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On November 9, 2017, the Office of Foreign Assets Control amended the Cuban Assets Control Regulations to implement changes to the Cuba sanctions program announced by President Trump in June of this year, which aimed to reinforce certain policies that had been relaxed by the Obama Administration. Most significantly, President Trump directed OFAC to impose new travel restrictions and curtail transactions with businesses controlled by the Cuban military, intelligence, and security sectors— a prohibition many companies feared would heavily impact the tourism industry.
According to OFAC, the changes are "intended to channel economic activities away from the Cuban military, intelligence, and security services, while maintaining opportunities for Americans to engage in authorized travel to Cuba and support the private, small business sector in Cuba." The new regulations impose new travel restrictions on Americans and prohibit direct financial dealings with more than 80 hotels and dozens of other companies considered to be tied to Cuba's military, intelligence, or security services. The new restrictions, which became effective November 9, include:
- Prohibited Financial Transactions—the new regulations prohibit US persons (or persons subject to US jurisdiction) from engaging in most direct financial transactions with entities identified by the State Department on the Cuba Restricted List, published simultaneously with the amended regulations. Notably, commercial engagements in place prior to the State Department's listing of any entity will continue to be authorized, as will most previously arranged travel. Additionally, the prohibition does not apply to indirect financial transactions, such as bank transfers, where the person does not act as the originator or beneficiary on a transfer of funds.
- Trade and Commerce—relatedly, the Department of Commerce is establishing a general policy of denial for license applications to export items for use by entities identified in the Cuba Restricted List.
- New Travel Restrictions for Americans
- People-to-People & Educational Travel—the new regulations de-authorize individual people-to-people nonacademic educational travel, as well as individual academic educational travel, to Cuba by US persons. Instead, all such travel must be conducted under the auspices of a US government-approved organization that sponsors such exchanges to promote people-to-people contact, and travelers must be accompanied by a US representative of the sponsoring organization.
- Support for Cuban People Travel—similarly, Americans engaging in travel under this category must engage a full-time schedule of activities which documents meaningful interaction with, and support for, individuals in Cuba, as defined in the CACR.
OFAC's announcement is available at: https://www.treasury.gov/resource-center/sanctions/OFAC- Enforcement/Pages/20171108.aspx and the Cuba Restricted List is available at:
https://www.state.gov/e/eb/tfs/spi/cuba/cubarestrictedlist/index.htm.
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