Trade Law

On June 16, 2017, the Trump administration issued a national security presidential memorandum entitled “Strengthening the Policy of the United States Towards Cuba” (the “Presidential Memorandum”). Related to this announcement, the White House issued a Cuba Fact Sheet, OFAC issued a new set of Frequently Asked Questions (FAQs) and the Department of Transportation also issued a new set of FAQs relating to the President’s announcement.

A team from Akin Gump is advising Buffalo, N.Y.-based Roswell Park Cancer Institute in a historic collaboration with Cuba-based Center of Molecular Immunology (CIM). This includes work that has secured a first-of-its-kind U.S. government license authorizing a U.S.–Cuba commercial partnership to fast-track biotech development that will help bring a groundbreaking Cuban lung cancer vaccine and other unique cancer treatments developed in Cuba to U.S. patients. This represents a landmark event in the broader rebuilding of bilateral relations between Cuba and the United States under the Obama administration's new policy of engagement.

On Monday, October 17, 2016, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) and the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) implemented amendments to the Cuban Assets Control Regulations (CACR) and Export Administration Regulations (EAR), respectively, that further ease U.S. sanctions and export controls targeting Cuba, particularly in the areas of medical research, pharmaceuticals, and trade and commerce between the United States and Cuba. These changes continue the administration’s policy of easing sanctions on Cuba to support the Cuban people and follow prior regulatory changes that occurred in January 2015, September 2015, January 2016 and March 2016. This latest action follows a Presidential Policy Directive (PPD) issued on October 14, 2016, which sets out the vision, priority objectives and actions required for normalization of relations between the United States and Cuba (see here).

On May 3, French fashion house Chanel hosted the first international fashion show in Cuba since the 1959 communist revolution. The Resort 2017 show was held open-air in Paseo del Prado, one of the city’s central streets. It was preceded by a tour of Havana, transportation for guests in a fleet of 170 1950s American convertibles and international celebrities Instagramming to #ChanelCruiseCuba.

On Wednesday, March 16, 2016, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) and the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) implemented amendments to the Cuban Assets Control Regulations (CACR) and Export Administration Regulations (EAR) that further ease the U.S. sanctions and export controls targeting Cuba, particularly related to financial transactions, travel and certain trade-related activities. These changes immediately precede President Obama’s visit to Cuba next week, building upon the previous lifting of sanctions that occurred in January 2015, September 2015 and January 2016, and supplementing the upcoming resumption of commercial air services between the United States and Cuba.

On Wednesday, January 27, 2016, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) and the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) implemented amendments to the Cuban Assets Control Regulations (CACR) and Export Administration Regulations (EAR). These amendments further ease U.S. sanctions on Cuba, continuing the implementation of the Obama administration’s new policy direction toward Cuba, as announced in December 2014. The latest amendments build upon previous changes easing U.S. sanctions on Cuba in January 2015 and September 2015 (see prior alerts here and here).

On May 5, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued guidance regarding travel between the United States and Cuba. In particular, the guidance clarifies that companies authorized to transport passengers via aircraft under general license or by commercial passenger vessel pursuant to a specific license (collectively, “Authorized Carriers”) may:

• transport persons subject to U.S. jurisdiction who are traveling under a general license under one of the 12 categories of travel in the Cuban Assets Control Regulations or by specific license issued by OFAC; Authorized Carriers may also transport certain other individuals not subject to U.S. jurisdiction from Cuba to the United States if certain criteria are met (e.g., they have a visa for travel to the United States)
• transport certain cargo from the United States to Cuba, including items in accompanied baggage that is licensed or otherwise authorized by the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) (e.g., personal effects, including limited quantities of toiletries, medicine, clothing, food and other items for personal use); Authorized Carriers may also transport other cargo or unaccompanied baggage if the export is licensed or otherwise authorized for export by BIS
• transport certain cargo from Cuba to the U.S., including items that authorized travelers may acquire while in Cuba (e.g., authorized travelers may import up to $100 of alcohol or tobacco products when returning to the United States); Authorized Carriers may also transport from Cuba to the United States other cargo authorized for importation by general or specific license and any other relevant United States government agencies.

On April 14, President Obama notified Congress of his intent to rescind Cuba’s designation as a State Sponsor of Terrorism (SSOT), issued in March 1982, saying the Cuban government “has not provided any support for international terrorism during the preceding six-month period; and the government of Cuba has provided assurances that it will not support acts of international terrorism in the future.” Although there are slightly different processes that the President Obama may take, Cuba will apparently be removed from the U.S. Department of State’s SSOT list, absent congressional action within 45 days from notification.

SSOTs are countries that the secretary of State has determined to have repeatedly provided support for acts of international terrorism. Such designations are pursuant to three laws: (i) Section 6(j) of the lapsed Export Administration Act (EAA); (ii) Section 40 of the Arms Export Control Act; and (iii) Section 620A of the Foreign Assistance Act. Aside from the diplomatic stigma attached to the SSOT designation, four main categories of sanctions result from designation under these authorities: a ban on defense exports and sales; certain controls over exports of dual-use items; restrictions on U.S. foreign assistance; and miscellaneous financial and other restrictions.