Archive for the ‘Cuba Sanctions’ Category


Jul

23

BIS Amends EAR to Remove Cuba as a State Sponsor of Terrorism


Posted by at 3:59 am on July 23, 2015
Category: BISCuba Sanctions

Cuba Capitole by y.becart(Own work) [CC-BY-SA-2.0 (http://creativecommons.org/licenses/by-sa/2.0)], via Flickr https://www.flickr.com/photos/yoh_59/13697566663[cropped]On Wednesday, the Bureau of Industry and Security amended the EAR to reflect the removal of Cuba from the list of state sponsors of terrorism. Somewhat surprisingly, the impact of this removal is much less than might be imagined.

Of most importance, even though Cuba is no longer on the list of State Sponsors of Terrorism, all items exported to Cuba will still either need a license or an applicable license exception. The biggest change is that, by removing Cuba from the E:1 country group, a few license exceptions relating to countries in that group will no longer apply.

First, certain aircraft (principally private civil aircraft not operating under certain FAA carrier certificates) will be able to use License Exception AVS for temporary sojourns to Cuba. Second, certain encryption items that were excluded from being taken by travelers to Cuba in their luggage will now be covered by License Exception BAG. Third, License Exception RPL can now be used to export replacement parts to Cuba for explosive detection equipment and concealed object detectors lawfully exported to Cuba.

If the change in RPL causes you to raise your eyebrows — explosive detection equipment and concealed object detectors in Cuba?! — settle down and take a deep breath. This is just CCL-ese for the stuff they use in airports to screen you and your luggage before you get on the plane. Nobody wants the real terrorists to target planes flying from Cuba, particularly now that they will have more Americans on them.

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Jun

17

How To Go To Jail Right Now: A Gothamist Primer


Posted by at 9:55 pm on June 17, 2015
Category: Cuba SanctionsOFAC

Cuba - Havana - Car by Didier Baertschiger [CC-BY-SA-2.0 (http://creativecommons.org/licenses/by-sa/2.0)], via Flickr https://www.flickr.com/photos/didierbaertschiger/11785935544[cropped]

Popular local website group Gothamist (which is also responsible for DCist, LAist, Chicagoist, and others) ran on its websites today the intriguingly titled: “How To Go To Cuba Right Now: A Travel Primer.”  You can guess what I think of that article by my title for this post: “How To Go To Jail Right Now: A Gothamist Primer.”

The Primer is authored by Tod Seelie, who appears to be a talented photographer, who describes his trip to Cuba.  He said he wanted to go to see the old cars, the crumbling buildings and the beaches.  Wondering if it was as “easy as buying a ticket online,” he bought a ticket from a website.  He notes he “checked ‘journalistic activity,’ though my visa ultimately identified me only as a tourist.”  And he was off.

The rest of his story details how to get an AirBNB room, the different currencies for locals and tourists, the drinkability of the water, the cost of cabs, the absence of soap in bathrooms,  the skimpy miniskirts worn by Cuban customs agents, and how hard it was for him to understand Cuban Spanish because they drop their s’s at the end of words. Finally, he noted that on the way back from what appeared to be more a vacation than anything else, the only question he was asked by the CBP agent was “Did you have fun?”

Nowhere in the article does Seelie do anything to rebut the likely assumption by his readers that anybody who wants to bop around Old Havana for a weekend getaway can just book an online ticket, sign on to AirBNB to book a room, stuff a moneybelt with cash and head off for sun and mojitos. As readers of this blog know, but readers of blogs in the Gothamist empire probably won’t know, you can’t just go to Cuba as a tourist. You have to go for one of the permitted reasons set forth in the regulations.

What about Mr. Seelie? Did he break the rules? Well, he has a colorable case that he is a journalist, since the regulations include in the definition in section 515.563 “a freelance journalist with a record of previous journalistic experience working on a freelance journalistic project.” Mr. Seelie’s bio suggests he’s published some pictures in some newspapers so we’ll give him this. But, but, but, there’s this in the rules:

The traveler’s schedule of activities does not include free time or recreation in excess of that consistent with a full-time schedule.

You be the judge whether Mr. Seelie was in Cuba for full-time journalism and incidental fun or full-time fun and incidental journalism.

UPDATE:  The article in Gothamist was written by Lauren Evans; Mr. Seelie accompanied her to Cuba to take photographs.  Although Ms. Evans clearly fits, in my view, the definition of a journalist under section 515.563, she still leaves the impression that anyone can hop on a plane and go to Cuba, which, of course, is dead wrong and can lead to an unpleasant encounter with OFAC.  And the question still remains whether she, in addition to Mr. Seelie, was there for full time journalism and incidental fun or full-time fun and incidental journalism.

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May

6

On a Slow Boat to Cuba


Posted by at 8:48 pm on May 6, 2015
Category: Cuba SanctionsOFAC

Cuba Capitole by y.becart(Own work) [CC-BY-SA-2.0 (http://creativecommons.org/licenses/by-sa/2.0)], via Flickr https://www.flickr.com/photos/yoh_59/13697566663Yesterday, the Office of Foreign Assets Control issued “guidance” on the new Cuba travel regulations. In fact, the “guidance” says little that isn’t already in the regulations, but it does serve as a reminder of at least one of the quirks in the Cuba sanctions that persists despite recent reforms.

In particular, the guidance points out that the regulations only provide for the transport of authorized travel between the United States by aircraft. No cruises allowed, unless the boat gets a specific license to provide service to Cuba for persons authorized to go to Cuba.

Now let’s dive down the rabbit hole into the “Wonderland” of export control, where if OFAC and the Bureau of Industry and Security (“BIS”) “had a world of [their] own, everything would be nonsense.”

You might think that once the boat got a license to provide service to Cuba, that would be the end of it, right?

(“‘You don’t know much,’ said the Duchess, ‘And that’s a fact.'”)

No, because OFAC licenses providing the travel service to Cuba and BIS licenses the export of the boat to Cuba.

(“At last the Dodo said, ‘everybody has won, and all must have prizes.'”)

And, yes, once the boat crosses into Cuban waters, you’ve “exported” the boat to Cuba, even if the boat turns around and heads straight back for the United States.

(“‘When I use a word,’ Humpty Dumpty said, in rather a scornful tone, ‘it means just what I choose it to mean — neither more nor less.'”)

If travel is provided by an airplane “of U.S. registry operating under an Air Carrier Operating Certificate” instead of a boat, then the short little foray into Cuban territory is covered by License Exception AVS, and no license is required.

(“When I used to read fairy-tales, I fancied that kind of thing never happened, and now here I am in the middle of one!”)

So what is the difference, for any conceivable policy purposes, between an airplane and a boat?

(“The Hatter opened his eyes very wide on hearing this; but all he said was, ‘Why is a raven like a writing-desk?'”)

All I can figure, is that a boat is more comfortable and has better food than the coach cabin of an airplane and the U.S. doesn’t want to make it all that easy to get to Cuba.

(“No, I give it up,” Alice replied: “What’s the answer?” “I haven’t the slightest idea,” said the Hatter.)

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Apr

16

Thursday Grab Bag


Posted by at 8:05 am on April 16, 2015
Category: Crimea SanctionsCriminal PenaltiesCuba SanctionsIran SanctionsOFACSudanSyria

Grab BagHere are a few recent developments that you may have missed:

  • Last month we criticized the Department of Justice for conspiring with foreign luxury car makers to jail U.S. citizens who exported luxury cars to China to arbitrage the difference between U.S. and Chinese prices for these vehicles. Apparently, the DoJ now is having second thoughts about wasting taxpayer money and its resources on this nonsense. According to the  New York Times, settlements have recently been reached in nine states where prosecutors have agreed to return seized cars to, and drop charges against, luxury car exporters. Good.
  • On Monday we reported that Obama was going to drop Cuba from the list of state sponsors of terrorism, a move we thought was largely symbolic. Yesterday he did just that, and provided the 45-day notice required under the three acts that provide the basis for the list: § 6(j)(4)(A)(i)-(iii) of the Export Administration Act of 1979; § 40(f)(1)(A)(i)-(iii) of the Arms Export Control Act; and § 620A(c)(1)(A)-(C) of the Foreign Assistance Act of 1961. The linked New York Times article wrongly states that Congress can block this action with a joint resolution. Only the Arms Export Control Act provides for this blocking mechanism, and, as we noted, there’s no way that the White House will remove Cuba from the current arms embargo. So a joint resolution under the AECA would be, like the removal itself, largely symbolic
  • The Office of Foreign Assets Control (“OFAC”) revised its rules on Monday to amend the Syrian Sanctions Regulations to permit certain activities with respect to written publications, including the ability to pay advances and royalties, to substantively edit manuscripts and to create marketing campaigns. These activities have been permitted for Cuba, Sudan and Iran since 2004. Don’t try this yet in Crimea which remains, bizarrely and incomprehensibly, the most heavily sanctioned place on the face of the planet
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Apr

13

White House May Take Cuba off Terrorism List


Posted by at 8:35 pm on April 13, 2015
Category: BISCuba SanctionsDDTC

Cuba - Havana - Car by Didier Baertschiger [CC-BY-SA-2.0 (http://creativecommons.org/licenses/by-sa/2.0)], via Flickr https://www.flickr.com/photos/didierbaertschiger/11785935544[cropped]

There have been news reports suggesting that Obama is contemplating, as part of the thaw in U.S.-Cuba relations, to remove Cuba from the list of countries that are state sponsors of terrorism. Beyond the symbolic significant of such a move, what would be the real consequences?

Of course, one consequence of being on the list is that, under section 40 of the Arms Export Control Act, 22 U.S.C. § 2780, any country put on the list of state sponsors of terrorism is automatically subject to an arms embargo. Of course, even if Cuba is removed from the list, I would not count on arms shipments from the U.S. to Havana in the foreseeable future.

Second, section 6(j) of the defunct Export Administration Act, 50 App § 2405, requires a license for exports to state sponsors if the export could make a “significant contribution to the military potential of such country” or if it could “enhance the ability of such country to support acts of international terrorism.” And, in those instances, Congress must be given notice of such exports thirty days in advance. Of course, the Export Administration Act is no longer in force and is only even in the appendix to Title 50 of the U.S.C. because the President breathes life into it every year using the superpowers bestowed on him by the International Economic Emergency Economic Powers Act. So the White House could end any license requirement for Cuba and end the notification requirement using the same superpowers that resurrected those provisions in the first place.

You might also think that removing Cuba from the list might make it easier to ship agricultural products, medicine and medical devices to Cuba under the Trade Sanctions Reform and Export Enhancement Act of 2000. After all, the Act, in section 7205, imposes a license requirement for shipping those goods to a sanctioned country if that country is also on the state sponsor of terrorism list. However, that section specifically identifies Cuba as a state sponsor of terrorism and imposes the license requirement on exports of agricultural products, medicines and medical products to Cuba. So, removing Cuba from the terrorism list will not eliminate the need for exporters to Cuba to continue to file the export notifications required to utilize License Exception AGR for TSRA exports to Cuba.

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