Various news reports from the Caribbean indicate a rift between organizers of the Caribbean Series (Serie del Caribe) and Major League Baseball (MBL) over the potential inclusion of a Cuban team during the upcoming winter baseball Caribbean Series in 2014 because of the U.S. embargo over Cuba.
It was only in June of this year when it was reported that Cuba would field a team to compete in the Caribbean Series for the first time in 53 years. Then, earlier this month, a newspaper in the Dominican Republic, Diario Libre, got hold of a letter from MLB's V.P. for Operations to Juan Puello, one of the officials organizing the Caribbean Series, purportedly asking Mr. Puello to drop Cuba from the Series. The reason: that the U.S. embargo of Cuba bars MLB players, many of whom play in the Series during the off-season, from participating in a league that includes a Cuban team unless MLB obtains certain authorizations from the U.S. government. According to the story in Diario Libre, the letter to Mr. Puello (the existence of which was assertedly confirmed by the Associated Press) explains that MLB did not have sufficient time to secure the necessary authorizations from the U.S. in time for the beginning of the series in February of 2014.
In a recent telephone interview with the Associated Press, Mr. Puello stated that the Confederation of Baseball in the Caribbean, which oversees the Caribbean Baseball Series, is working with the U.S. government to obtain the necessary authorizations to allow Cuba to play in the series. The Diario Libre article, quoting an excerpt from the MLB letter, reported that MLB management "was surprised and extremely disappointed when [they] learned that the Confederation had decided, without consulting MLB, to introduce a new Cuban team to its membership."
The Diario Libre article did not identify the particular legal obstacle under U.S. embargo. The U.S. Cuban Asset Control Regulations (CACRs) allow persons who are subject to U.S. jurisdiction to engage in certain, specific licensed transactions involving Cuba, including travel to the island itself. The CACRs also provide for certain limited authorizations pertaining to sports and athletic events involving Cubans, including events that take place in Cuba. However, the issue for MLB cannot be that the Series is taking place in Cuba (the 2014 Series is taking place on Margarita Island in Venezuela). Rather, the issue may be that the teams play for prize money and/or must pay certain entry fees to become part of the league that manages the Series and that such pecuniary transactions, should a Cuban team enter the Series, will trigger the CACRs' prohibitions against engaging in unauthorized financial transactions. It is also possible that monies from televising the Series make their way to the teams, and by extension, players subject to U.S. jurisdiction under the embargo.
If indeed the problem is linked to the way the organizers manage the funding that supports the Series, and, if by including a Cuban team, funds from Cuba or U.S. sponsors are intermingled with funds from teams that include MLB players, then I can see how MLB felt a bit blind-sided by the organizers' decision to include Cuba without first consulting with MLB. Although the CACRs do not include an express general or specific license provision that would apply in this situation (Section § 515.567 of the CACRs comes the closest), the most recent revisions to the CACRs were done with the aim of promoting more contact between the people of the United States and Cuba. What better way to do that than to have MLB players from the United States participate in the winter Caribbean classic along with Cuban baseball players?
This article is for general information and does not include full legal analysis of the matters presented. It should not be construed or relied upon as legal advice or legal opinion on any specific facts or circumstances. The description of the results of any specific case or transaction contained herein does not mean or suggest that similar results can or could be obtained in any other matter. Each legal matter should be considered to be unique and subject to varying results. The invitation to contact the authors or attorneys in our firm is not a solicitation to provide professional services and should not be construed as a statement as to any availability to perform legal services in any jurisdiction in which such attorney is not permitted to practice.
Duane Morris LLP, a full-service law firm with more than 700 attorneys in 24 offices in the United States and internationally, offers innovative solutions to the legal and business challenges presented by today's evolving global markets. Duane Morris LLP, a full-service law firm with more than 700 attorneys in 24 offices in the United States and internationally, offers innovative solutions to the legal and business challenges presented by today's evolving global markets. The Duane Morris Institute provides training workshops for HR professionals, in-house counsel, benefits administrators and senior managers.