Charting A New Course for Cuba re: Diplomatic Relations with Cuba
Wednesday, December 17, 2014
Charting A New Course for Cuba

Today, President Obama made a historic announcement describing steps by which the United States will ease sanctions against Cuba after five decades of isolation.  This announcement followed the release of two U.S. citizens by the Cuban government: Alan Gross and an unnamed intelligence officer.  Gross was detained by the Cuban government in 2009 while working as a USAID subcontractor.  The intelligence officer, described as “one of the most important intelligent agents” that the U.S. has ever had in Cuba had been imprisoned in Cuba for nearly two decades.

Obama said that the significant changes announced today would “end an outdated approach.” He described the sanctions imposed on Cuba by the U.S. for half a century as having “little effect.”

The President outlined three main measures in his announcement to change the relationship between the United States and Cuba:

1. Diplomatic Relations.  First, Secretary of State John Kerry will initiate discussions with Cuba to reestablish diplomatic relations.  The United States would also establish a U.S. Embassy in Havana that high-ranking U.S. officials will visit.

2. Designation as State Sponsor of Terrorism.  Second, Secretary Kerry will review Cuba’s designation as a sponsor of terrorism.  A White House press release issued today states that the results of the review must be reported to the President in the next six months.

3. Authorizations for Travel and Commercial Transactions.  Third, the United States will institute a policy of expanded travel authorizations and authorizations for financial and commercial transactions to Cuba.  This policy will facilitate increased exports to Cuba.  Recognizing that the trade embargo against Cuba is codified in legislation, President Obama stated that he would engage Congress in an “honest and serious debate about lifting the embargo.”

As noted, the White House issued a press release today that includes more detail about the changes in policy announced by President Obama, including the types of goods and services that will be authorized for export.  These goods and services include building materials, agricultural equipment, and telecommunication equipment.

Also today, the Office of Foreign Assets Control (“OFAC”) updated its FAQs, which included the following:

Q.  How will OFAC implement the changes to the Cuba sanctions program announced by the President on December 17, 2014?  Are the changes effective immediately?

A.  OFAC will implement the Treasury-specific changes via amendments to its Cuban Assets Control Regulations. The Department of Commerce will implement the remainder of the changes via amendments to its Export Administration Regulations.  OFAC expects to issue its regulatory amendments in the coming weeks.  None of the announced changes takes effect until the new regulations are issued.

While President Obama’s announcement for a new approach is encouraging for the people of the United States and Cuba, and will certainly increase commercial opportunities for U.S. businesses, these changes will not take place overnight.  We will keep watch as policies and laws related to Cuba are updated.  President Obama made clear that the decades-long isolation has not worked, and it is time for the United States “cut loose the shackles of the past.”

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