On January 16, 2015, the Office of Foreign Assets Control (OFAC) of the US Treasury Department, which is responsible for enforcement of the economic sanctions laws, published in the Federal Register new regulations following up on the President’s December 17, 2014, announcement of an easing of certain sanctions in place against Cuba. While most Cuban sanctions remain in place, there was some easing with respect to travel, flow of information and authorized commerce.
Some of the new regulations relate to financial transactions. As of January 16, 2015, the following actions are permissible:
- Persons now may send remittances to persons resident in Cuba (other than prohibited officials of the Cuban government or members of the Cuban Communist Party and subject to certain other restrictions) in an amount up to $2,000 per quarter (up from $500 per quarter)
- Persons traveling to Cuba may now bring up to $10,000 in remittances per authorized trip (up from $3,000)
- US banking organizations, money transmitters and registered securities brokers or dealers are permitted to process authorized remittances to Cuba, but will have to comply with recordkeeping and reporting requirements (previously, specific licenses were required)
- Authorized travelers to Cuba will be able to use their US bank credit or debit cards, provided that the particular bank has set up the appropriate process for them to be used in Cuba (previously, this was prohibited)
- A US banking organization may establish a bank account for itself (a correspondent account) at a Cuban bank or foreign bank located in Cuba to facilitate the processing of authorized transactios, but there is no general license for Cuban banks or Cuban nationals to open an account at a US bank (previously, opening such an account by a US banking organization was prohibited)
- US banking organizations will be able to reject funds transfers flowing through the United States from a non-US originator to a non-US beneficiary in Cuba where neither the originator nor the beneficiary is a person subject to US jurisdiction, provided certain prohibited Cuban persons do not have an interest in the transfer (previously, if such a transfer came into a US banking organization, the funds became blocked)
- US banking organizations are authorized to process funds transfers flowing through the United States from a non-US originator to a non-US beneficiary in Cuba where neither the originator nor the beneficiary is a person subject to US jurisdiction, when they would be authorized under the revised Cuban sanctions regulations if the originator or beneficiary were a person subject to US jurisdiction (previously, this was prohibited)
OFAC also has issued a set of Frequently Asked Questions about the new regulations.
Please see our client alert at on the new Cuban sanctions regulations.