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What you
need to know about the U.S. Embargo
(Treasury Document)
Office of Foreign Assets Control
U.S. Department of the Treasury
Cuban Assets Control Regulations
(Title 31 Part 515 of the U.S. Code of Federal Regulations)
INTRODUCTION - The Cuban Assets Control Regulations were issued by the U.S.
Government on 8 July 1963 under the Trading With the Enemy Act in response
to certain hostile actions by the Cuban government. They are still in force
today and affect all U.S. citizens and permanent residents wherever they are
located, all people and organizations physically in the United States, and
all branches and subsidiaries of U.S. organizations throughout the world.
The Regulations are administered by the U.S. Treasury Department's Office of
Foreign Assets Control. The basic goal of the sanctions is to isolate Cuba
economically and deprive it of U.S. dollars. Criminal penalties for
violating the sanctions range up to 10 years in prison, $1,000,000 in
corporate and $250,000 in individual fines. Civil penalties up to $55,000
per violation may also be imposed. Please note that the Regulations require
those dealing with Cuba to maintain records, and, upon request from the U.S.
Treasury Department, to furnish information regarding such dealings.
SELLING TO CUBA - Except for publications and other informational materials,
and certain humanitarian goods licensed for export by the U.S. Department of
Commerce, such as medicine and medical supplies, no products, technology or
services may be exported from the United States to Cuba, either directly or
through third countries, such as Canada or Mexico. This prohibition includes
dealing in or assisting the sale of goods or commodities to or from Cuba,
even if done entirely offshore. Such "brokering" is considered to be the
export of a service. Provision of consulting services is also prohibited.
Furthermore, no U.S. citizen or permanent resident alien, wherever located,
and no foreign subsidiary or branch of a U.S. organization may export
products, technology, or services to Cuba or "broker" the sale of goods or
commodities to or from Cuba.
Section 1705(b) of the Cuban Democracy Act provides for donations of food to
nongovernmental organizations or individuals in Cuba. Shipments of food can
be donated to non-governmental organizations from the U.S. or from third
countries, without the need for a license from the U.S. government. Under
Section 1705(c) of the same act, exports of medicines and medical supplies
are allowed, but require a license issued by the U.S. Commerce Department.
U.S. banks may handle the financial aspects of licensed transactions, but
may not use blocked funds to pay for such shipments. The Act specifically
provides that payments to Cuba involving telecommunications may be made
pursuant to specific license. In the mid-1970's, Section 515.559 had been
added to the Cuban Assets Control Regulations to allow OFAC to license
foreign subsidiaries of U.S. firms to conduct trade with Cuba so long as
several specific criteria were met. Section 1706( a) of the CDA prohibits
the issuance of a license that would have been issued pursuant to Section
515.559, except where a contract was entered into prior to enactment of the
CDA. Exports of medicines and medical supplies by foreign subsidiaries may
be considered for licensing.
No vessel carrying goods or passengers to or from Cuba or carrying goods in
which Cuba or a Cuban national has any interest may enter a U.S. port. The
prohibition also applies to vessels which enter only to take on fuel and
supplies (bunker), whether from U.S. fuel providers within the port limits
or at offshore points, as well as vessels discharging or loading merchandise
offshore, by lighter or otherwise. In addition, vessels which enter a port
or place in Cuba to engage in the trade of goods or services are prohibited
from loading or unloading any freight at any place in the U.S. for 180 days.
BUYING FROM CUBA - Goods or services of Cuban origin may not be imported
into the United States either directly or through third countries, such as
Canada or Mexico. The only exceptions are $100 worth of Cuban merchandise
which may be brought into the United States as accompanied baggage by
authorized travelers arriving from Cuba and publications, artwork, or other
informational materials.
SPECIALLY DESIGNATED NATIONALS - The Regulations prohibit buying from or
selling to Cuban nationals whether they are physically located on the island
of Cuba or doing business elsewhere on behalf of Cuba. Individuals or
organizations who act on behalf of Cuba anywhere in the world are considered
by the U.S. Treasury Department to be "Specially Designated Nationals" of
Cuba. Their names are published in the Federal Register, an official
publication of the U.S. Government. A listing of such Specially Designated
Nationals may be obtained by calling the Office of Foreign Assets Control at
202/622-2420. The listing, however, is a partial one and any U.S. individual
or organization engaging in transactions with foreign nationals must take
reasonable care to make certain that such foreign nationals are not
specially designated. Specially Designated Nationals of Cuba operating in
the United States are subject to criminal prosecution. U.S. individuals or
organizations who violate the Regulations by transacting business with them
are also subject to criminal prosecution or civil monetary penalties.
ACCOUNTS AND ASSETS - There is a total freeze on Cuban assets, both
governmental and private, and on financial dealings with Cuba; all property
of Cuba, of Cuban nationals, and of Specially Designated Nationals of Cuba
in the possession of U.S. persons is "blocked." Any property in which Cuba
has an interest which comes into the United States is automatically blocked
by operation of law. Banks receiving unlicensed wire transfer instructions
in which there is a Cuban interest, or any instrument in which there is a
Cuban interest, must freeze the funds on their own books or block the
instrument, regardless of origin or destination. "Suspense accounts" are not
permitted. Blocking imposes a complete prohibition against transfers or
transactions of any kind. No payments, transfers, withdrawals, or other
dealings may take place with regard to blocked property unless authorized by
the Treasury Department. Banks are permitted to take normal service charges.
Blocked deposits of funds must be interest-bearing. "Set-offs" are not
allowed.
U.S. persons are required to exercise extreme caution in order not to
knowingly involve themselves in unlicensed transactions in which Cuba has an
interest. No bank in the U.S. nor overseas branch or subsidiary of a U.S.
bank may even advise a letter of credit involving Cuba nor may it process
documents referencing Cuba. All such "property" must be blocked as soon as
it comes within the bank's possession or control. U.S. persons who engage in
any commercial dealings that involve unauthorized trade with Cuba, either
directly or indirectly, are at risk for substantial monetary penalties and
criminal prosecution.
SENDING GIFTS - Gift parcels may be sent or carried by an authorized
traveler to an individual, or to a religious, charitable, or educational
organization in Cuba for the use of the recipient or of the recipient's
immediate family, subject to the following limitations: the combined total
domestic retail value of all the items in the parcel must not exceed $200
per month; not more than one parcel may be sent or given by the same person
in the U.S. to the same recipient in Cuba in any one calendar month; and
content must be limited to food, vitamins, seeds, medicines, medical
supplies and devices, hospital supplies and equipment, equipment for the
handicapped, clothing, personal hygiene items, veterinary medicines and
supplies, fishing equipment and supplies, soap-making equipment, or certain
radio equipment and batteries for such equipment. Organizations that
consolidate and send multiple gift parcels in single shipments must obtain a
validated license from the U.S. Department of Commerce. Each gift parcel in
the single shipment must meet commodity, dollar-value, and frequency
limitations. If a parcel being shipped or carried to Cuba fails to meet
these standards, it is subject to seizure by the U.S. Government.
TRAVEL TO CUBA - Only persons whose travel falls into the categories
discussed below are authorized to spend money related to travel to Cuba
without obtaining special permission from the U.S. Treasury Department. Even
that money may be spent only for purchases of items directly related to
travel such as hotel accommodations, meals, local transportation, and goods
personally used by the traveler in Cuba at a rate not to exceed $100 per day
and for the purchase of $100 worth of Cuban merchandise to be brought into
the United States as accompanied baggage. Purchases of services unrelated to
travel, such as non-emergency medical services, are prohibited. The purchase
of publications and other informational material is not restricted.
The following categories of travelers are permitted to spend money for Cuban
travel without the need to obtain special permission from the U.S. Treasury
Department:
Official Government Travelers - U.S. and foreign government officials,
including representatives of international organizations of which the United
States is a member, who are traveling on official business.
Journalists regularly employed in such capacity by a news reporting
organization.
Persons who are traveling to visit close relatives in Cuba in circumstances
of extreme humanitarian need. This authorization is valid without a specific
license from the Office of Foreign Assets Control only once every twelve
months.
Specific licenses may be issued by the Office of Foreign Assets Control on a
case by case basis authorizing travel transactions by persons in connection
with the following travel categories:
Humanitarian Travel - (1) persons traveling to Cuba more than once in a
twelve month period to visit close relatives in cases involving extreme
hardship, such as terminal illness or severe medical emergency; (2) persons
traveling to Cuba to accompany licensed humanitarian donations (other than
gift parcels); or, (3) persons traveling in connection with activities of
recognized human rights organizations investigating specific human rights
violations.
Travel in connection with professional research or similar activities, for
clearly defined educational or religious activities, or for purposes related
to the exportation, importation, or transmission of information and
informational materials, including provision of telecommunications services.
U.S. travel service providers, such as travel agents and tour operators, who
handle travel arrangements to, from, or within Cuba must hold special
authorizations from the U.S. Treasury Department to engage in such
activities. These authorizations are issued based on written applications
from the service providers, subject to appropriate checks by the Treasury
Department. A traveler should not use any travel service provider that does
not hold valid Treasury authorization. If in doubt about the status of a
service provider's authorization, travelers should call the Office of
Foreign Assets Control at 202/622-2430.
SENDING MONEY TO CUBA - Remittances, including family remittances, may no
longer be sent to Cuba without a specific license from the Office of Foreign
Assets Control, except for payments of up to $1,000 for fees and travel to
enable a close relative to emigrate from Cuba to the United States. A close
relative means a spouse, child, grandchild, parent, grandparent,
great-grandparent, uncle, aunt, brother, sister, nephew, niece, first
cousin, or spouse, widow, or widower of any of those people. A close
relative also means mother-in-law, father-in-law, daughter-in-law,
son-in-law, sister-in-law, or brother-in-law. Service providers, including
banks originating transfers on behalf of non-aggregating customers, must
obtain an affidavit from the remitter certifying that the Cuban immigrant
has a valid U.S. Visa. The affidavit must contain the full name, date of
birth, and Visa date and number of the Cuban traveler. A travel remittance
may not be sent without an affidavit and affidavits must be kept on file.
FAIR BUSINESS PRACTICES - Anyone authorized by the U.S. Department of the
Treasury to provide Cuban travel services or services in connection with
sending money to Cuba is prohibited from participating in discriminatory
practices of the Cuban government against individuals or particular classes
of travelers. The assessment of consular fees by the Cuban government, which
are applicable worldwide, is not considered to be a discriminatory practice.
However, requiring the purchase of services not desired by the traveler is
not permitted. Persons wishing to provide information on such activities
should call 202/622-2430. All information regarding arbitrary fees, payments
for unauthorized purposes, or other possible violations furnished to the
U.S. Treasury Department will be handled confidentially.
ESTATES AND SAFE DEPOSIT BOXES - An estate becomes blocked whenever a Cuban
national is an heir or is the deceased; money from a life insurance policy
is blocked whenever the deceased is a Cuban resident. It is now possible for
the heir of a person who died in Cuba, or the beneficiary of a life
insurance policy of a person who died in Cuba, to apply for a license from
the U.S. Treasury Department to unblock the estate or insurance proceeds.
Persons administering or interested in a blocked estate should contact the
Department's Office of Foreign Assets Control at 202/622-2480 for more
information. A safe-deposit box is blocked whenever a Cuban has an interest
in the property contained in the box. Access to a blocked safe deposit box
for inventory purposes may be granted under certain conditions, but the
contents of the box remain blocked and may not be removed without the
permission of the U.S. Treasury Department.
PAYMENTS FOR OVERFLIGHTS - Private and commercial aviators must obtain a
specific license authorizing payments for overflight charges to Cuba. Banks
will ask to see the originals of such licenses before executing transfers
and keep a copy for their files. Such transfers must be in a currency other
than U.S. dollars.
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