On January 26, 2016, the U.S. Department of Treasury’s Office of Foreign Assets Control (“OFAC”) and U.S. Department of Commerce’s Bureau of Industry and Security (“BIS”) announced new amended regulations intended to further promote U.S. policy toward engaging and empowering the Cuban people.  The new amendments increase export opportunities, facilitate authorized travel, and broaden the scope of authorized transactions related to professional meetings and other events, disaster preparedness and response projects, and professional media and artistic productions in Cuba.

A summary of the new OFAC and BIS amendments is below:

Removing financing restrictions for most types of authorized exports.

  • The amendments remove restrictions on payment and financing terms for authorized non-agricultural exports and permit U.S. banks to provide financing, including by issuing a letter of credit for such exports. Under previous regulations, payment and financing terms for all authorized exports were restricted to cash-in-advance or third-country financing.

Additional amendments to increase support for the Cuban people and facilitate authorized exports.

  • OFAC is expanding an existing general license to authorize certain travel-related transactions incident to the conduct of market research, commercial marketing, sales or contract negotiation, accompanied delivery, installation, leasing, or servicing in Cuba of items permissible for export under BIS regulations.
  • BIS now will generally approve license applications for export of the following:
    1. commodities and software to organizations that promote independent activity intended to strengthen civil society in Cuba;
    2. commodities and software to U.S. news bureaus in Cuba whose primary purpose is the gathering and dissemination of news to the general public;
    3. telecommunications items that would improve communications to, from, and among the Cuban people;
    4. certain agricultural items (such as agricultural commodities not eligible for a license exception, such as insecticides, pesticides, and herbicides); and
    5. items necessary to ensure the safety of civil aviation and the safe operation of commercial aircraft engaged in international air transportation.
  • BIS is also creating a case-by-case licensing policy that will apply to exports of items to meet the needs of the Cuban people, including exports to state-owned entities that provide goods and services to the Cuban people.  Exports eligible for this licensing policy would include, for example, items for agricultural production, education, and construction of infrastructure that directly benefits the Cuban people (e.g., facilities for treating public water supplies and supplying energy to the general public).

Additional amendment to facilitate carrier service by air and with Cuban airlines.

  • The amendments authorize entry into blocked space, code-sharing, and leasing arrangements to facilitate the provision of carrier services by air, including entry into such arrangements with a Cuban national.

Expanding authorizations within existing travel categories to facilitate travel to Cuba for additional purposes.

  • Airline and vessel crew personnel.  The amendments authorize certain personnel who are operating or servicing vessels or aircraft transporting authorized travelers between the U.S. and Cuba to engage in travel-related and other transactions in Cuba to facilitate that transport.
  • Information and informational materials.  The amendments authorize travel-related and other transactions incident to the exportation, importation, or transmission of information, including the filming or production of movies and television programs; music recordings; and the creation of artworks by certain persons in Cuba.  The amendments also expand an existing general license to authorize transactions relating to the creation and dissemination of informational materials, including employment of Cuban nationals and the remittance of royalties or other payments.
  • Professional meetings.  The amendments authorize by general license travel-related and other transactions to organize professional meetings or conferences in Cuba.  The previous general license authorized only attendance at such meetings or conferences.
  • Public performances, clinics, workshops, athletic, and other competitions and exhibitions.  Similar to the change to the professional meetings category, the amendments authorize transactions related to organizing, rather than just attending, these events.  The amendments remove requirements that U.S. profits from certain events be donated to certain organizations and that certain events be run at least in part by U.S. travelers.
  • Humanitarian projects.  The amendments expand the list of authorized humanitarian projects to include disaster preparedness and response.

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