exclusion List” for international Section 214 applications.  FCC regulations require all facilities-based carriers to obtain Section 214 authorization to provide international call service from the U.S. to foreign countries.  While the authorization process for most countries typically is efficient and streamlined, providing call service to countries on the Exclusion List requires a separate authorization that is notoriously difficult to obtain.  Carriers must go through a burdensome application process that includes State Department review.[1]

  1. Non-discrimination Protections

Previous FCC regulations also required that agreements between U.S. and Cuban carriers comply with certain “non-discrimination” protections, which dictate that all U.S. carriers must receive the same effective accounting rate for providing similar call services between the U.S. and Cuba.  These protections were intended to prevent Cuba’s state-owned telecom company from discriminating among U.S. carriers competing to carry international traffic to the country.  U.S. carriers have argued, however, that such protections prevent them from negotiating lower rates and responding to market forces.  Cuba was the only country to which these non-discrimination protections still applied.[2]

  1. Establishment of Settlement Benchmarks

As an additional competitive safeguard, the FCC has established benchmarks governing the international settlement rates that U.S. carriers may pay foreign carriers to terminate international traffic from the U.S.  Under FCC regulations, U.S. carriers must negotiate settlement rates with Cuban carriers that are at or below the benchmark level of 19 cents per minute, or they must obtain a benchmark waiver from the FCC.[3]  In other words, U.S. providers can only offer direct calls to Cuba and roaming service if they pay the Cuban Government a fee no higher than 19 cents per minute.  These benchmark rates have delayed or derailed U.S.-Cuba telecom transactions in the past, as the Cuban Government historically has required a termination rate higher than 19 cents per minute.[4]

III. NEW FCC ACTION

On October 26, 2015, the State Department issued new policy directives to the FCC regarding telecom service to Cuba.  The FCC published a notice announcing its proposed implementation of those new directives on November 9, 2015.  According to the notice, the FCC will:

  1. Begin the process of removing Cuba from the 214 Exclusion List and immediately cease coordinating with the State Department in evaluating Section 214 applications for service to Cuba.

Implications of Change:  Removing Cuba from the 214 Exclusion List means that communications companies that already have global Section 214 authorizations can provide facilities-based services from the U.S. to Cuba without seeking additional authority or engaging in a burdensome application process.

The FCC has sought expedited comment on its proposal to remove Cuba from the 214 Exclusion List.  Comments are due on December 4, 2015, and reply comments are due on December 9, 2015.  According to some industry experts, the expedited timeframe suggests that the FCC may already be in the process of implementing its proposal.

  1. Begin the process of removing non-discrimination requirements currently applicable to the U.S.-Cuba call transfer route.

Implications of Change:  The FCC will no longer require that all U.S. carriers receive the same accounting rates from the Cuban Government, meaning that U.S. carriers will have more flexibility to negotiate rates and to respond to market forces.

  1. Continue to apply the appropriate benchmark settlement rate for telecom services between the U.S. and Cuba, while still allowing waivers as appropriate.

Implications of Change:  The FCC will continue to maintain the same benchmark settlement rate of 19 cents per minute for calls to Cuba, though the FCC will also continue to allow waivers of limited duration on a case-by-case basis.  The FCC’s failure to modify or eliminate these benchmarks may continue to hinder transactions with Cuba if the Cuban Government continues to require higher call termination fees.  The FCC has shown willingness in the past, however, to grant waivers for transactions in Cuba as necessary.

IV. CONCLUSION

The FCC’s new proposed actions bring FCC policy in line with current Treasury and Commerce regulations and President Obama’s policy on Cuba.  While the continued application of benchmark settlement rates may hinder certain transactions, the FCC’s removal of Cuba from the 214 Exclusion List and elimination of non-discrimination safeguards should make it easier for U.S. carriers to compete in the Cuban telecom market.

[1] See 47 C.F.R. § 63.12.

[2] See International Settlements Policy Reform, IB Dkt. Nos. 11-80, 05-254, 09-10, RM-11322, Report and Order ¶¶ 16–20, FCC 12-145, 27 FCC Rcd 15521 (2012) (“2012 ISP Reform Order”).

[3] See 2012 ISP Reform Order ¶ 17.

[4] Jens Erik Gould, Free Cuba Phone Market Urged on Obama by Nokia, AT&T, Bloomberg Business (Aug. 21, 2010). http://www.bloomberg.com/news/articles/2010-08-31/free-cuba-telecommunications-market-urged-on-obama-by-at-t-nokia-verizon.

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Published by USA Today on November 2, 2015. Written by Alan Gomez.

Part of the promise of this week’s trade show is to teach American business owners how to work with Cuba, starting with something as simple as getting there.

Alex Procopio, a San Diego-based businessman who has sold food products to Cuba for more than a decade, said he had lined up eight U.S. companies to travel with him to the trade fair. After they struggled to book flights through a complicated charter process and reserve hotel rooms in a country that doesn’t accept U.S.-issued credit cards, he said seven companies dropped out.

“Cuba is still the forbidden fruit, it’s still that hard-to-get-to island,” Procopio said. “That’s part of its charm.”

Scott Gilbert said the fair is also an opportunity for U.S. companies to meet Cuban government officials.

Gilbert is the attorney who helped broker the release of contractor Alan Gross, who was freed after five years in a Cuban prison as part of last year’s deal to begin normalizing relations with Cuba. Gilbert is now advising companies about dealing with the Cubans.

“Americans who are used to coming into a country and moving things very quickly, they are being fairly assertive and aggressive and finding that doesn’t work well,” he said. “You’ve got to understand their situation, understand the dynamic and try to work within it to do the best that you can.”

Part of that learning process is finding out what the Cubans want.

Read the entire article here.”

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Published by Mother Jones in October 2015. Written by Peter Kornbluh and William M. Leogrande.

When Gross’ terminally ill, 92-year-old mother, Evelyn, took a severe turn for the worse in late May, negotiations became urgent. Meeting in Ottawa in early June, the Cubans pushed for a quick prisoner trade, expressing their fear that Gross would kill himself when his mother passed away. US officials, meanwhile, worried that if Gross died in a Cuban prison, a change in US policy would become politically impossible.

Kerry reached out to Cuban foreign minister Bruno Rodríguez and proposed a “furlough” to the United States—Gross would wear an electronic bracelet to allow the Cubans to monitor his movements, and he would return to prison after his mother’s death. “Alan promised unequivocally that he would return to incarceration in Cuba after visiting his mother at the hospital in Texas,” his lawyer Scott Gilbert recalls, “and I offered to take his place until he returned. That is how important this was.”

But the Cubans considered the plan too risky. After Evelyn Gross died on June 18, 2014, Kerry warned Rodrí­guez that if any harm came to Gross while in Cuba’s custody, the opportunity for better relations would be lost.

Read the entire article here

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Cuba needs capital investment to fuel emerging industries and to help build competitive infrastructures. The embargo’s continuing restrictions on partnerships with Cuban entities in many sectors impede such investment and frustrate U.S. policy goals rather than advance them.

Will the Obama Administration’s new rules open the floodgates to Cuba for American business next month or even next year? No. Full and fair free trade with Cuba won’t happen until Congress finally repeals Helms-Burton, the myopic and failed U.S. trade embargo.

To be sure, the new regulatory amendments put forth this month are an important and necessary step in the right direction. Building on the Administration’s historic first round of amendments relaxing embargo restrictions in January, the September changes create the most significant opening in decades for Americans seeking to do business in Cuba.

American business executives contemplating opportunities in the Cuban marketplace would do well to study the regulations in the wake of these revisions. They should understand the full potential breadth of the regulatory windows that have been created, as well as identify for themselves and U.S. policymakers and regulators those issues ripe for further regulatory change.

Read the full article on FoxNews.com

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Published by The New York Times on August 13, 2015. Written by Julie Hirschfeld Davis and Peter Baker.

Mr. Gross’s lawyer, Scott D. Gilbert, told the White House that if his client died, Mr. Obama would shoulder the blame. “We’re now at the point where we’re bringing my client out on the plank,” Mr. Gilbert told Mr. Zuniga during a tense meeting at the White House. “If you don’t deliver on this, Alan is going to die, and this whole thing will blow up in your face.”

Mr. Gilbert threatened to sue Mr. Obama on the eve of the 2014 midterm elections for failing to uphold the Hostage Act of 1868, which requires the president to take all action short of war to free an American captive held unjustly by a foreign government.

Mr. Kerry sent a handwritten note of encouragement to Mr. Gross, followed by the president’s letter. Mr. Gilbert delivered them in separate trips to the military hospital in Havana where he was held. He also brought cryptic updates for Mr. Gross on efforts to win his release, typed into the body of routine legal memos to avoid detection.

Restoring Relations

By then, the talks had moved beyond Mr. Gross into details about restoring diplomatic relations and reopening embassies. In September, Mr. Rhodes and Mr. Zuniga arrived at the Vatican to present the entire package to senior advisers to the pope’s advisers.

“At that point, you’re on the hook to the pope,” Mr. Rhodes recalled. “When we walked out of the Vatican, we knew this was over. That was the moment when I kind of exhaled.”

Read the entire article here.

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Ironically, while the long-overdue thaw in U.S.-Cuba relations has encouraged and even accelerated foreign investment in Cuba, the vast majority of U.S. businesses, still shackled by the embargo on Cuba, cannot compete in that marketplace.  This is not about leveling the playing field for American companies; it is about just letting them onto the field.

The embargo is a vestige of an archaic foreign policy. Arguably, it was a failed policy from the get-go, accomplishing nothing except to deepen the suffering of average Cubans who themselves had little or no participation in the political activities that rankled the U.S. for six decades.

Read the entire article here.

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Published by Forbes on May 8, 2015. Written by Richard Levick.

I love this item.

On May 29, Corban University, an evangelical college in Salem, Oregon, will send its baseball team to Cuba on a religious mission and to play a little ball. “I think it’s awesome how…we can use a sport that both countries love to go and tell people about Jesus,” said a Corban player. “Even though we won’t be able to do that publicly because of the laws there, we will be able to speak in the underground churches…which is really cool.”

Nothing like announcing a covert operation in the newspapers one month in advance! Yet reportedly, it was Cuban officials who suggested the team could come on a religious visa, implying at least some overt complicity on their end. And that’s important for reasons that have much less to do with baseball or religion.

Read the entire article on Forbes.com

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