2017 June OFAC Announced Changes

I have been traveling to Cuba for almost a decade and for the last 3 years I have been developing programs and projects in and about Cuba for organizations, groups, and individuals.  Through my consulting company Diaspora Travel & Trade, www.DiasporaTravelTrade.com, I curate unique experiences for my clients and create opportunities for my family, friends, and colleagues in Cuba.

My team and I have expertise in program and project management, commercial and business development experience, and personal and professional relationships and resources in Cuba.  We leverage this knowledge to offer Diaspora clients a well-balanced project or program that incorporates, in compliance with US laws, the various constituencies represented in Cuba: Government and Enterprise - both public and private - and Cultural and Community Organizations.  Diaspora clients receive more than branded generic program packages; we fill our programs with strategic and unique opportunities and insight.

Regarding the most recent changes to the US Embargo Against Cuba as it relates to travel to Cuba by those subject to US Jurisdiction, the bottom line is this: (1) The Embargo is still in place, therefore tourist travel is prohibited; and (2) Travel to Cuba for non-tourist activities is still licensable pursuant to a number of different OFAC categories.

On October 19, 1960, the US Government placed an embargo (prohibition) on all exports to Cuba, except for food and medicine.  Since then, the US Embargo Against Cuba, known in Cuba as el bloqueo ("the blockade”), has grown to consist of a number of Federal statutes and associated regulations that form a commercial, economic, and financial embargo against Cuba.  The Embargo is comprehensive, detailing all prohibited activity - almost all direct or indirect financial activity by any persons or entities subject to US Jurisdiction that involves the Cuban Government, Cuban property, or Cuban nationals – and any exceptions to these restrictions.  Additionally, they are written so that the Executive Branch has the discretion to broaden or narrow certain areas. 

The Embargo prohibits transactions related to and necessary for travel (purchasing flights, accommodations, food, etc.), whether paid for by the person subject to US Jurisdiction, one subject to a third party country, or for free.  Those whose travel activities qualify for a “general license” or “specific license” as they are defined by the laws relevant to their travel dates, are exempted from these particular financial prohibitions.  Over the years, various Administrations have changed the elements required to obtain and comply with general and specific license procedures.

On December 17, 2014, US President Barack Obama and Cuban President Raúl Castro announced their respective country’s intentions to reestablish diplomatic relations in an effort to begin to normalize relations between the neighboring nations.  During the remainder of his term, President Obama and his Administration continued to use the Executive Power to “loosen” the restrictive nature of the Embargo.  There were many results, one of which was that those subject to US Jurisdiction could travel to the island nation with less restrictions.  President Obama’s final changes made many feel that the Travel Embargo had been lifted because of the relatively relaxed license requirements; those subject to US Jurisdiction were permitted to travel to Cuba if the travel activities qualified under one of the 12 travel categories that were authorized by “general license” by the US Treasury Department, Office of Foreign Asset Control (“OFAC”); license activities included signing an affidavit attesting to the OFAC category, participating in a licensed program, and maintaining all financial records associated with the trip for at least 5 years.  Additionally, travelers we were able to purchase commercial flights with US airlines. 

Although there are 12 categories, we most often hear about the People-to-People License pursuant to 31 CFR §515.565(b) (“PIIP”), which requires meaningful contact with the Cuban people.  It also requires that travelers have a fixed itinerary with scheduled events.  Prior to the recent changes, both Individual and Group PIIP travel was licensable, where the difference is that Group PIIP Travel is “under the auspices of an organization that is subject to U.S. jurisdiction that sponsors such exchanges to promote people-to-people contact.” OFAC June 16, 2017 (OFAC) Frequently Asked Questions on President Trump’s Cuba Announcement.  The most recent changes as they related to PIIP Travel are very simple, Individual PIIP will again be prohibited once OFAC issues the new Regulations.  However, Group PIIP is still licensable as well as the remaining 11 other categories.