US Rolling Back Cuba Sanctions - Permits Expanded Payment
The Treasury Department will publish a final rule tomorrow that rolls back more of the Cuba sanctions by amending the Cuban Assets Control Regulations, 31 C.F.R. part 515 (the "CACR"), to make it easier to receive payments for aircraft parts (and other commodities) that are sold to Cuban business partners. The new rule comes out of the Treasury Department's Office of Foreign Asset Control (OFAC).
The changes appear to permit US persons to receive funds from Cuban customers for non-agricultural export transactions. This does not permit all transactions, but it does lay the foundation for receiving payment for transactions that that are permitted. In September, we reported that ASA members wishing to sell aircraft parts to Cuban business partners could now apply for a license from the Bureau of Industry and Security (BIS) in order to legally sell and export such commercial aircraft parts.
Don't forget that there is an OFAC general license that authorizes the export from the United States to Cuba in those cases where the export is already licensed or otherwise authorized by the Commerce Department's Bureau of Industry and Security (BIS). 15 C.F.R. 515.533(a)(1). This means that if you can obtain a BIS license, and you do not run afoul of other US restrictions, then you do not need to obtain a separate OFAC license.
As of today, the forms of allowable payment are limited by the OFAC general license provisions (15 C.F.R. 515.533(a)(2)); but when the new final rule is published, it is expected that payment and financing terms for authorized (e.g. licensed) exports will no longer be restricted.
A draft of the final rule is available online now, and it is expected to be available at http://federalregister.gov/a/2016-01559 tomorrow or shortly after tomorrow, once it is published.