United States Cuba Policy & Business Blog

Friday, September 4, 2009

Positive News - New Cuba Travel and Business Regulations - Another Step in the Right Direction

New Cuba Sanctions and Travel Brochure:
New Cuba Regulations in Detail:

-New Travel and Business Regulations in Effect
* No limits on visits or cash remittances to Cuban family
* U.S. banks can set up remittance exchange facilities
* Big potential seen for telecommunications firms (Adds details, reaction, new Commerce Dept. rules)

By David Lawder

WASHINGTON, Sept 3 (Reuters) - Americans with relatives in Cuba can send them unlimited cash and visit the island as long and often as they would like under new rules that fissured a nearly five-decade trade embargo on Thursday.
The rules, made effective immediately by the U.S. Treasury Department, fleshed out an announcement by President Barack Obama in April to ease U.S. trade restrictions imposed on Cuba after Fidel Castro's leftist revolution half a century ago.
Until now, Cuban-Americans had been allowed to travel to the island only once a year and were limited to sending only $1,200 per person in cash to needy family members in Cuba.
But now they can send as much money as they want to a larger group of relatives that includes aunts, uncles, cousins and second cousins, a reversal of a restriction introduced by the Bush administration in a bid to squeeze Cuba's communist government financially.
"That is something that will help a lot," said Enrique Gonzalez, a 64-year-old military retiree in Havana. "Despite the global financial crisis, the relatives will send a lot of remittances, which will help everybody here," he said.
But the Treasury's Office of Foreign Assets Control, which has policed the trade embargo and fined Americans caught spending money in Cuba, said U.S. visitors could only spend $179 a day on trips to the island.
That is the same amount as the U.S. State Department's per diem rate for official visits. Previously, family travelers were allowed to spend just $50 a day.
Separate regulations issued by the U.S. Commerce Department doubled the value limit for gift parcels sent to Cubans to $800 per month and widened the allowed recipients. Non-monetary gifts could only be sent previously to immediate family members and they may now be sent to any individual or to independent religious, educational and charitable organizations in Cuba.
The Commerce Department also eliminated a 44-pound limit on personal baggage to Cuba and allows visitors to bring donated personal communications devices such as mobile phone systems, computers, software, satellite receivers and digital cameras.
But the loosening of the rules for Cuban-Americans did not affect a general ban on travel by American citizens to Cuba and tight restrictions on academic and cultural exchanges.
The rules provide for some changes that could lay the groundwork for future trade links between the United States and Cuba in banking and telecommunications.
Relaxation of the remittance rules allow U.S. banks to set up exchange arrangements with Cuban institutions to handle the transfers. The lack of such financial exchanges was considered a hindrance to the growth of agricultural trade with Cuba that was first allowed nearly a decade ago.
The Treasury rules allow U.S. telecommunications companies to set up fiber-optic cable and satellite links and enter into cell-phone roaming service agreements with Cuba. They allow U.S. residents to pay for satellite radio and television services provided to Cuban individuals by third-country firms.
The rules allow transactions and travel related to establishing telecoms services between the two countries.
Washington attorney Robert Muse, who specializes in Cuba issues and closely follows the Cuba embargo regulations, said he was encouraged by this provision, which could mean a genuine loosening of the U.S. trade sanctions in the telecoms area.
"If they have allowed the U.S. telecommunications industry to actually provide real technology in pursuit of telecommunications projects in Cuba, then ... it opens a market for U.S. suppliers that had been shut out of Cuba," he added.
The Treasury also established a general travel license to Cuba for U.S. employees of firms seeking to sell agricultural and medical products there.
Companies providing charter flights between the United States and Cuba said they expected a spike in passenger business as a result of the new regulations.
"There will definitely be a rush," said Vivian Mannerud, President of Airline Brokers Company, which has been operating since 1982.
"It was absolutely needed whether it be for business or from the humanitarian aspect, or just plain old freedom to travel and being able to visit your family whenever you want to," Mannerud told Reuters. (Reporting by David Lawder, additional reporting by Jeff Franks in Havana and Pascal Fletcher in Miami and Doug Palmer in Washington, Editing by Anthony Boadle)