Another Liebherr Of Switzerland Crane On Way To Cuba; Addition To Rental Fleet For Womy Equipment Of The Netherlands. More Competition For Caterpillar & Deere

From LinkedIn Post: “Behind the scenes, the Womy team has been busy acquiring new equipment for our rental fleet in Cuba! One of these editions is the Liebherr LRT 1090-2.1. Our brand new crane is already on its way to Cuba! Many thanks to Liebherr_nederland B.V. and Martijn Esveldt for always assisting us! #Liebherr #Womy” LINK To Womy Office In ZED Mariel In Cuba

Womy Equipment (Rental and Supply) is part of [Hoogvliet, The Netherlands-based] Mobilift International [subsidiary of Hoogvliet, The Netherlands-based Peinemann Mobilift Groep B.V.; 2019 revenue approximately US$220 million; office in Spring, Texas].

Bulle, Switzerland-based Liebherr-International AG (2019 revenues approxiamtely US$13 billion) is a global manufacturer of “earthmoving, mining, mobile cranes, tower cranes, concrete technology, maritime cranes, aerospace, and transportation systems, machine tools and automation systems, domestic appliances, and components.” The company has fourteen offices in the United States.

LINK To Liebherr LRT 1090 2.1 Description: https://www.liebherr.com/en/usa/products/mobile-and-crawler-cranes/mobile-cranes/liebherr-rough-terrain-cranes/lrt-1090-2.1.html

From Womy Equipment: “We have continued expanding our activities since our foundation in 1996. We now specialise in the rental, sale and service of all kinds of equipment. All over the world you can find public transport, lift trucks, warehouse trucks, mobile cranes, aerial platforms, container handling equipment, earthmoving and construction equipment which bears our signature. Expanding our potential and capabilities within the diversity of this trade, has allowed to participate and undertake far-reaching and complex projects around the world. Our main office is located in the port of Moerdijk, close to the ports of Rotterdam, Amsterdam and Antwerp. The 20.000m² area offers warehousing, a construction and maintenance site, offices and stock parking. Our group owns companies in Cuba, Ivory Coast, Portugal, Poland, Romania, Oman, Ghana, Turkey and Liberia. Working on an international scale implies showing respect for the cultures we work with. It also means investing in a partnership with local authorities and companies to help them achieve their goals. Merely supplying goods isn’t enough. We are a full service company which believes in cooperation.”

LINK To Related Post: Liebherr Of Austria, Womy of Germany, Peinemann Of The Netherlands, Bouygues Of France Link For Hotel Construction Equipment To Cuba. Competition For Caterpillar And Deere. 27 April 2021

Port Of Moerdijk, The Netherlands-Base Womy Equipment Supply: “We have continued expanding our activities since our foundation in 1996. We now specialise in the rental, sale and service of all kinds of equipment. All over the world you can find public transport, lift trucks, warehouse trucks, mobile cranes, aerial platforms, container handling equipment, earthmoving and construction equipment which bears our signature. Expanding our potential and capabilities within the diversity of this trade, has allowed to participate and undertake far-reaching and complex projects around the world. Our main office is located in the port of Moerdijk, close to the ports of Rotterdam, Amsterdam and Antwerp. The 20.000m² area offers warehousing, a construction and maintenance site, offices and stock parking. Our group owns companies in Cuba, Ivory Coast, Portugal, Poland, Romania, Oman, Ghana, Turkey and Liberia.  Working on an international scale implies showing respect for the cultures we work with. It also means investing in a partnership with local authorities and companies to help them achieve their goals. Merely supplying goods isn’t enough. We are a full service company which believes in cooperation. 

The opening of Womy Equipment Rental in ZED Mariel: “[Mariel, Cuba] Tuesday 31st October 2017: Womy Equipment Rental [https://www.womy.cu/en/], the extension of the already existing Womy Equipment Supply B.V. (2016), has officially opened the doors of their 1st facility in ZED Mariel Cuba.  Womy Equipment Supply has been around in Cuba for quite some time. With over 26 years of experience in providing all sorts of transport, lifting and after sales solutions, the company expands their current course of actions with a rental company.” LINK To ZED Mariel 

“Womy Equipment Supply has already been involved with renting equipment in Cuba before. Womy Equipment Supply won the tender of changing the flares at Havana's refinery in cooperation with Cubiza. All the meetings, the discussions and studies regarding the possibilities of the execution, in combination with the opportunity offered by ZED Mariel, enlightened the spark for Womy to start a company only involved with the rental of equipment, Womy Equipment Rental.” 

“Womy Equipment (Rental and Supply) is part of [Hoogvliet, The Netherlands-based] Mobilift International [subsidiary of Hoogvliet, The Netherlands-based Peinemann Mobilift Groep B.V.; 2019 revenue approximately US$220 million; office in Spring, Texas] Mobilift International is known for its huge equipment rental operations throughout the Netherlands, especially in the harbour of Rotterdam. However, Mobilift's focus is internationally active as well. With offices in multiple parts of Europe, West-Africa, the Middle East and now their second office in Cuba, the group is becoming a global player in the horizontal- and vertical transport industry.” 

“A lot of experience, knowledge and expertise is a result of clustering all offices within Mobilift International. With combining all forces of the offices together, a strong foundation has been built for Womy Equipment Rental in Mariel. The office will be the centre point for the support in construction, logistics, renewable energy, and repair industry in Cuba.” 

Caterpillar And Deere & Company In Cuba 

In 2017, Deere & Company (2019 revenues approximately US$39.26 billion) established a distribution center in the Republic of Cuba, joining San Juan, Puerto Rico-based RIMCO, the Republic of Cuba distributor for Peoria, Illinois-based Caterpillar Inc. (2019 revenues approximately US$53.8 billion) established the same year.  At the time, neither Deere & Company nor Caterpillar issued media releases or posted information on their respective Internet sites.  

Since November 2017, Deere & Company delivered more than US$800,000.00 in agricultural equipment to the Republic of Cuba for use at its distribution center. Antioch, Tennessee-based Wirtgen America, Inc., a subsidiary of Windhagen, Germany-based Wirtgen Group (2020 revenues approximately US$3 billion), a construction equipment machinery subsidiary (acquired in 2017) of Deere & Company has also delivered products to the Republic of Cuba.  RIMCO continues to deliver equipment for use at its distribution center in the Republic of Cuba, including excavators, backhoes, graders, scrapers, bulldozers, railway fixtures, and signaling equipment, valued at more than US$4 million since December 2018.  

John Deere Financial Services was to provide payment terms/financing for the exports, primarily Series 5000 (price range US$25,000.00 to US$80,000.00) with a limited quantity of Series 7000 (price range US$219,000.00 to US$280,000.00).  According to the company, several hundred tractors, parts and accessories may be exported from the United States to the Republic of Cuba during the next four years, with the first deliveries (for testing and evaluation) scheduled for mid-November 2017.  The potential value of the several hundred products exported from the United States to the Republic of Cuba that would be financed could range from US$9 million to US$30 million.  John Deere Financial Services has not commented as to whether the product sales goals have been achieved or if there have been issues relating to the receipt of payments.  Caterpillar has not disclosed if the company has provided payment terms for its products exported to the Republic of Cuba. 

Cuba Central Bank- Cellular Minutes May Not Be Converted To Bank Balances

Cuba Standard
Sarasota, Florida
13 September 2021

CUBA STANDARD — Phone minutes, which have emerged as a sort of alternative currency for remittances since the U.S. government blocked most remittance channels, cannot be converted into bank balances, the Cuban Central Bank announced.

Reverting previous regulations, Resolution 216, published in the Gaceta Oficial Sept. 3, prohibits the conversion of phone recharges from abroad into bank balances, independent news site El Toque first reported.

In March, the Central Bank allowed state telecom ETECSA to facilitate financial transactions through the Transfermóvil platform’s mobile wallet. Under that previous regulation, Cuban customers were able to transfer their phone top-up balance into hard-currency (MLC) bank accounts that could then be withdrawn in cash at ATMs.

The new resolution clarifies that bank cards are the only way to deposit funds in mobile wallets, and that the money cannot be withdrawn in the form of cash but may be transferred between bank accounts and wallets. ETECSA is not authorized to act as a remittance channel. The Central Bank also announced an increase in the maximum mobile wallet balance to 15,000 CUP and transaction amounts to 7,500 CUP.

China's Support For Cuba Has Limitations When Exports Of Cellular Devices To United States Impacts Xiaomi Corporation

Despite the commercial, economic, and political support provided to the Republic of Cuba by the People’s Republic of China, including the provision of equipment to develop the 800-mile long archipelago’s cellular network for use by its 11.3 million citizens, the ability of and desire by People’s Republic of China-based companies to export to the United States continues to impact exports to the Republic of Cuba.  Every relationship has its limitations…

“14. Exportation: 14.2 The Contract and all Products sold are subject to applicable export control laws, including but not limited to the export control laws of. the US and Buyer’s own jurisdiction. The Buyer will not export any product purchased from the Seller to any country or territory or anywhere if the export control laws forbid it. Prohibited countries and territories include Cuba, Iran, Syria, North Korea, Sudan, and the Crimea region. If the Buyer plans to export any Products purchased from the Seller to another country, the Buyer you must obtain the required export licenses (or other government approvals) before doing so.” 

From The Company 

“[Beijing, China-based] Xiaomi Corporation [2020 revenues approximately US$38 billion] was founded in April 2010 and listed on the Main Board of the Hong Kong Stock Exchange on July 9, 2018 (1810.HK).  Xiaomi is a consumer electronics and smart manufacturing company with smartphones and smart hardware connected by an IoT platform at its core.  Embracing our vision of “Make friends with users and be the coolest company in the users’ hearts”, Xiaomi continuously pursues innovations, high-quality user experience and operational efficiency. The company relentlessly builds amazing products with honest prices to let everyone in the world enjoy a better life through innovative technology.”

“Xiaomi is one of the world's leading smartphone companies. The company’s market share in terms of smartphone shipments ranked no. 2 globally in the second quarter of 2021. The company has also established the world’s leading consumer AIoT (AI+IoT) platform, with 374.5 million smart devices connected to its platform (excluding smartphones and laptops) as of June 30, 2021, excluding smartphones and laptops.  Xiaomi products are present in more than 100 countries and regions around the world.  In August 2021, the company made the Fortune Global 500 list for the third time, ranking 338th, up 84 places compared to 2020.  Xiaomi is a constituent of the Hang Seng Index, Hang Seng China Enterprises Index, Hang Seng TECH Index and Hang Seng China 50 Index.” 

Global Times
Beijing, China
12 September 2021

Xiaomi's reported move to lock smartphones in Cuba, Iran, North Korea, Crimea not targeting any specific market: company

Xiaomi's reported move to lock smartphones in countries and regions including Cuba, Iran, Syria, North Korea, Sudan and Crimea is "not targeting any specific market," and it is a cross-regional governance that aims to prevent smuggling through the grey market and protect user data security, the company's spokesperson told the Global Times on Sunday.

The statement comes after some media reported that the Chinese handset-maker blocked its smartphones in the countries and regions mentioned earlier, where the company has not set up an official presence.  Xiaomi's export policy does not allow its customers to export any products to those banned countries and regions. However, according to media reports, a grey market has been expanding in recent years and it has been quite common for customers to buy Xiaomi devices in one region and use them in another.

Some media have attributed Xiaomi's recent move to lock its handsets to the US' "long-arm jurisdiction," speculating that Washington is exerting pressure on the Chinese company to block phones used in those sanctioned countries and regions.  In response, Xiaomi said that it "temporarily" locked some smartphones to prevent and investigate potential smuggling that hurt users' information security and consumers' rights. "The investigation has achieved significant results, and the affected devices can be unlocked now," Xiaomi's spokesperson said.  

In the Q2 of 2021, shipment of Xiaomi smartphones ranked second in the global market for the first time, buoyed by a rapid growth in overseas markets, according to a report issued by Gartner.  Xiaomi also accounts for about 15 percent of the market share in Cuba, according to data by research firm Statcounter. 

Priceworms.com 

Xiaomi has quickly climbed the ladder up the mobile manufacturing industry to become one of the world’s most renowned brand. Xiaomi is a Chinese based privately owned business that is known for manufacturing of smartphones, consumer electronics, TVs, fitness tracers and other electronic accessories. The smartphone manufacturer is known for its low-cost high-end smartphones, competing some of the biggest names in industry.  Xiaomi mobiles hasn’t got the fame and acceptability in American smartphone market like it has over some of the other markets in the world. Still, it is fast becoming a popular brand in many major Cuba's cities including Havana, Holguin, Santa Clara, Trinidad, and Varadero etc. The mobile phone manufacturer relies heavily of flash sales and digital marketing concepts that helps its cause to save on traditional marketing costs; consequently, offering cheaper product than most competitors.  The company has recently launched its latest high-end MI Mix2 smartphone in Cuba. The smartphone is quickly gaining attention of large Cuba mobile market segment for its premium bezel-less design, ultra-high features, and low cost. The average cost of Xiaomi mobiles in Cuba range CUC200 to CUC450.  Though the mobile isn’t available with any major Cuba carrier services, still keeping the low cost of products in mind, the smartphone is definitely a catch for people looking for high-end features at some seriously low prices.

Irony? In 1994, Minnesota-Based Carlson Companies Led U.S. Businesses In Interest Towards Cuba. In 2021, Its CWT- European Parliament Brussels (EPB) Refuses To Provide Travel Services To Cuba

“This clearly raises the question of how the European Parliament could have chosen an agency, which is restricted in its activities by foreign legislation…. With regard to the current contract with CWT, the delegation wishes to examine whether a culpa in eligendo (negligence in choice of contractor) was committed.” (9/9/2021) 

EUobserver
Brussels, Belgium
13 September 2021

MEPs' Cuba trip foiled by US embargo 

European Parliament's in-house travel agency is paid a monthly management fee of €157,082, according to 2018 budget report  

By Nikolaj Nielsen  

The European Parliament's in-house travel agency, CWT Global, is a US owned-company and therefore will not be able to book MEP flights to Cuba - because of the American embargo against Havana.  [Since 2017, CWT has served the European Parliament.].  This clearly raises the question of how the European Parliament could have chosen an agency, which is restricted in its activities by foreign legislation," said Tilly Metz, a Green MEP from Luxembourg, in a recent letter sent to European Parliament president David Sassoli.  The letter comes comes ahead of a European Parliament resolution on Cuba this week, and amid a wider discussion on EU strategic autonomy on the global stage.  Metz chairs the European Parliament's delegation to Central America (DCAM), which had over the summer requested a September mission to Cuba.  But CWT then refused to book the flights, citing US sanctions, says Metz.  The letter came as leaders of the parliament's political groups, known as the Conference of Presidents, approved the delegation's mission to Cuba.  The issue came to light after the delegation's secretariat had asked CWT to provide quotes for flights to Cuba. [Link To Letter].

"To our surprise however, the travel agency could not provide a quote because, as a US-owned company, it has to respect the US embargo against Cuba," said Metz, in her letter.  She says the US embargo also apply to other countries like Iran - tossing a possible spanner into other future MEP visits. Metz said CWT had to instead outsource the flights to another agency, leading to delays.  CWT Global itself has yet to respond for a comment.  It won a travel agency tender for both the European Parliament and the European Ombudsman.  A 2018 European Parliament budget report says the firm is paid a monthly management fee of €157,082 and employed 37 staff.  For its part, the EU opposes the US blockade of Cuba but also condemned Havana's crackdown against July protests.  DCAM's vice-chairs are German centre-right MEP Jens Gieseke and Spanish liberal Javier Nart.  Both are said to be unhappy about the US sanctions on the travel agency and had agreed to have DCAM send the letter to Sassoli. 

USA TODAY
27 December 1994
Arlington, Virginia

CUBA SEEKS PARTNERS- U.S. firms ready to tap opportunity 

By Micheline Maynard 

CUBA: OPEN FOR BUSINESS; See info boxes at end of text; See related stories: 02B, 06B 

(excerpts) HAVANA - Carlson, the Radisson hotel/restaurant powerhouse, wants to open a TGI Friday's restaurant in Havana, restore a historic hotel and build a lavish resort on one of Cuba's 300 pristine beaches… Peter Blyth, executive vice president of Minneapolis-based Carlson, thinks Cuba will quickly become U.S. travelers' top destination in the Caribbean once the embargo is lifted…  Blyth, who has lobbied on Capitol Hill for the USA to open trade with Cuba, says the time is right. "There is tremendous potential out there," he says. “And there's nobody in a better position than (U.S. companies) to take advantage of it.” 

Minnetonka, Minnesota-based CWT US, LLC (formerly Carlson Wagonlit Travel, Inc.) (2020 revenues approximately US$1.5 billion).  Founded as Gold Bond Stamps in 1938, the company became Carlson Companies in 1973.  Diemen, Netherlands-based CWT Global B.V. (2020 transaction volume approximately US$24.4 billion) was created in 2006.   

• 1994- Carlson Companies, Inc. of Minneapolis and the Paris-based Accor Group combine the business travel interests of their respective companies, Carlson Travel Network and Wagonlit Travel, under the name Carlson Wagonlit Travel.

• 1997- Carlson Travel Network in the United States and Wagonlit Travel in Europe merge to form the Carlson Wagonlit Travel network for business travel.

• 2006- A change in CWT's shareholding structure also occurs in August: Carlson and One Equity Partners (OEP) acquire Accor's 50% stake in CWT. Carlson becomes majority shareholder with 55% of CWT shares, while OEP holds the remaining 45%.

• 2014- In June, Carlson enters into a definitive agreement with JP MorganChase to acquire full ownership of CWT. 

“CWT is a Business-to-Business-for-Employees (B2B4E) travel management platform. Companies and governments rely on us to keep their people connected – anywhere, anytime, anyhow. Across six continents, we provide their employees with innovative technology and an efficient, safe and secure travel experience backed by our three core promises: to simplify corporate travel, to connect to unlock possibilities, and to move forward, together.” 

From Moody’s Investors Service: “Formed in 1997, Carlson Travel is a leading global business travel management company (TMC), serving corporations of all sizes as well as government institutions around the world. In 2019 CWT reported net revenues of $1.5 billion. Carlson Travel operates in nearly 145 countries and territories worldwide, with around 16,000 employees in its wholly owned operations. The company provides the following services: (i) Corporate Traveler Services, providing both online and full-service offline travel bookings for corporate and government clients; (ii) Meetings & Events Services, assisting clients to create and manage meetings and events on a cost effective basis; and (iii) Roomit hotel distribution services, providing a comprehensive hotel inventory and booking solution for clients and their business travelers, as well as distribution platform for over 800,000 hotels.”

LINK To Complete Analysis In PDF Format

The 46th President Of The United States Continues What The 28th President Of The United States Signed Into Law: Trading With The Enemy Act. Since 1960, Cuba Has Remained A Target

The White House
Washington DC
7 September 2021

Presidential Determination
No. 2021-12

MEMORANDUM FOR THE SECRETARY OF STATE, THE SECRETARY OF THE TREASURY

SUBJECT: Continuation of the Exercise of Certain Authorities Under the Trading With the Enemy Act

Under section 101(b) of Public Law 95-223 (91 Stat. 1625; 50 U.S.C. 4305 note), and a previous determination on September 9, 2020 (85 FR 57075, September 14, 2020), the exercise of certain authorities under the Trading With the Enemy Act is scheduled to expire on September 14, 2021.

I hereby determine that the continuation of the exercise of those authorities with respect to Cuba for 1 year is in the national interest of the United States.

Therefore, consistent with the authority vested in me by section 101(b) of Public Law 95-223, I continue for 1 year, until September 14, 2022, the exercise of those authorities with respect to Cuba, as implemented by the Cuban Assets Control Regulations, 31 C.F.R. Part 515.

The Secretary of the Treasury is authorized and directed to publish this determination in the Federal Register.

JOSEPH R. BIDEN JR.

LINK To Federal Register Document

U.S. Agricultural Commodity And Food Product Exports To Cuba Increased 54.8% In July 2021; And Increased 88.0% Year-To-Year

ECONOMIC EYE ON CUBA©
September 2021

July 2021 Food/Ag Exports To Cuba Increase 54.8%- 1
57th Of 222 July 2021 U.S. Food/Ag Export Markets- 2
Year-To-Year Exports Increase 88.0%- 2
Cuba Ranked 52nd Of 222 U.S. Ag/Food Export Markets- 2
July 2021 Healthcare Product Exports US$142,548.00- 2
July 2021 Humanitarian Donations US$340,950.00- 3
2021 Obama Administration Initiatives Exports Continue- 3
U.S. Port Export Data- 16

JULY 2021 FOOD/AG EXPORTS TO CUBA INCREASE 54.8%- Exports of food products and agricultural commodities from the United States to the Republic of Cuba in July 2021 were US$19,832,195.00 compared to US$12,809,286.00 in July 2020 and US$31,176,621.00 in July 2019. 

July 2021 Exports Included: Chicken Leg Quarters (Frozen); Chicken Meat (Frozen); Chicken Legs (Frozen); Corn; Coffee; Dog and Cat food; Blood; Wood (Hickory). Poultry represented 90.9% of exports and corn represented 8.5% of exports.

January 2021 through July 2021 exports were US$178,774,363.00 compared to US$95,045,548.00 for the period January 2020 through July 2020.

Since December 2001, agricultural commodity and food product exports reported from the United States to the Republic of Cuba is US$6,475,001,787.00.

This report contains information on exports from the United States to the Republic of Cuba- products within the Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000, Cuban Democracy Act (CDA) of 1992, and regulations implemented (1992 to present) for other products by the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury and Bureau of Industry and Security (BIS) of the United States Department of Commerce.

The TSREEA re-authorized the direct commercial (on a cash basis) export of food products (including branded food products) and agricultural commodities from the United States to the Republic of Cuba, irrespective of purpose. The TSREEA does not include healthcare products, which remain authorized and regulated by the CDA.

COMPLETE REPORT IN PDF FORMAT

Did U.S. Department Of Justice “Intervene” And Tip The Scale In A Libertad Act Title III Cuba Lawsuit On Behalf Of United Kingdom-Based Company? Defendants Hope So.

Has United States Department Of Justice “Intervened” On The Constitutionality Of A Libertad Act Title III Cuba Lawsuit On Behalf Of United Kingdom-Based Company?

A Good Day For Defendants.

Legally, What DOJ Did Might Not Be Defined As Intervening. From A Layperson Perspective Seems Just That.

DOJ Filed With Court Statement That May Not Have Been Required To Be Filed. Though Statement Is Not Binding, It Is Influential.

Thumb On The Scale? For Whose Interest? Impact Of Sixty-Day Clock? Poisoning Of The Well?

Could DOJ Could Have Filed Statement Without Referencing Three Other Lawsuits?

Is The Statement “Too Cute By Half”?

On 31 August 2021, the United States Department of Justice (DOJ) in Washington DC filed its first “Statement of Interest of the United States” (SOIOTUS) in a Libertad Act Title III lawsuit. The lawsuit was filed in the United States District Court for the Southern District of Florida.

The Trump Administration on 2 May 2019 made operational Title III of the Cuban Liberty and Democratic Solidarity Act of 1996 (known as “Libertad Act”). Title III authorizes lawsuits in United States District Courts against companies and individuals who are using a certified claim or non-certified claim where the owner of the certified claim or non-certified claim has not received compensation from the Republic of Cuba or from a third-party who is using (“trafficking”) the asset.

A defendant in the lawsuit is headquartered in the United Kingdom. Bristol, United Kingdom-based Imperial Brands plc (2020 revenues approximately US$45 billion) is listed among the thirty-largest companies in the United Kingdom. Prior to the United Kingdom existing the EU on 31 January 2020, the defendant, Imperial Brands plc (formerly Imperial Tobacco plc) was subject to decisions of the Brussels, Belgium-based European Commission (EC), the governing entity for the now twenty-seven member Brussels, Belgium-based European Union (EU). From Imperial Brands: “Our Imperial Tobacco subsidiaries manufacture and market a range of cigarettes, fine cut and smokeless tobacco products, mass market cigars, and tobacco accessories such as papers and tubes…. Key Imperial Tobacco subsidiaries include Reemtsma in Germany, Altadis in Spain and Seita in France as well as our Imperial Tobacco businesses in the UK, Australia, Poland, Russia and Ukraine.”

Questions abound.

• Why did the DOJ select this lawsuit? No defendant in other Libertad Act Title III lawsuits served notice to the DOJ, but DOJ may weigh-in on any lawsuit.

• Why did the DOJ respond? The statute (28 U.S.C. Section 517) does seem to require the DOJ to respond. The statute includes “may” not “must”

• Is the DOJ seeking to “tip the scale” in favor of the defendant(s) and telegraphing Biden-Harris Administration (2021- ) thinking that Title III is unconstitutional or thinking about basis to suspend Title III? The Clinton-Gore Administration (1993-2001), Bush-Cheney Administration (2001-2009), Obama-Biden Administration (2009-2017), and until 2019 Trump-Pence Administration (2017-2021) did suspend Title III in six-month increments as permitted by the Libertad Act.

• Is there a political consideration directed to The Honorable Boris Johnson, Prime Minister of the United Kingdom (UK)?

• Why did not the DOJ file a SOFOTUS in any of the Libertad Act Title III lawsuits that include defendants with headquarters in the EU?

Since 2 May 2019, forty-one (41) Libertad Act Title III lawsuits have been filed in United States District Courts throughout the United States. One lawsuit is reported settled out-of-court. Some of the lawsuits have been dismissed, some have been consolidated, some have been appealed, and some have been withdrawn.

Since the first Libertad Act Title III lawsuit was filed, ten (10) defendants are headquartered within the twenty-seven member countries of the EU and twenty (20) defendants are headquartered in non-EU-member countries.

LUIS MANUEL RODRIGUEZ, MARIA TERESA RODRIGUEZ, a/k/a MARIA TERESA LANDA, ALFREDO RAMON FORNS, RAMON ALBERTO RODRIGUEZ, RAUL LORENZO RODRIGUEZ, CHRISTINA CONROY, and FRANCISCO RAMON RODRIGUEZ, Plaintiffs, v. IMPERIAL BRANDS PLC, CORPORACIÓN HABANOS, S.A., WPP PLC, YOUNG & RUBICAM LLC, and BCW LLC, a/k/a BURSON COHN & WOLFE LLC [1:20-cv-23287; Southern Florida District].

Berenthal & Associates (plaintiff)
Rodriguez Tramont & Nunez (plaintiff)
Nelson Mullins (defendant)
Allen & Overy (defendant)
Wilmer Cutler Pickering Hale and Dorr (defendant)
Broad & Cassel (defendant)
Akerman (defendant)
Trenam, Kemker, Scharf, Barkin, Frye, O’Neill & Mullis (defendant)
Rabinowitz, Boudin, Standard, Krinsky & Lieberman (defendant)

Link To Statement Of Interest Of The United States (8/31/21)
Link To 28 U.S.C. Sec. 517
Link To 28 U.S.C. Rule 5.1
Link To Defendant Corporación Habanos, S.A.’S Notice Of Constitutional Question (4/29/21)
Link To Memorandum Of Law In Support Of Defendant Imperial Brands Plc’s Motion To Dismiss The Amended Complaint- Claim Of Unconstitutionality (4/28/21)
Link To Defendant Imperial Brands Plc’s Notice Of Constitutional Question (4/28/21)
Link To Defendants’ Supplemental Briefing In Further Support Of Their Motion To Dismiss The Amended Complaint (8/18/21)
Link To Libertad Act Title III Lawsuit Filing Statistics

Excerpts From Statement Of Interest

“The United States of America, by and through undersigned counsel, respectfully submits this Statement of Interest pursuant to 28 U.S.C. § 5171 to set forth the interests of the United States (the “Government”) as they relate to the above-captioned lawsuit. The Government is not a party to this matter and takes no position on the merits of Plaintiffs’ claims. However, the Government received a notice, pursuant to Federal Rule of Civil Procedure 5.1,2 that Defendants Imperial Brands PLC (“Imperial”) and Corporación Habanos, S.A. (“Habanos”) have challenged the constitutionality of Title III of the Cuban Liberty and Democratic Solidarity (Libertad) Act, 22 U.S.C. §§ 6081–6085 (“Title III”) in their pending motions to dismiss.

The Government became aware of the constitutional challenge to Title III in April 2021 after Imperial and Habanos served notices of constitutional questions on the Attorney General of the United States pursuant to Rule 5.1. ECF Nos. 92, 94; see Fed. R. Civ. P. 5.1(a). As framed by Imperial, “[t]he constitutional question raised is: does the Due Process Clause of the Fifth Amendment to the United States Constitution prohibit the extraterritorial application of Title III to Imperial’s concededly ‘non-U.S.’ Cuban-cigar business under the circumstances alleged in the Complaint due to lack of legislative jurisdiction.”

The Court has not yet certified the constitutional challenge. See Fed. R. Civ. P. 5.1(b) (“The court must, under 28 U.S.C. § 2403, certify to the appropriate attorney general that a statute has been questioned.”). Nonetheless, the Government files this Statement of Interest upon the completion of the parties’ briefing on the Motions, including supplemental briefing filed on August 18, 2021, see ECF Nos. 123–24, to respectfully request that the Court decide the personal jurisdiction issues before reaching the constitutional question and, only if the Court finds it necessary to reach and certify the constitutional question, to respectfully request that the Court provide the Government an opportunity to participate at that stage.

The Government has reviewed the parties’ arguments on the Motions and notes that Imperial and Habanos raise several arguments in support of dismissal that do not depend on the constitutionality of Title III or other Title III issues. In particular, the Government believes that the defendants’ arguments concerning lack of personal jurisdiction raise substantial questions, similar to those that three courts in this district have already addressed.

See Iglesias v. Pernod Ricard, No. 20-20157-CIV, 2021 WL 3083063, at *3 (S.D. Fla. June 17, 2021) (no personal jurisdiction over French company with French principle place of business even where subsidiary did business in Florida); Herederos de Roberto Gomez Cabrera, LLC v. Teck Res. Ltd., No. 20-21630-CIV, 2021 WL 1648222, at *3–4 (S.D. Fla. Apr. 27, 2021) (no personal jurisdiction over foreign defendant with foreign principle place of business in Title III action where plaintiff “fail[ed] to explain how its claim for unlawful trafficking in Cuba is related to [the plaintiff’s] activities in Florida”), reconsideration denied, No. 20-21630-CIV, 2021 WL 3054908 (S.D. Fla. Jul. 20, 2021); Del Valle v. Trivago GmbH, No. 19-22619-CIV, 2020 WL 2733729, at *2–4 (S.D. Fla. May 26, 2020) (same), appeal filed, 20-12407 (11th Cir. Jun. 24, 2020).

The Government therefore declines to intervene at this stage of the litigation but will continue to actively follow developments in this case as it progresses, particularly regarding the constitutional question concerning Title III, should the Court decide not to dismiss this matter on other grounds. If the Court does find it necessary to address the constitutional question, the Government requests a further opportunity to consider whether to provide its views at that time. The Government thanks the Court for its consideration of the Government’s views at this stage.”

From Imperial Brands

“Our Imperial Tobacco subsidiaries manufacture and market a range of cigarettes, fine cut and smokeless tobacco products, mass market cigars, and tobacco accessories such as papers and tubes…. Key Imperial Tobacco subsidiaries include Reemtsma in Germany, Altadis in Spain and Seita in France as well as our Imperial Tobacco businesses in the UK, Australia, Poland, Russia and Ukraine.”

27 Apr 2020- Imperial Brands PLC agrees sale of Worldwide Premium Cigar Business for €1,225 million with proceeds to be used to reduce debt

Background on Premium Cigars: The business comprises assets purchased as part of Imperial’s acquisition of Altadis in 2008, and the disposal consists of two transaction perimeters: Premium Cigar US: Tabacalera USA, which is responsible for the business’ premium cigar operations in the US, the world’s largest premium cigar market, including: The assets and other property of Altadis USA, which is responsible for the distribution of premium cigars in the US; Leading online retail platforms, including JR Cigar, cigar.com and Serious Cigars; A specialist brick-and-mortar retailer, Casa de Montecristo, with 28 stores across the USA. Premium Cigar RoW: Cuban premium cigar interests, including: A 50 per cent stake in Habanos S.A., which exports hand-made cigars from Cuba and is responsible for international marketing activities. Habanos products include world-renowned Cuban brands such as Cohiba, Montecristo and Romeo y Julieta. A 50 per cent stake in Altabana S.L., which is responsible for the distribution of Cuban cigars worldwide through its network of over 20 subsidiary distributors. A 50 per cent stake in Internacional Cubana de Tabaco, S.A., which is responsible for the manufacturing of Cuban premium machine-made cigars. A 50 per cent stake in Promotora de Cigarros, S.L., which manages the distribution of the Cuban premium machine-made cigar portfolio worldwide. Other sales of premium cigar products through Tabacalera SA including: Exclusive distribution of Cuban handmade cigars in Spain; Non-Cuban premium handmade cigar sales operations outside the US, including Vegafina, the bestselling non-Cuban brand outside the US.

26 February 2013- Investor Day Presentation. “Firstly, I would like to put it in the context of the Total Cigar market. Premium cigars only account for around 3% of the units of the total traditional cigar market, but have a much more relevant participation in value and margin terms. It’s a niche but high value oriented business. USA is the largest Premium Cigar market with more than 60% of total sales. Adding Western Europe both represent around 85% of total consumption. In the rest of the world, mainly emerging markets, where 90% of the population lives, the knowledge of Premium cigar culture is very limited and sales per capita are still low. With the increasing purchasing power for many living in these countries and western lifestyle becoming more popular, there is significant growth potential for Premium cigars. Cuba, Dominican Republic, Nicaragua and Honduras are the main production origins. Cuban origin cigars have more than 70% of market share excluding the USA where these products are forbidden. In this category, Imperial enjoys a solid global leadership position with around 40% of market share in units thanks to: Our partnership with Cuba in Habanos, the global leader and marketer of the prestigious Cuban brands; Our strong presence in the USA; and The increasing international development of our brands, complementing the Cuban offer. During last fiscal year we’ve achieved double digit growth in our main indicators, 11% in units and 10% in sales value, with sales going up across all our operations. Our Cuban business showed a very good dynamism in emerging markets where our sales increased by 17% in line with the increasing demand of luxury products in these territories. Countries like China (+13%), Russia (+38%), Brazil (+15%) and areas like Middle East (+19%) are becoming increasingly important for us. In the USA, we had a very positive performance, mainly driven by a stronger focus on our key strategic brands, underpinned by innovative product initiatives. We are covering all price segments with our core assets: our Cuban heritage brands Montecristo and Romeo y Julieta in the high end, VegaFina in the mid-price and Casa de Garcia in the low end, all made in our Dominican and Honduran factories. And finally, our international business, complementing our Cuban offer, grew significantly, driven by VegaFina expansion, in line with our commitment to develop this brand as our non-Cuban global Premium brand.”

LINK TO COMPLETE ANALYSIS IN PDF FORMAT

By Today, State Department And Treasury Department Were To Deliver Remittance Recommendations To President Biden. Did They? When Will Decisions(s) Be Announced? Implemented?

UPDATE: Received from the United States Department of State at 3:15 pm on 1 September 2021: "The Administration formed a U.S. governmental Remittance Working Group to review available options for remittance channels so the Cuban people receive the maximum benefit from remittances their families in the United States send. We can confirm that the Remittance Working Group, co-led by the Department of State and the Department of the Treasury, delivered its recommendations to the White House on August 30."

Taken Collectively, Commercial And Economic Decisions By Cuba During In 2021 Are Openings For Biden-Harris Administration Remittance Re-Engagement To Support Re-Emerging Private Sectors. 

The White House
Washington DC
30 July 2021

President Joe Biden: “And the direct State- and I’ve directed the State Department and the Treasury Department to provide me, within one month, recommendations of how to maximize the flow of remittances to the Cuban people, without the Cuban military taking their cut. And we’re working to increase U.S. staffing at our embassy while prioritizing the safety of our personnel.”

Tuesday, 31 July 2021, is “within one month,” and the [Cuba] Remittance Working Group (RWG) recommendations will be presented to President Biden. 

By today, the RWG will, if not already, present to President Biden its recommendations for financial re-engagement with the Republic of Cuba.  

Unknown is when President Biden will review the recommendations and then determine which, if any, of the recommendations he will implement. 

Issues relating to decision-making about withdrawals from Afghanistan, the recurring multi-country impact of “Havana Syndrome” upon employees of the United States government, and social media-related regulations issued by the government of the Republic of Cuba will permeate negatively the decision-making process.   

The Biden-Harris Administration (2021- ) will attempt the impossible- wanting not to be perceived as providing value to the Diaz-Canel-Valdes Mesa Administration (2019- ) in Havana.  The focus will shift from wanting to provide nothing to limiting what is provided and conditioning where possible what is provided. 

There exists an influential constituency within the Biden-Harris Administration and outside of the Biden-Harris Administration who support United States regulations and policies remaining as they are despite hardship inflicted upon the 11.3 million citizens of the Republic of Cuba, with the goal to force more promptly further commercial, economic, and political change within the Republic of Cuba.  The constituency’s baseline is from evaluating decisions taken by the Diaz-Canel-Vales Mesa Administration particularly during the last three months- since the protests of 11 July 2021, but collectively since 1 January 2021- and reasonably expecting that the dire financial condition within the 800-mile archipelago will continue, may become worse, and result in a further lessening of control by the government.   

Thus, the goals of the Biden-Harris Administration will include balancing perceived and actual value to the government of the Republic of Cuba with perceived and actual value to the 11.3 million citizens of the Republic of Cuba.  There will be an emphasis upon support for the re-emerging private sectors in the Republic of Cuba which continue to represent the most efficient means of further separating control by the state with self-determination. 

During the last nearing nine months, and increasing in frequency during the last three months, the Diaz-Canel-Valdes Mesa Administration has provided foundational assistance to the Biden-Harris Administration by publishing regulations (and publishing intentions to publish regulations) that directly impact commercial and economic sectors.  While there remain questions as to how the regulations will be implemented, the expectation is with the government of the Republic of Cuba deeply in debt to importers, exporters, and service providers- and with the situation unlikely to improve quickly, the words in published regulations that are or seem now to be constrictive will eventually be expansive later.   

The last ninety days for the Republic of Cuba have, from a commercial perspective, been astonishing in swiftness and depth.  Some of what has been approved: Duties and fees eliminated on certain imports; Regulation of cryptocurrency; Postal service to provide financial services; Financing for purchases; Private sector increases access to suppliers, foreign currency; Suspension of tariffs and fees for residential solar systems; Regulations for micro, small, and medium-size enterprises (MSMEs); and Adoption of the LLC as an ownership format. 

Since 1 January 2021, the government of the Republic of Cuba merged its two operational currencies, the Convertible Peso (CUC- 1 to US$1.00) and the Cuban Peso (CUP- 24 to US$1.00) leaving the CUP.  The CUP remains overvalued (“street” value is 60-70 to US$1.00).  Further official devaluation is expected perhaps by the end of 2021.  There has been decentralization within the commercial sectors, though there remain opportunities for additional changes.  Expanded use by private companies of Republic of Cuba government-operated Fincimex-created American International Services (AIS) card cards issued by Republic of Cuba government-operated Banco Metropolitano.  Expanded use of Moneda Libremente Convertible (MLC) for transactions.  Republic of Cuba government-operated companies and private sector companies may retain from 80% to 100% of revenues from exports. 

For the Biden-Harris Administration there now exists opportunities to be practically proactive rather than reactive absent of practical operational considerations.   

Authorizing transactions (direct investment, direct financing, direct correspondent banking, U-turn transactions, electronic remittance transfers) that directly (not through third countries) and immediately provide value to the re-emerging private sectors.   

Because the government of the Republic of Cuba has yet to authorize something is not a reason for the government of the United States to wait until they do so.

The White House
Washington DC
30 July 2021

President Joe Biden: “And the direct State- and I’ve directed the State Department and the Treasury Department to provide me, within one month, recommendations of how to maximize the flow of remittances to the Cuban people, without the Cuban military taking their cut. And we’re working to increase U.S. staffing at our embassy while prioritizing the safety of our personnel.”

Tuesday, 31 July 2021, will be “within one month,” and the Remittance Working Group [RWG] recommendations are due to be presented to The President.

From a United States Department of State spokesperson: "The Administration has formed a U.S. governmental Remittance Working Group to review available options to establish remittance channels so that the Cuban people receive the maximum benefit from remittances their families send. At the President’s direction the State Department and the Treasury Department will provide recommendations to the President for how to maximize remittances to the Cuban people, while minimizing or eliminating the Cuban military’s ability to take a cut." 

The White House
Washington DC
15 July 2021

President Joe Biden: “Cuba is a -- unfortunately, a failed state and repressing their citizens. There are a number of things that we would consider doing to help the people of Cuba, but it would require a different circumstance or a guarantee that they would not be taken advantage of by the government -- for example, the ability to send remittances to -- back to Cuba. I would not do that now because the fact is it’s highly likely that the regime would confiscate those remittances or big chunks of it.” 

LINK To Complete Analysis In PDF Format

LINKS To Recent Remittance-Related Analyses  

Healthcare Crisis In Cuba Provides Additional Questions And Opportunities For Biden-Harris Administration To Address Electronic Remittance Transfers... And Do So Practically August 19, 2021

Binary: Electronic Remittance Transfer Decision For Biden Administration And Diaz-Canel Administration; And Putting US$20 Million Into Perspective August 12, 2021

Cuba Adopting LLC Structure For Private Sector Is A Message To Biden-Harris Administration- Even If That Was Not [Primary] Intention. Familiarity For Sources Of Investment And Financing. August 30, 2021

Cuba Issues 175 Pages Of Regulations For Micro, Small And Medium-Sized Enterprises (MSME's) August 20, 2021

Defining "Transformative"- Cuba Ratifies Decree-Law Authorizing SME's: Micro (1-10 employees), Small (11-35 employees), Medium (35-100 employees). The Private Sector Has Returned. August 07, 2021

Cuba Links Resumption Of Remittances From United States To Expanding Investment Opportunities For Cuban Residents Abroad August 06, 2021

Cuba Expands Again Role Of Private Sector- Suppliers, Foreign Currency Access August 05, 2021

Cuba Suspends Tariffs And Fees For Non-Commercial (SME's Next?) Solar Systems. Another Opportunity For Biden-Harris Administration To Support U.S. Exporters And Florida Companies Should Benefit. July 30, 2021

Biden-Diaz-Canel Remittance Compromise: U.S. And Cuba Companies Suspend Transaction Fees Until 31 December 2021. Impact On 800 Publix Markets July 27, 2021

U.S. Department Of State Memorandum: The 17 Company Members Of The CRWG- Moving Remittances And Using Remittances; Cuba Entities Need Be Part Of The Process July 26, 2021

If A Product Costs At Least 2,500 Pesos (US$104.16), Customers In Cuba Now May Obtain Financing: Terms Are 2.5% Interest With 20% Down July 24, 2021

Biden Administration Wants To Deny Cuba's Government (Military) With Earnings- Conditional Resumption Of Product Filled Flights To Airports In Cuba Benefits Self-Employed; By-In From Congress? July 19, 2021

Is Biden-Harris Administration Nearing Decision To Reverse Trump-Pence Administration Prohibition On Cuba Military Earning Money From Remittances? July 15, 2021

Cuba Central Bank Authorizes Cuba's Postal Service To Provide Financial Services. Continuing Expansion For Receiving And Spending Funds Assists Private Sector Aug 27, 2021

Cuba Central Bank Moving Nearer To Regulations For Cryptocurrencies- Another Signal To United States That Cuba Is Changing. Private Sectors Are Expanding- Though Government Remains Reluctant August 27, 2021

Cuba Adopting LLC Structure For Private Sector Is A Message To Biden-Harris Administration- Even If That Was Not [Primary] Intention. Familiarity For Sources Of Investment And Financing.

For companies, investment platforms, and individuals subject to United States jurisdiction, the 175-pages published in the Gaceta Oficial by the Ministry of Justice of the Republic of Cuba on 19 August 2021 were profound in that by their existence they conveyed deficiencies and provided opportunities within the commercial environment of the Republic of Cuba.  LINK To Document 

The private sector in the Republic of Cuba as currently structured is not sufficient, the private sector as structured is devoid of capital, the private sector as structured is unable to preserve existing societal demands nor create opportunities required by current and future generations of Republic of Cuba nationals.   

Doubtful that ideological acolytes, purists of the Partido Comunista de Cuba (PCC) believe in the inherent value of private enterprise let alone crafting and implementing a legal structure create it, to protect it, and then to nurture it.   

Within the PCC, pragmatists, however, seek inspiration, and thus survival from commercial, economic, and political models of the People’s Republic of China and Socialist Republic of Vietnam rather than Democratic People’s Republic of Korea. 

Most striking in the 175-pages were the letters in Chapter II, Constitution of MPIYMES [micro, small, and medium-sized enterprises], Section On, Generalities:  

• Article 11. MIPYMES are constituted as commercial companies, which adopt the form of a limited liability company, hereinafter SRL, by deed public, which is registered in the Mercantile Registry and with its registration acquire personality legal.

• Article 12. The form of LLC implies the existence of a commercial company, with own legal personality, whose capital is divided into social shares and is composed of the contributions of all the partners, who do not respond personally of social debts.

• Article 13. MIPYMES can be made up of one or more partners.

• Article 14.1. The name of the MSMEs necessarily includes the indication "Limited Liability Company" or its abbreviation "S.R.L." 

The government of the Republic of Cuba was adopting, legalizing, the Limited Liability Company, known as the LLC.   

The definitions and regulations thus far adopted by the government of the Republic of Cuba do not mirror precisely those found amongst the fifty states of the United States, although there are remarkable similarities- and those similarities will over time shift increasingly toward United States norms.  LINK To State of Florida LLC Requirements  

While some observers may dismiss the decision as insignificant, as a gesture absent substance, as a morbid joke, careful- and artful analysis belies any concern about appearance.  True, the sixty-two years of the Revolution is littered with initiatives created and implemented only to be reformulated or abandoned once a particular need has been achieved- a crisis averted or survived.   

Could the same operational trajectory curtail the LLC?  Yes, it could.  Is it likely?  No, it is not.  Why?  The Republic of Cuba no longer has the commercial, economic, and political elasticity to retake, and not replace, what has been given.  There are no countries today which will support the Republic of Cuba so that it might remain an “amusement park of decay” at the expense of taxpayers in another country or countries. 

Why would the government of the Republic of Cuba adopt a business structure that while rooted in the German Empire during 1892 as Gesellschaft mit beschränkter Haftung (GmbH), has for decades been widely adopted throughout the United States?

Perhaps… Because the LLC is familiar.  The LLC is explainable.  The LLC is relatable.  The LLC creates increased commonality and functionality when a company or individual subject to United States (or other country) jurisdiction is contemplating providing direct investment to and direct financing for an individual or group in the Republic of Cuba who want to start a business or who have a business and want it to grow. 

For the Biden-Harris Administration, the adoption of the LLC by the government of the Republic of Cuba provides another reason for the establishment of direct correspondent banking, the re-authorization of U-turn transactions, and an operationally efficient direct means for electronic remittance transfers to support direct investment to and direct financing for the re-emerging private sectors. Implementing each will in the near term overwhelm the financial infrastructure of the Republic of Cuba, but that consequence is nothing compared to the eventual benefit. 

Now is opportune to provide the re-emerging private sector, and the entrepreneurs who are their foundation, with the most efficient means for engagement with companies and individuals subject to United States jurisdiction. 

The government of the Republic of Cuba may not have adopted the LLC because it would send a message to the government of the United States.  However, the adoption of the LLC is a message- delivered directly or indirectly.  The message is helpful rather than an additional obstacle. 

The definitions of the LLC as outlined in the 175-pages published in the Gaceta Oficial on 19 August 2021 are not the final definitions and regulations.  They are vague in some instances.  They are contradictory in other instances.  They require clarification in other instances.  The role of individuals not subject to Republic of Cuba jurisdiction remains unresolved.  However, the definitions and regulations exist and that is important.  They didn’t on 18 August 2021.  

Salient points:  First, the process for defining the LLC was not one where the PCC was an energetic participant for an expansive result.  Second, as LLCs are created and begin to operate the regulations will evolve.  There will be pushback from some members of the PCC.  The unfolding process will be confrontational.  There will be investigations to ensure “ideological integrity” of individuals owning and managing LLCs- and this will likely be particularly acute for those with more than 100 employees.  The LLC will survive.  With support from the Biden-Harris Administration, the LLC will thrive. 

While the United States business community would prefer the government of the Republic of Cuba embrace a holistic and expansive approach for changes to the commercial and economic infrastructure, there are opportunities for engagement within the incremental model deployed currently in the Republic of Cuba. 

The last ninety days for the Republic of Cuba have, from a commercial perspective, been astonishing in swiftness and depth.  Some of what has been approved: 

• Duties and fees eliminated on certain imports

• Regulation of cryptocurrency

• Postal service to provide financial services

• Financing for purchases

• Private sector increases access to suppliers, foreign currency

• Suspension of tariffs and fees for residential solar systems

• Regulations for micro, small, and medium-size enterprises

• Adoption of the LLC as an ownership format 

Since 1 January 2021, the government of the Republic of Cuba merged its two operational currencies, the Convertible Peso (CUC- 1 to US$1.00) and the Cuban Peso (CUP- 24 to US$1.00) leaving the CUP.  The CUP remains overvalued (“street” value is 60-70 to US$1.00).  Further official devaluation is expected perhaps by the end of 2021.  There has been decentralization within the commercial sectors, though there remain opportunities for additional changes.  Expanded use by private companies of Republic of Cuba government-operated Fincimex-created American International Services (AIS) card cards issued by Republic of Cuba government-operated Banco Metropolitano.  Expanded use of Moneda Libremente Convertible (MLC) for transactions.  Republic of Cuba government-operated companies and private sector companies may retain from 80% to 100% of revenues from exports. 

Changes within the Republic of Cuba have never been about a moment, but rather a series of moments.  Commercially and economically, 19 August 2021 was an important moment- and more will come because the government of the Republic of Cuba has no other option.      

The Diaz-Canel-Valdes Mesa Administration will not collapse.  It will adapt.  As did its predecessors Raul Castro Administration (2008-2019) and Fidel Castro Administration (1959/1976-2008).  For the Biden-Harris Administration to influence the behavior of current management in the city of Havana, Republic of Cuba, it too must adapt to the realities on the ground.  

LLC Background 

From the Internal Revenue Service (IRS): “A Limited Liability Company (LLC) is a business structure allowed by state statute.  Owners of an LLC are called members. Most states do not restrict ownership, so members may include individuals, corporations, other LLCs and foreign entities. There is no maximum number of members. Most states also permit “single-member” LLCs, those having only one owner.  A few types of businesses generally cannot be LLCs, such as banks and insurance companies. Check your state’s requirements and the federal tax regulations for further information. There are special rules for foreign LLCs.  Depending on elections made by the LLC and the number of members, the IRS will treat an LLC as either a corporation, partnership, or as part of the LLC’s owner’s tax return (a “disregarded entity”). Specifically, a domestic LLC with at least two members is classified as a partnership for federal income tax purposes unless it files Form 8832 and affirmatively elects to be treated as a corporation. For income tax purposes, an LLC with only one member is treated as an entity disregarded as separate from its owner, unless it files Form 8832 and elects to be treated as a corporation. However, for purposes of employment tax and certain excise taxes, an LLC with only one member is still considered a separate entity.” 

Investopedia: A limited liability company (LLC) is a business structure in the U.S. that protects its owners from personal responsibility for its debts or liabilities. Limited liability companies are hybrid entities that combine the characteristics of a corporation with those of a partnership or sole proprietorship. 

From dummies: The limited liability company (LLC) didn’t come out of nowhere. Business entities with the same characteristics as LLCs have been around for many years. The origin of LLCs can be traced back to the Germans. In 1892, German law enacted what was called the Gesellschaft mit beschränkter Haftung (GmbH) — a modern-day variation of the English private limited company.  After Germany established the GmbH, the concept soon spread throughout Europe and Central and South America. By the 1940s, in France especially, the concept of the limited liability company was becoming more popular than the traditional corporation.  Not that Germany can take all of the credit. In 1874, Pennsylvania authorized the use of a Limited Partnership Association. By 1875, Michigan, New Jersey, Ohio, and Virginia had enacted similar legislation after seeing how the entity type was gaining popularity in Pennsylvania. Unfortunately, the laws of the time required that the company headquarters remain in one of those five states. Because those states weren’t huge epicenters of American commerce, the new legislation began to lose popularity.  In 1977, Wyoming decided to spearhead an effort to build upon the antiquated Limited Partnership Association and enacted the first true LLC act. The legislature modeled the act after the German GmbH and the successful Panama version of the LLC. Because of Wyoming, the modern-day LLC protects all partners from the liability of the business and has a double layer of liability protection that protects the business from your personal creditors.  After Wyoming, Florida followed suit in 1982. However, LLCs weren’t popular entities. Because they were hybrid entities — between a corporation and a partnership — the IRS had yet to decide how it was going to tax the LLC. After all, would you really want to form a business entity without knowing what sort of tax structure would be imposed on you?  Finally, in 1988, the IRS ruling came: LLCs would be taxed as partnerships. The business’s profits and losses would flow through to the owners, and the LLC wouldn’t be recognized as a separate entity for tax purposes. After this ruling occurred, states began to form their own versions of LLC law. 

LINK To Complete Analysis In PDF Format

LINKS To Recent Remittance-Related Analyses  

Healthcare Crisis In Cuba Provides Additional Questions And Opportunities For Biden-Harris Administration To Address Electronic Remittance Transfers... And Do So Practically August 19, 2021 

Binary: Electronic Remittance Transfer Decision For Biden Administration And Diaz-Canel Administration; And Putting US$20 Million Into Perspective August 12, 2021 

Cuba Issues 175 Pages Of Regulations For Micro, Small And Medium-Sized Enterprises (MSME's) August 20, 2021 

Defining "Transformative"- Cuba Ratifies Decree-Law Authorizing SME's: Micro (1-10 employees), Small (11-35 employees), Medium (35-100 employees). The Private Sector Has Returned. August 07, 2021 

Cuba Links Resumption Of Remittances From United States To Expanding Investment Opportunities For Cuban Residents Abroad August 06, 2021 

Cuba Expands Again Role Of Private Sector- Suppliers, Foreign Currency Access August 05, 2021 

Cuba Suspends Tariffs And Fees For Non-Commercial (SME's Next?) Solar Systems. Another Opportunity For Biden-Harris Administration To Support U.S. Exporters And Florida Companies Should Benefit. July 30, 2021 

Biden-Diaz-Canel Remittance Compromise: U.S. And Cuba Companies Suspend Transaction Fees Until 31 December 2021. Impact On 800 Publix Markets July 27, 2021 

U.S. Department Of State Memorandum: The 17 Company Members Of The CRWG- Moving Remittances And Using Remittances; Cuba Entities Need Be Part Of The Process July 26, 2021 

If A Product Costs At Least 2,500 Pesos (US$104.16), Customers In Cuba Now May Obtain Financing: Terms Are 2.5% Interest With 20% Down July 24, 2021

Biden Administration Wants To Deny Cuba's Government (Military) With Earnings- Conditional Resumption Of Product Filled Flights To Airports In Cuba Benefits Self-Employed; By-In From Congress? July 19, 2021 

Is Biden-Harris Administration Nearing Decision To Reverse Trump-Pence Administration Prohibition On Cuba Military Earning Money From Remittances? July 15, 2021 

Cuba Central Bank Authorizes Cuba's Postal Service To Provide Financial Services. Continuing Expansion For Receiving And Spending Funds Assists Private Sector August 27, 2021 

Cuba Central Bank Moving Nearer To Regulations For Cryptocurrencies- Another Signal To United States That Cuba Is Changing. Private Sectors Are Expanding- Though Government Remains Reluctant August 27, 2021

White House Press Secretary References Issues With Providing COVID-19 Vaccines To Cuba

The White House
Washington DC
27 August 2021

Briefing by Press Secretary Jen Psaki

Q Understood. And can I ask about -- the U.S. has donated over 3 million COVID vaccines to Afghanistan. The U.N. put out a report this week saying that the number of vaccinations in Afghanistan has significantly dropped since the Taliban took over. Does the White House or does the U.S. government have any indication of what’s happened to those vaccines? Are they in the hands of the Taliban, and are they still being distributed? Or is there a concern that the Taliban might try to sell those doses?

MS. PSAKI: Well, we have not worked with the Taliban as a -- as the government. Right? And a lot of these assistance is often distributed through humanitarian organizations or others who work through COVAX. I would have to check and see what the implementation and mechanisms are, but we are quite careful and very focused on vaccines not -- getting into the right hands. And for individual -- for countries we work with -- and remember, this was an issue with Cuba, right? -- we need to have mechanisms to ensure that they are getting out to the populations who need to get access to the vaccines.

Cuba Central Bank Authorizes Cuba's Postal Service To Provide Financial Services. Continuing Expansion For Receiving And Spending Funds Assists Private Sector

From CUBA STANDARD (8/27/21)- In an apparent response to the U.S. blacklisting of Fincimex — the Cuban counterpart of U.S. remittance companies — and of Banco Financiero Internacional (BFI), the Central Bank empowered Cuba’s postal system to provide financial services.

With Resolution 208, published Aug. 26 in the Gaceta Oficial, the central bank authorizes Grupo Empresarial Correos de Cuba to “act as a non-financial support entity for financial institutions on national territory”. The postal service will now be able to receive international bank transfers and money orders and deposit them in consumers’ hard-currency bank accounts in Cuba. Consumers will now be able to use post offices to effect transactions with magnetic cards connected to those accounts and make deposits and cash withdrawals in Cuban pesos.

LINK To Gaceta Oficial Resolucion 208 Banco Central de Cuba (8/26/21)

Recent Remittance-Related Analyses  

Healthcare Crisis In Cuba Provides Additional Questions And Opportunities For Biden-Harris Administration To Address Electronic Remittance Transfers... And Do So Practically August 19, 2021

Binary: Electronic Remittance Transfer Decision For Biden Administration And Diaz-Canel Administration; And Putting US$20 Million Into Perspective August 12, 2021

Cuba Issues 175 Pages Of Regulations For Micro, Small And Medium-Sized Enterprises (MSME's) August 20, 2021

Defining "Transformative"- Cuba Ratifies Decree-Law Authorizing SME's: Micro (1-10 employees), Small (11-35 employees), Medium (35-100 employees). The Private Sector Has Returned. August 07, 2021

Cuba Links Resumption Of Remittances From United States To Expanding Investment Opportunities For Cuban Residents Abroad August 06, 2021

Cuba Expands Again Role Of Private Sector- Suppliers, Foreign Currency Access August 05, 2021

Cuba Suspends Tariffs And Fees For Non-Commercial (SME's Next?) Solar Systems. Another Opportunity For Biden-Harris Administration To Support U.S. Exporters And Florida Companies Should Benefit. July 30, 2021

Biden-Diaz-Canel Remittance Compromise: U.S. And Cuba Companies Suspend Transaction Fees Until 31 December 2021. Impact On 800 Publix Markets July 27, 2021

U.S. Department Of State Memorandum: The 17 Company Members Of The CRWG- Moving Remittances And Using Remittances; Cuba Entities Need Be Part Of The Process July 26, 2021

If A Product Costs At Least 2,500 Pesos (US$104.16), Customers In Cuba Now May Obtain Financing: Terms Are 2.5% Interest With 20% Down July 24, 2021

Biden Administration Wants To Deny Cuba's Government (Military) With Earnings- Conditional Resumption Of Product Filled Flights To Airports In Cuba Benefits Self-Employed; By-In From Congress? July 19, 2021

Is Biden-Harris Administration Nearing Decision To Reverse Trump-Pence Administration Prohibition On Cuba Military Earning Money From Remittances? July 15, 2021

Cuba Central Bank Authorizes Cuba's Postal Service To Provide Financial Services. Continuing Expansion For Receiving And Spending Funds Assists Private Sector Aug 27, 2021

Cuba Central Bank Moving Nearer To Regulations For Cryptocurrencies- Another Signal To United States That Cuba Is Changing. Private Sectors Are Expanding- Though Government Remains Reluctant August 27, 2021

Cuba Central Bank Moving Nearer To Regulations For Cryptocurrencies- Another Signal To United States That Cuba Is Changing. Private Sectors Are Expanding- Though Government Remains Reluctant

LINK To Gaceta Oficial Resolution 215 (26 August 2021)

From Bitcoin Magazine (8/27/21) excerpts

On Thursday Cuba’s government said it would “recognize and regulate” Bitcoin and other cryptocurrencies for payments on the island, Bloomberg reported.  The local Cuban Official Gazette has published a resolution which stated that the central bank will create rules for Bitcoin and other crypto assets to determine licensing laws for providers of crypto services on the island. 

The resolution stated the central bank has power to authorize the use of Bitcoin and other crypto for “reasons of socio-economic interest,” according to the report. The resolution also said the state will act as a check over the bank’s operations, preventing the use of Bitcoin for “illegal activities”. 

Because of tough embargo rules in Cuba it has become difficult to use dollars, and as a result the popularity of Bitcoin has grown among Cuba’s technologically savvy.  A local programmer told Bloomberg that some Cubans are already using crypto in tandem with gift cards to make online purchases.  The announcement comes just 10 days before El Salvador is to become the first country to make Bitcoin legal currency as a way to remove the fees and dangers of sending cash remittances, a staple of both economies. 

It remains unknown how the central bank of Cuba will choose to regulate Bitcoin, as the only real controls it can put on the permissionless, immutable, unstoppable currency are through regulating exchanges and making it more difficult, though not impossible, for citizens to get access to its common on ramps and off ramps.  Bitcoin regulation may come as a result of the government’s realization that people are using the currency to evade U.S. restrictions on sending money to Cuba.  

From CUBA STANDARD (8/27/21) excerpts 

Resolution 215, published Aug. 26 in the Gaceta Oficial, sets the norms how the central bank will regulate cyber currencies, and states that the central bank will license commercial providers, but spells out few details.  “It will be important for the government to regulate and maintain sovereignty over the financial system”, said Eduardo Sánchez, a Cuban blockchain expert. “The Cuban context shares the same risk with any other crypto markets in the world — the volatility, security, capital flight, financing for criminal activities.” 

The official recognition of cyber currencies follows a boomlet in Cuba prompted by the U.S. government’s shutdown of most legal channels for U.S.-Cuba remittances in late 2019.  A more aggressive U.S. sanctions regime against Cuba in recent years has led international banks and companies to avoid transactions involving the island, and prompted remittance giant Western Union to pull out of Cuba. And most recently, travel restrictions imposed in response to the COVID-19 pandemic have been affecting informal remittance channels.  In September 2019, the Central Bank – together with the University of Havana – began to study whether the country should introduce its own cryptocurrency, following the lead of Venezuela. There has been no announcement whether the partners have come to any conclusion. 

The central bank resolution is a far cry from an enthusiastic embrace. Showing official Cuba’s skepticism regarding the soundness of cyber currencies, the resolution says the central bank will warn consumers about the risks of virtual money. In a final disclaimer, the text clarifies that “natural persons assume the risks and responsibilities … of operating with virtual assets and virtual asset service providers that function at the margins of the banking and financial system, even if virtual-asset transactions between said persons are not prohibited”. 

State banks and enterprises will only be allowed to use cyber currencies with the express permission of the central bank.  The new rule clarifies that all cyber currency service providers will have to seek a license from the central bank. The resolution defines as cyber currency service providers “any natural or judicial person that as business or business activity dedicates itself to the exchange between virtual assets and legal currencies; the exchange between one or more forms of virtual assets; the transfer of virtual assets; the custody or administration of virtual assets or instruments that allow control over virtual assets; and the participation in the provision of financial services related to the offer of an emission or sale of a virtual asset”. 

In Cuba, a tech-savvy younger generation has increasingly adopted cyber currencies, thanks to the spread of mobile Internet use, and due to a weak local currency that makes it harder to get dollars, and U.S. sanctions complicating money transfers. Crypto currencies offer a parallel financial infrastructure, allowing users to bypass the U.S.-controlled SWIFT messaging service that banks use to communicate payment instructions. 

A fairly high percentage of Cubans seem to have become familiar with — or even use — crypto currency. Cubans have used virtual currencies to get paid for jobs, receive remittances from the United States, and to invest in crypto assets. Along the way, Cuba has joined the world’s most active markets with crypto currency. According to Fintech Times, Cuba in late 2020 was the No. 1 country for crypto inquiries as a percentage of all inquiries on TradingView, a platform that keeps tabs on stocks, bonds, regular currencies and cryptocurrencies. 

Qbita, a bitcoin exchange platform launched in 2019, leads the field of virtual currency service providers in Cuba, with 13,000 users and a volume of US$354,771 in transactions in 2020. Qbita facilitates the exchange between bitcoin and Cuban pesos, US dollars, and other cryptocurrencies. Other startups, such as Fusyona and Bitremesas, and more recently QvaPay, are not only transmitting remittances, but provide business solutions to Cuban entrepreneurs through the use of crypto assets. 

Investment platforms such as Trust Investing and QubitTech manage crypto assets and offer investment plans to Cubans. Tulip Research, a financial forensics firm focusing on blockchain, defined both as Ponzi schemes, and the national exchange commissions of Spain and Panama issued a warning in 2020 against Trust Investing. But that has so far not stopped their rising popularity in Cuba.  Meanwhile, crypto mining — the “production” of virtual money — is difficult to do in Cuba. Unlike in oil-rich countries such as Iran or Venezuela, where government subsidies lower the cost of electricity needed for computers to process cryptocurrencies, Cuban “miners” face material limitations. 

Says Eduardo Sánchez: “There could be an entrepreneurship boom connected to crypto assets in the next couple of years in Cuba. There is potential and talent for that. But it all depends on the relationship with the U.S. and the success of domestic reforms.” 

Recently, the U.S. Treasury has been catching up, in what seems to be a systematic crackdown against U.S. companies engaging in cryptocurrency transactions involving sanctioned countries.  In late December, the Office of Foreign Assets Control (OFAC) fined BitGo, a Palo Alto, Cal.-based crypto wallet and custodian, for allowing users from Ukraine, Cuba, Iran, Sudan and Syria to access its crypto wallet. Six weeks later, OFAC announced it fined BitPay Inc., after it alleged that consumers in sanctioned countries had used the Atlanta-based company’s cybercurrency merchant payment solution. Both companies settled the allegations by paying a fine and agreeing to block customers in sanctioned countries. OFAC has also added individuals and hosts of cryptocurrency addresses, such as Zcash and Dash, to the Specially Designated Nationals (SDN) list, over crimes ranging from wire fraud to election interference.

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Healthcare Crisis In Cuba Provides Additional Questions And Opportunities For Biden-Harris Administration To Address Electronic Remittance Transfers... And Do So Practically August 19, 2021

Binary: Electronic Remittance Transfer Decision For Biden Administration And Diaz-Canel Administration; And Putting US$20 Million Into Perspective August 12, 2021

Cuba Issues 175 Pages Of Regulations For Micro, Small And Medium-Sized Enterprises (MSME's) August 20, 2021

Defining "Transformative"- Cuba Ratifies Decree-Law Authorizing SME's: Micro (1-10 employees), Small (11-35 employees), Medium (35-100 employees). The Private Sector Has Returned. August 07, 2021

Cuba Links Resumption Of Remittances From United States To Expanding Investment Opportunities For Cuban Residents Abroad August 06, 2021

Cuba Expands Again Role Of Private Sector- Suppliers, Foreign Currency Access August 05, 2021

Cuba Suspends Tariffs And Fees For Non-Commercial (SME's Next?) Solar Systems. Another Opportunity For Biden-Harris Administration To Support U.S. Exporters And Florida Companies Should Benefit. July 30, 2021

Biden-Diaz-Canel Remittance Compromise: U.S. And Cuba Companies Suspend Transaction Fees Until 31 December 2021. Impact On 800 Publix Markets July 27, 2021

U.S. Department Of State Memorandum: The 17 Company Members Of The CRWG- Moving Remittances And Using Remittances; Cuba Entities Need Be Part Of The Process July 26, 2021

If A Product Costs At Least 2,500 Pesos (US$104.16), Customers In Cuba Now May Obtain Financing: Terms Are 2.5% Interest With 20% Down July 24, 2021

Biden Administration Wants To Deny Cuba's Government (Military) With Earnings- Conditional Resumption Of Product Filled Flights To Airports In Cuba Benefits Self-Employed; By-In From Congress? July 19, 2021

Is Biden-Harris Administration Nearing Decision To Reverse Trump-Pence Administration Prohibition On Cuba Military Earning Money From Remittances? July 15, 2021

Cuba Central Bank Authorizes Cuba's Postal Service To Provide Financial Services. Continuing Expansion For Receiving And Spending Funds Assists Private Sector Aug 27, 2021

Cuba Central Bank Moving Nearer To Regulations For Cryptocurrencies- Another Signal To United States That Cuba Is Changing. Private Sectors Are Expanding- Though Government Remains Reluctant August 27, 2021

Goldwind Turbine Of China Libertad Act Lawsuit Dismissed (In Part) By Court, But Plaintiffs May Refile- And Likely Will- Court Confirmed They Have Standing

NORTH AMERICAN SUGAR INDUSTRIES INC., V. XINJIANG GOLDWIND SCIENCE & TECHNOLOGY CO., LTD., GOLDWIND INTERNATIONAL HOLDINGS (HK) LTD., DSV AIR & SEA INC., BBC CHARTERING USA, LLC, and BBC CHARTERING SINGAPORE PTE LTD., [1:20-cv-22471; Southern Florida District].

Gibson, Dunn & Crutcher (plaintiff)
Mandel & Mandel (plaintiff)
Morgan, Lewis & Bochius (defendant)
Akerman (defendant)
Hogan Lovells LLP (defendant)

LINK To Order (8/24/21)

LINK To Libertad Act Lawsuit Filing Statistics

Excerpts:

The Cuban government is constructing a large-scale wind power project (the “Project”) located in the Cuban province of Las Tunas, about 15 miles from Puerto Carupano. [ECF No. 1 ¶ 82].2 The Project will house 54 wind turbines and is expected to significantly increase Cuba’s renewable energy capacity. Id. at ¶ 85. Equipment for the Project is imported through Puerto Carupano. Id. at ¶ 82.

Goldwind International contracted with Cuba’s Ministry of Energy and Mining to supply the Project with wind turbines and other equipment. Id. at ¶ 88. Goldwind International and Goldwind Science worked with shipping carriers DSV, BBC USA, and BBC Singapore to transport equipment to Cuba for the Project.

In their Motion, Defendants allege that on April 1, 2019, Plaintiff, Plaintiff’s parent companies, and thirteen additional co-debtors (collectively, the “Hexion Debtors”) filed voluntary petitions for relief under Chapter 11 of Title 11 of the United States Code, 11 U.S.C. §§ 101, et seq. (the “Bankruptcy Proceeding”). [ECF No. 54].4 According to Defendants, Plaintiff did not mention the Certified Claim or any Act related claims in its filings for the Bankruptcy Proceeding. Id. On June 25, 2019, the bankruptcy court confirmed the Hexion Debtors’ Reorganization Plan, which became effective on July 1, 2019.

Defendants argue that Plaintiff’s failure to disclose its Certified Claim or Act-related claims in the Bankruptcy Proceeding bars this action. The Court finds that it is premature to address these issues.

As set forth in detail above, Plaintiff has adequately alleged standing under Article III of the constitution to bring these claims.

Though Plaintiff has adequately alleged Article III standing, the Complaint must be dismissed as a shotgun pleading.

Here, the Complaint improperly incorporates all the factual allegations into each count, without properly tying each of those factual allegations to the claims raised. See Innova Inv. Grp., LLC v. Village of Key Biscayne, No. 19-CIV-22540, 2020 WL 6781821, at *5 (S.D. Fla. Nov. 18, 2020). In addition, each count adopts the allegations of all preceding counts. Weiland, 792 F.3d at 1321. As a result of these pleading deficiencies, the Court is unable to ascertain which facts support which claims and whether Plaintiff has stated any claims upon which relief can be granted. Therefore, the Complaint shall be dismissed without prejudice.

Based on the foregoing, it is ORDERED AND ADJUDGED as follows: 1. Defendants’ Motion to Dismiss Complaint, [ECF No. 54], is GRANTED in PART. The Complaint is dismissed without prejudice. 2. Defendants’ Motions to Dismiss for Lack of Personal Jurisdiction, [ECF Nos. 48, 52, 53, & 107], are DENIED as MOOT as there is no longer an operative complaint. Defendants may refile their respective motions based on lack of personal jurisdiction, supplemented by the facts obtained during jurisdictional discovery, upon the filing of an amended complaint.

Cuba Continues Progress From Analog Television To Digital Television

Advanced Television
East Sussex, United Kingdom
27 July 2021

Cuba delays full digital TV until 2024
By Chris Forrester

Cuba has delayed its digital switchover. Cuba’s deputy minister of communications, Ana Julia Marine Lopez, confirmed in an interview with a local newspaper that the nation has put off a complete switch to DTT until 2024. She blamed the delay on costs and the ongoing financial problems the nation is facing. According to Marine Lopez, Cuba’s government has approved the financing that allowed to boost the production of set-top boxes and is expected to deliver 318,000 units this year. From 2013 to today Cuba has sold 2.7 million DTT STBs. However, some progress is being made; The first switch-over to DTT will start later this year in Cuba’s western provinces, followed in 2022 in the region from Villa Clara to Camagüey. The final phase, she said, would take place in 2023 in the eastern portion of the nation.

Xinhua News Agency
Beijing, China
24 May 2021

China supports development of Cuba's digital TV platform
By Yosley Carrero

HAVANA, May 23 (Xinhua) -- Lazaro Campos, who works as a supervisor at Havana-based Camilo Cienfuegos electronics company, has changed his daily routine over the past few weeks as the island started manufacturing set-top boxes to meet local demand."Cuba is moving from analog (TV) to digital TV. That is why we want to make sure people get access to the necessary equipment," he said. Campos told Xinhua that components used in the production process were imported from China, which is the island's second largest commercial partner and a main technical assistance provider. "We have received training from Chinese experts who have very much contributed to improving the quality of our work," he added.So far, technicians from the Cuban electronics company have already manufactured 90,000 of the 318,000 converter boxes expected to be produced by the end of the year. In parallel, over 32,000 TV sets will be manufactured by the company in 2021 to supply the country's stores as well as to support Cuba's education and tourism industries.Sitting on a black chair, Nayta Perez checked the quality of sound and image of 32-inch and 43-inch hybrid TV sets before they were packaged and sent to a warehouse. "It is a very time-consuming process, but very important," she said. "We have to guarantee the product meets all the requirements for people to have a comfortable digital TV viewing experience at home."The state-run electronic company is also boosting innovation and research on digital TV at a laboratory donated by China. "We have gained some expertise with analog TV, but the digital era has changed almost everything," said 48-year-old Camilo Varona, who has been working in the company since 1994. "China and Cuba have built a win-win relationship."Digital television rollout in the Caribbean country kicked off in 2013, with converter boxes donated by the Chinese government being part of the first test in the capital city of Havana. At present, more than 40 municipal, provincial and national TV channels in Cuba broadcast via analog and digital signals. According to local media, new digital television transmitters would be spotted at various corners of the country this year.Edel Gomez, director of the electronics company, told Xinhua that Cuba uses renewable energy sources and environmentally friendly technologies to produce set-top boxes and hybrid TV sets. "The outcome of joint work between Chinese companies and Cuba has been very positive. The digital TV with Chinese standards has shown its high quality of signal reception, sound, and image resolution," he said. "Things are going well."

Advanced Television
East Sussex, United Kingdom
28 May 2013

Cuba to start DTT in June
By Chris Forrester

Cuba will start testing its Chinese version of digital terrestrial TV in June, Cuba has adopted China’s Digital Terrestrial Multimedia Broadcast standard (DTMB) and will start testing in “real conditions” around Havana, the capital. As part of the tests the Communications Ministry will be distributing set-top box decoders to various neighbourhoods to ensure adequate transmissions are being made. The Chinese government has donated much of the equipment needed. The test receiver boxes can be bought be residents at a price 7.35 Cuban Pesos (about US 33 cents) probably the lowest cost – to consumers – of a box anywhere on the planet.

Advanced Television
East Sussex, United Kingdom
22 March 2013

Cuba adopts Chinese TV standard
By Chris Forrester

It may not be the largest TV market on the planet but China must be pleased that it will be providing equipment for Cuba’s adoption of digital terrestrial TV, just 90 miles from the Florida coast. China’s DTMB standard (Digital Terrestrial Multimedia Broadcast) is used throughout China, Hong Kong, Macau and Laos. Other countries using it, although often in trial modes only, include Iraq, Jordan, Syria and Lebanon. The advantages are that the system permits reception by handheld devices, and embraces HD, standard definition digital and delivery to multimedia devices.

Cuba Issues 175 Pages Of Regulations For Micro, Small And Medium-Sized Enterprises (MSME's)

Radio Cadena Agramonte
Camaguey, Republic of Cuba
20 August 2021

Regulations on small and medium-sized enterprises in Cuba are published

Havana, Aug 20.- Cuba today issued regulations related to the activities that micro, small and medium-sized private companies, non-agricultural cooperatives, and self-employed workers can carry out. 

The Official Gazette publishes Decree-Law 46 signed by the president of the National Assembly of People's Power, Juan Esteban Lazo Hernández, this Thursday , its purpose is to regulate the creation and operation of micro, small and medium-sized enterprises (MIPYMES).  

The legal norm highlights that MSMEs are those economic units with legal personality, which have their own dimensions and characteristics, and whose purpose is to develop the production of goods and the provision of services that meet the needs of society. These can be state, private or mixed property, and are classified depending on the number of employed persons as: Micro enterprise, whose range of employed is from one to 10 persons; Small business, from 11 to 35, and Medium business, from 36 to 100 people. 

Stresses that MSMEs have business autonomy; they contract goods and services with the other subjects recognized in the current legislation with equal conditions, and provide statistical information as provided by law. In addition, they can export and import in accordance with the provisions of current legislation; manage and administer your assets; define the products and services to be marketed, as well as their suppliers, clients, destinations and market insertion; operate bank accounts and access any lawful source of financing; set the prices of its services and goods except those that are centrally approved. 

Define its structure, staff and number of workers; determine the income of its workers respecting the established minimum wages; make the investments required for the development of the MIPYME; create establishments that do not have legal personality, inside or outside the province where their registered office is located; and another faculty or right that derives from its condition of company, as long as it does not oppose what is legally established. Regarding the activities to be carried out by micro, small and medium-sized private companies, non-agricultural cooperatives and self-employed workers, Decree 49 states, which are those considered legal, except those that are regulated in the list of unauthorized activities, annexed to that regulation.   

Unauthorized activities include pest control, except domestic pest control; ordinary hunting and trapping for commercial purposes, and mining and quarrying. Within the manufacturing industry, the production of sugar, natural mineral waters and tobacco is not authorized; the printing of newspapers, magazines, tabloids, books, maps, atlases, postage stamps, tax stamps, title documents, checks and other guarantee documents, except for products associated with the promotion of commercial activity. Manufacture of arms and ammunition; of military insignia; of cells, batteries and accumulators; of motor vehicles; of ships, floating structures, recreational and sports boats, as well as other boats; as well as repair and maintenance of firearms and ammunition, among others. 

The creation of record labels, music publishers and entities for the commercialization of records and other phonographic supports are not authorized, except for the activities of recording and post-production of sound and licenses for record sellers already approved; radio transmissions; television programming and broadcasts, on the cultural programming of music, performing arts, books, plastic arts, cinema, heritage and community cultural work; as well as wireline, wireless and satellite telecommunications activities that include the public internet access service. The annex to the regulations also includes other unauthorized activities in activities of extraterritorial organizations and bodies; of services; artistic, entertainment and recreational; human health care and social assistance; teaching; real estate; professional, scientific and technical; as well as administrative and support services, among others. (Text and infographic: ACN) 

LINK To Gaceta Oficial Document (175 Pages In Spanish)

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Binary: Electronic Remittance Transfer Decision For Biden Administration And Diaz-Canel Administration; And Putting US$20 Million Into Perspective August 12, 2021

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DHS Secretary Mayorkas Visits Florida. Refuses To Answer Question Could Signal Biden Administration Considering Cuba Military Participation In Remittance Delivery

The Honorable Alejandro Mayorkas was sworn in as Secretary of the Department of Homeland Security (DHS) by President Joe Biden on February 2, 2021. Secretary Mayorkas is of Cuban descent.

Politico
Arlington, Virginia
19 August 2021

Excerpts: “Mayorkas was tight-lipped with reporters about the future of U.S.-Cuba policy. Asked why Biden’s policies so far looked less like those of President Obama, Biden's former boss when he was vice president, and more like the Trump policies that Biden had once pledged to scale back, Mayorkas wouldn’t say. "The Biden-Harris administration will develop its policy toward Cuba in support of the Cuban people with the Cuban-American community," he replied. Biden's Homeland Security secretary also said he would not comment on whether he supports efforts to prevent money from flowing directly or indirectly to the Cuban military, which controls the island’s economy — the heart of Trump’s Cuba policy.”

Remittance Background

Electronic remittance transfers arriving to the Republic of Cuba are processed by, delivered through, and create benefit for the government of the Republic of Cuba primarily through Revolutionary Armed Forces (FAR) of the Republic of Cuba-connected Grupo de Administración Empresarial S.A. (GAESA) which controls Republic of Cuba government-operated Banco Financiero Internacional S.A. (BFI), Republic of Cuba government-operated Financiera Cimex (Fincimex) and Republic of Cuba government-operated American International Services (AIS).    

Perhaps, the Biden-Harris Administration (2021- ) is considering solely for the processing and delivery of electronic remittance transfers to authorize BFI, Fincimex, and AIS which are on the Cuba Restricted List (CRL) maintained by the United States Department of State. And limiting the percentage the three entities may collectively receive (currently less than 2% combined which is in line with global marketplace norms) and using direct correspondent banking to make the transactions direct rather than through third countries thus ensuring greater transparency. The Cuba Remittance Working Group (CRWG) is to deliver its recommendation(s) to The White House by 29 August 2021.

Twitter Feed From DHS

Secretary Alejandro Mayorkas @SecMayorkas Meeting with the Haitian American community in Miami again today, I expressed the Biden-Harris Administration’s steadfast commitment to ensuring the safety and well-being of Haitians as the country faces one tragedy after another.

Today in Miami, @SecMayorkas is joined by Juan Gonzalez, @WHNSC Sr. Director for the Western Hemisphere, and Mark Feierstein, Principal Advisor to @PowerUSAID, for engagements with the Cuban American and Haitian American communities.

The Biden Administration stands in solidarity with the Cuban people and their call for freedom. I join @POTUS in our commitment to holding the Cuban regime accountable, supporting the Cuban people, and ensuring Cuban Americans remain a vital partner in our efforts.

Secretary Alejandro Mayorkas @SecMayorkas I am on my way to Miami, where I will meet with both the Cuban American and Haitian American communities. I will also have the chance to pay my respects to the #Surfside victims, and thank dedicated Miami-Dade first responders.

The White House
Washington DC
28 January 2021

Press Briefing by Press Secretary Jen Psaki

”Q And if I may ask one more on Cuba: Do you guys plan on starting -- walking back all of those restrictions that were put into place under the Trump administration after the Obama administration had opened things up with Cuba?”

”MS. PSAKI: Well, our Cuba policy is governed by two principles. First, support for democracy and human rights. That will be at the core of our efforts. Second is Americans, especially Cuban Americans, are the best ambassadors for freedom in Cuba. So we'll review the Trump administration policies, as we are in a number of other areas of national security, with an eye to assure -- ensuring that our approach is aligned with that. But, you know, we will take our own path. I don't I don't have anything to predict for you at this point in time.”

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American Airlines Survives: Judge Quotes John Adams. Libertad Act Lawsuit Dismissed- Plaintiff Has Standing, But Inheritance Came Too Late. Aug 3, 2021

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Miami Herald: "Feds seized $2.7 million in cash from Florida travelers. There’s just one reason why" And Much Going To Cuba

Miami Herald
Miami, Florida
19 August 2021

Feds seized $2.7 million in cash from Florida travelers. There’s just one reason why

By Ariana Aspuru and Jay Weaver

Last year, $2.7 million in bulk cash was seized at Florida airports and ports. That’s a big uptick from 2020 federal seizures of $2 million in Florida, according to U.S. Customs and Border Protection.  

Before boarding his flight in May from Fort Lauderdale to Panama, Lisandro Cadenas claimed he was only traveling with $3,000.  U.S. Customs and Border Protection officers asked him both in English and Spanish to confirm how much money he was carrying, according to court documents. Again, Cadenas said $3,000. 

When the customs officers searched his belongings, however, they found bundles of cash stashed in multiple places, including the front pocket of his jeans and in a handkerchief of a man’s purse. When the officers finished searching Cadenas, a lawful U.S. resident of Cuban descent, they counted more than $29,000 on him, according to a criminal complaint and affidavit. Cadenas, who faces federal trial at the end of August on charges of bulk-cash smuggling and making a false statement, lost all his money because he was required to declare it under U.S. law.  

Customs officers seized his cash — a haul that added to more than $2.7 million that was confiscated from U.S. and foreign travelers who didn’t legally declare the money at Florida airports and ports this fiscal year, which ends next month. That’s a big uptick from 2020 federal seizures of $2 million in Florida, according to U.S. Customs and Border Protection. 

Federal law states that travelers can bring as much money as they want when they travel in or out of the country, but they need to declare anything over $10,000 to U.S. Customs and Border Protection. Travelers who fail to declare their funds risk getting the money taken away by customs officers — but the seizure statistics suggest more people still try to slip big wads of cash past federal agents.  

In March, a Cuban couple was stopped at Miami International Airport by customs officers before boarding a Swift Air flight to Cuba.  Miguel Angel Del Rosario and Rachel De La Caridad Garcia declared they were carrying $8,000 in cash on the trip, but then only produced $5,104 when asked to show the funds in their two suitcases and two carry-on bags, according to a criminal complaint and affidavit. The customs officers searched their luggage and found a total of $105,469 hidden in their clothes. The couple’s money was seized, and they pleaded guilty to bulk-cash smuggling in June. They face sentencing in September. 

In Florida, Miami International Airport, recognized as a hub for cash, contraband and drug smuggling, ranks among the top five in the United States for federal seizures of money from travelers who don’t legally declare it — a sum totaling $91.5 million at MIA between 2000 and 2016, according to a report by the Institute for Justice, a Virginia-based law firm that specializes in efforts to recover civil forfeitures by the government.

The airport seizure report, based on statistics from a Treasury Department’s forfeiture database, focuses on travelers whose money was taken by Customs and Border Protection officers. Their typical crime: a failure to file required paperwork, FinCEN Form 105, declaring more than $10,000 in cash upon entering or leaving the country. 

The report — titled “Jetway Robbery? Homeland Security and Cash Seizures at Airports” — says that customs officers seized $2 billion in more than 30,000 seizures at U.S. airports over a 17-year period. A big chunk of that total, $500 million, was confiscated only because American and foreign travelers failed to declare more than $10,000 in cash — not because the seizure was connected to serious criminal activity.

In response to the report’s findings, U.S. Customs and Border Protection said travelers must obey the cash reporting law and the agency must enforce it. The only two expectations that CBP has of travelers is that they truthfully report all currency that they possess to a CBP officer, and that they complete a U.S. Treasury Department form (FINCEN 105) for all currency and other monetary instruments that exceed $10,000, the agency said. 

“The disregard that some travelers have for our nation’s currency reporting laws is a concern and very unwise, especially when you consider travelers can keep their currency simply by just being honest and declaring the full amount to a Customs and Border Protection officer,” said Zach Mann, an agency spokesman in South Florida. 

“CBP’s mission is to protect our nation, its citizens, residents and economy from criminal and terrorist activity,” Mann said. “As an agency, and as individual officers, we want to spend our time effectively and efficiently going after those with bad intentions. Part of the equation for all of our success is informed compliance by the traveler. When travelers know the law and comply then CBP can better focus on the bad guys.”  

Cadenas’ encounter with customs officers at Fort Lauderdale’s airport is a case in point. When pressed about why he was traveling with more than $29,000 in cash, Cadenas said he was planning to board a connecting flight from Panama to Cuba and then buy a car on the island, according to court records. But he also confessed that some of the money was part of a business arrangement where he and his wife transfer money from the U.S. to Cuba, records show. He said he only declared $3,000 to customs officers in Fort Lauderdale because he was worried about Cuban officials taking his cash.  Instead, the U.S. government seized because agents said he didn’t declare the full total.  

One month before the feds seized Cadenas’ cash, Quashad Peterson Taylor lost a massive amount of money to customs officials at Fort Lauderdale Executive Airport as his chartered flight was about to leave for the Bahamas.  Customs and Border Patrol and Homeland Security Investigations inspected the plane from Tropical Air Charters Inc. Taylor was a passenger with two crew members who all shook their heads when investigators asked if they had more than $10,000 in their possession, according to a criminal complaint and affidavit. Taylor said he only had $100 in a gray backpack in the cargo area.  Records indicated that Taylor was also suspected of traveling with bulk cash in 2018.  This time, officers searched the plane and found three large plastic bins filled with wrapped bundles of cash, rubber bands and empty money storage bags, according to the affidavit. More money was also found in Taylor’s fanny pack. 

After the search of the plane in April, Taylor filled out a currency reporting form and wrote how he was transporting more than $1,000,000 on the flight to the Bahamas. He claimed all the money belonged to him, according to the criminal affidavit. Customs officers seized the money, which will be forfeited at his upcoming sentencing and turned over to the U.S. government.  Taylor pleaded guilty to bulk cash smuggling last month and will face sentencing in mid-October, said his lawyer, Nayib Hassan. He declined to comment about the case. 

Relevant Analyses 

If Western Union Ends Remittance Services To Cuba, That Means A Return Of “Mules On Steroids”- The Impact Could Cripple MIA November 16, 2020

Western Union Data For Transfers To Cuba: 2.88 Million Annually- 24% To Havana; Florida 1st, Texas 2nd, New Jersey 3rd; US$200,000+ Could Be Aboard Each Flight From Miami November 19, 2020

Will United States Airlines Now Post A Link To FinCEN Form 105 On Their Internet Sites For Passengers Traveling To Cuba? November 23, 2020

Binary: Electronic Remittance Transfer Decision For Biden Administration And Diaz-Canel Administration; And Putting US$20 Million Into Perspective Aug 12, 2021

Healthcare Crisis In Cuba Provides Additional Questions And Opportunities For Biden-Harris Administration To Address Electronic Remittance Transfers... And Do So Practically Aug 19, 2021

Biden-Harris Administration Confirms Cuba "Remittance Working Group" Has No Private Sector Members Aug 12, 2021

Cuba Purchases Of U.S. Agricultural Commodity/Food Products Increase 94.4% Year-To-Year; June 2021 Increased 413% Compared To June 2020 Aug 8, 2021

Defining "Transformative"- Cuba Ratifies Decree-Law Authorizing SME's: Micro (1-10 employees), Small (11-35 employees), Medium (35-100 employees). The Private Sector Has Returned. Aug 7, 2021

Cuba Links Resumption Of Remittances From United States To Expanding Investment Opportunities For Cuban Residents Abroad Aug 6, 2021

Cuba Expands Again Role Of Private Sector- Suppliers, Foreign Currency Access Aug 5, 2021

European Union Member France's CMA CGM S.A. Is 41st Company Sued Using Libertad Act- Shipping To Cuba Through Jamaica And Using Port Mariel Aug 3, 2021

American Airlines Survives: Judge Quotes John Adams. Libertad Act Lawsuit Dismissed- Plaintiff Has Standing, But Inheritance Came Too Late. Aug 3, 2021

Judge In Libertad Act Lawsuit Against Seaboard Marine Dismisses 17 Plaintiffs; Remaining Plaintiff Wins Rulings- They Own The Property. Seaboard Trafficked And Knew It Was Trafficking. Settlement? Jul 31, 2021

President Biden Meets With Individuals Of Cuban Descent To Discuss Policy And Regulatory Options; Background Call Provides Details; White House Press Briefing Mentions Cuba Jul 30, 2021

U.S. Secretary Of State Speaks With Foreign Ministers Of Mexico And Spain. Cuba Does Not Come Up For Mexico Given Acts By Mexico's President? And Spain Does Not Confirm Cuba Was Discussed. Jul 30, 2021

Cuba Suspends Tariffs And Fees For Non-Commercial (SME's Next?) Solar Systems. Another Opportunity For Biden-Harris Administration To Support U.S. Exporters And Florida Companies Should Benefit. Jul 30, 2021

Healthcare Crisis In Cuba Provides Additional Questions And Opportunities For Biden-Harris Administration To Address Electronic Remittance Transfers... And Do So Practically

The partial collapse of the Republic of Cuba government-operated healthcare system managed by the Diaz-Canel-Valdes Mesa Administration (2019- ) has provided additional questions and additional opportunities for the Biden-Harris Administration (2021- ).  Can citizen anger be managed? 

• First, how to craft an electronic remittance transfer regulatory and policy construct which is perceived in the United States (specifically from some members of the 117th United States Congress and to populations residing in certain areas of the State of Florida) as “helping to rescue” the 11.3 million citizens of the Republic of Cuba while not perceived as “helping to rescue” the government of the Republic of Cuba. 

• Second, how to craft an electronic remittance transfer regulatory and policy construct whereby Republic of Cuba nationals direct responsibility toward the government of the Republic of Cuba for commercial, economic, and political inadequacies rather than toward the government of the United States. 

• Third, opportunities exist that were absent two months ago for the Biden-Harris Administration to further lessen the dependency of Republic of Cuba nationals upon the government of the Republic of Cuba.  One of these opportunities is through the implementation of a regulatory and policy construct to authorize direct investment to and direct financing for the re-emerging private sectors in the Republic of Cuba, which are fragile and subject to internal and external disruption.  They require nurturing.  They require resources.  They require capital.  They require financing.  And those providing the capital and the financing require a direct means to obtain dividends from their investment and payment for the loans provided. 

The most efficient and cost-effective means for the Biden-Harris Administration to further separate the citizens of the Republic of Cuba from the commercial and economic constraints of the government of the Republic of Cuba is to provide financial sector authorizations that encourage the development of and create an efficient resource delivery marketplace.   

If the Biden-Harris Administration wants to meaningfully provide for United States-based companies and individuals subject to United States jurisdiction to invest in and provide financing for micro, small and medium-size enterprises (SME’s) located in the Republic of Cuba, then essential to remove constraints upon the movement of funds.    

This requires sending and receiving funds directly rather than through third countries.  This requires financial institutions in third countries be authorized to process transactions relating to the Republic of Cuba.  

If the Biden-Harris Administration wants to create stress points throughout the banking system in the Republic of Cuba, then [from its current impractical status] authorize Direct Correspondent Banking and U-turn transactions. 

Critical to Biden-Harris Administration thinking: Not to sacrifice the re-emerging private sectors in the Republic of Cuba to make a political point.  Meaning, escape the trap of authorizing the processing, delivery, and distribution of electronic remittance transfers, authorizing implementation of direct correspondent banking, re-authorizing U-turn financial transactions… but doing each with onerous restrictions that results in United States companies and financial institutions unable to make practical use of the regulatory and policy decisions.  All participants require clarity rather than uncertainty.  When faced with uncertainty, United States companies and financial institutions will not engage. 

• The best example of such regulatory malpractice was during the Obama-Biden Administration (2009-2017).  In 2015, the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury authorized Pompano Beach, Florida-based Stonegate Bank (2017 assets approximately US$2.9 billion) to have a correspondent account with Republic of Cuba government-operated Banco Internacional de Comercia SA (BICSA), a member of Republic of Cuba government-operated Grupo Nuevo Banca SA, created by Corporate Charter No. 49 on 29 October 1993 and commenced operation on 3 January 1994.  Stonegate Bank provided commercial operating accounts for the Embassy of the Republic of Cuba in Washington DC, the Permanent Mission of the Republic of Cuba to the United Nations in New York City, and other types of OFAC-authorized transactions for more than eighty customers.  In September 2017, Stonegate Bank was purchased by Conway, Arkansas-based Home BancShares (2019 assets approximately US$14 billion) through its Centennial Bank subsidiary.  Despite intense advocacy, the Obama-Biden Administration National Security Council (NSC) inexplicably refused to permit BICSA a correspondent account with Stonegate Bank, so Stonegate Bank processed transactions for approximately eighty (80) customers on a regular basis through Panama City, Panama-based Multibank, which had dealings with the Republic of Cuba.   However, on 16 June 2020, Bogota, Colombia-based Grupo Aval reported: “On May 25th, Banco de Bogotá, through its subsidiary Leasing Bogotá S.A. Panamá, acquired 96.6% of the ordinary shares of Multi Financial Group.  As part of the acquisition process, MFG’s operation in Cuba was closed and as part of the transaction.  Grupo Aval complies with OFAC regulations and doesn't have transactional relationships with Cuba.”   

The OFAC should focus upon making the most basic possible.  This means electronic transfer remittances where the recipient receives their choice of currency- in Cuban Pesos (CUP) or United States Dollars and bank account to bank account.  Don’t complicate the process. 

Also vital for the Biden-Harris Administration to authorize United States companies and individuals subject to United States jurisdiction with access to all delivery platforms that currently exist in the Republic of Cuba- whether sending funds to the Republic of Cuba government-operated American International Services (AIS) Moneda Libremente Convertible (MLC) cards, through Empresa de Telecomunicaciones de Cuba S.A. (ETECSA) to wireless devices, or the use of digital currencies.  Caution with respect to supporting the use of digital currencies as the product remains unregulated, volatile in value, speculative, and susceptible to theft.  Not beneficial for the Biden-Harris Administration to introduce further economic and commercial instability to the Republic of Cuba- for which it will certainly be blamed when holders loose value.    

The OFAC could require payout (in currency and bank account to bank account) in the Republic of Cuba to be made in U.S. Dollars or CUP, at the discretion of the recipient.  The result would place pressure upon the Central Bank of the Republic of Cuba to further align the official value of the CUP at 24 to US$1.00 nearer to the unofficial rate of the CUP at 70 to the US$1.00.  Authorizing direct correspondent banking would permit electronic remittance transfers to settle respective accounts within hours rather than days- meaning a process less expensive, more efficient, and more transparent.    

The OFAC could place a “consistent with the global marketplace limit” upon electronic remittance transfer fees arriving to the Republic of Cuba that are processed by and create benefit to the government of the Republic of Cuba primarily through Revolutionary Armed Forces (FAR) of the Republic of Cuba-connected Banco Financiero Internacional S.A. (BFI), Republic of Cuba government-operated Financiera Cimex (Fincimex) and Republic of Cuba government-operated American International Services (AIS).   

The OFAC could also carve-out from the Cuba Restricted List (CRL) maintained by the United States Department of State an authorization for BFI, Fincimex, and AIS to engage solely in electronic remittance transfers, but remain subject to all other provisions of the CRL.      

Seizing Funds Remains Issue For Financial Institutions 

The use of direct correspondent banking could result in an attorney on behalf of a client asking a court to seize funds controlled by a United States-based company or financial institution with the argument that the Republic of Cuba “has an interest” in the funds.  However, there are two relevant points: 

First, important to authorize direct correspondent banking and then allow the marketplace to determine the risk associated with transactions and when direct correspondent banking is implemented.  

Second, an attorney would find that case law, OFAC license wording authorizing the process, the public benefits of direct correspondent banking, and public discourse about the consequences to United States exporters of expropriating funds owed to them as persuasive in deterring a request.   

• Since December 2001, approximately US$6,455,169,592.00 (through June 2021) of agricultural commodities and food products have been exported from the United States to the Republic of Cuba through provisions of the Trade Sanctions Reform and Export Enhancement Act (TREEA) of 2000.  Since 2003, approximately US$26,807,700.00 of healthcare products (medical equipment, medical instruments, medical supplies, pharmaceuticals) have been exported from the United States to the Republic of Cuba through provisions of the Cuban Democracy Act (CDA) of 1992.  All of these funds have been received by United States exporters through third countries rather than directly from the Republic of Cuba.  As a result, transactions take more time to complete, are more costly to the United States exporter, and are less transparent. 

• The government of the Republic of Cuba was estimated to receive on an annual basis approximately US$20 million as fees for the processing and delivery of electronic remittance transfers from the United States to the Republic of Cuba.  The approximately US$20 million represented approximately 2% of the total value of electronic remittance transfers of approximately US$1.5 billion.  The approximately 2% was in line with global norms.  Daily, the fee to the Republic of Cuba was approximately US$54,000.00.  If the OFAC were to authorize direct correspondent banking, then Denver, Colorado-based Western Union Company (2019 revenues approximately US$5.3 billion) and other companies could settle accounts daily, thus limiting the amount of funds which could be subject to court action.   

• The Central Bank of the Republic of Cuba may determine that making operational direct correspondent banking between, for example, BICSA and Home BancShares, BICSA and Western Union Company, or BFI and Western Union Company would not be in their interest due to United States statutes and regulations relating to compliance and transparency which, in their opinion, may result in financial information used to their determent.  Important to permit the Central Bank of the Republic of Cuba to make that decision rather than the Biden-Harris Administration make that decision.  Removal of obstacles places additional pressures upon the government of the Republic of Cuba to choose between engagement under conditions similar to how financial institutions in other countries make use of direct correspondent banking or continue with the third-country transfer process. 

Historical Consideration 

Conditionality, important to note, was neither effective nor sustainable during the Fidel Castro Administration (1976-2008), the Raul Castro Administration (2008-2018), or thus far with the Diaz-Canel-Valdes Mesa Administration.   

Paraphrasing a comment shared in the early 1990’s from a diplomat residing in the Republic of Cuba: Successive governments of the Republic of Cuba have been prepared for its citizens to suffer. For the Biden-Harris Administration, the question is if it is prepared to permit the citizens of the Republic of Cuba to suffer.

LINK To Complete Analysis In PDF Format

Relevant Analyses 

If Western Union Ends Remittance Services To Cuba, That Means A Return Of “Mules On Steroids”- The Impact Could Cripple MIA November 16, 2020

Western Union Data For Transfers To Cuba: 2.88 Million Annually- 24% To Havana; Florida 1st, Texas 2nd, New Jersey 3rd; US$200,000+ Could Be Aboard Each Flight From Miami November 19, 2020

Will United States Airlines Now Post A Link To FinCEN Form 105 On Their Internet Sites For Passengers Traveling To Cuba? November 23, 2020

Binary: Electronic Remittance Transfer Decision For Biden Administration And Diaz-Canel Administration; And Putting US$20 Million Into Perspective Aug 12, 2021

Healthcare Crisis In Cuba Provides Additional Questions And Opportunities For Biden-Harris Administration To Address Electronic Remittance Transfers... And Do So Practically Aug 19, 2021

Biden-Harris Administration Confirms Cuba "Remittance Working Group" Has No Private Sector Members Aug 12, 2021

Cuba Purchases Of U.S. Agricultural Commodity/Food Products Increase 94.4% Year-To-Year; June 2021 Increased 413% Compared To June 2020 Aug 8, 2021

Defining "Transformative"- Cuba Ratifies Decree-Law Authorizing SME's: Micro (1-10 employees), Small (11-35 employees), Medium (35-100 employees). The Private Sector Has Returned. Aug 7, 2021

Cuba Links Resumption Of Remittances From United States To Expanding Investment Opportunities For Cuban Residents Abroad Aug 6, 2021

Cuba Expands Again Role Of Private Sector- Suppliers, Foreign Currency Access Aug 5, 2021

European Union Member France's CMA CGM S.A. Is 41st Company Sued Using Libertad Act- Shipping To Cuba Through Jamaica And Using Port Mariel Aug 3, 2021

American Airlines Survives: Judge Quotes John Adams. Libertad Act Lawsuit Dismissed- Plaintiff Has Standing, But Inheritance Came Too Late. Aug 3, 2021

Judge In Libertad Act Lawsuit Against Seaboard Marine Dismisses 17 Plaintiffs; Remaining Plaintiff Wins Rulings- They Own The Property. Seaboard Trafficked And Knew It Was Trafficking. Settlement? Jul 31, 2021

President Biden Meets With Individuals Of Cuban Descent To Discuss Policy And Regulatory Options; Background Call Provides Details; White House Press Briefing Mentions Cuba Jul 30, 2021

U.S. Secretary Of State Speaks With Foreign Ministers Of Mexico And Spain. Cuba Does Not Come Up For Mexico Given Acts By Mexico's President? And Spain Does Not Confirm Cuba Was Discussed. Jul 30, 2021

Cuba Suspends Tariffs And Fees For Non-Commercial (SME's Next?) Solar Systems. Another Opportunity For Biden-Harris Administration To Support U.S. Exporters And Florida Companies Should Benefit. Jul 30, 2021

Iberostar Of Spain Continues To Await Decision By European Commission- How Much More Time Will U.S. Court Permit?

MARIA DOLORES CANTO MARTI, AS PERSONAL REPRESENTATIVE OF THE ESTATES OF DOLORES MARTI MERCADE AND FERNANDO CANTO BORY V. IBEROSTAR HOTELES Y APARTAMENTOS SL [1:20-cv-20078; Southern Florida District]

Zumpano Patricios P.A. (plaintiff)
Bird & Bird (defendant)
Holland & Knight (defendant)

LINKS
Defendant's Status Report (18 August 2021)
Plaintiff's Notice Of Appeal (1 June 2021)
Plaintiff's 11th Circuit Court Of Appeals Confirmation (3 June 2021)

Libertad Act Lawsuit Filing Statistics