Here We Go Again…. Cuba Export-Focused Amendments Media Releases With No Mention Of Support From Exporters/Banks. What If Cuba Defaults? No Focus On What’s Important: Direct Correspondent Banking.

Here We Go Again…. Cuba Export-Focused Amendments Media Releases With No Mention Of Support From Exporters And Banks. Fails To Focus On What’s Important: Direct Correspondent Banking. What If Cuba Defaults?

Philosophically, Intent Of Amendments Have Support From Exporters, Financial Institutions.
Exporters Do Not Want To Provide Payment Terms And Credit.
Exporters Do Need Direct Correspondent Banking.
And, What Happens To Exporters If Payments From Cuba Not Received Within One Year?

If A Committee Issues Media Releases, Useful To Have Quotes Of Support From Those Impacted Directly- And List Supporting Members From Both Political Parties.

84. “AMENDMENT TO DIVISION D OF RULES COMMITTEE PRINT 117-55 (FINANCIAL SERVICES AND GENERAL GOVERNMENT APPROPRIATIONS DIVISION) OFFERED BY MS. TLAIB OF MICHIGAN.  At the end of division D (before the short title), insert the following: SEC. __. None of the funds made available by any title in this Act may be used to implement, administer, or enforce section 908(b) of the Trade Sanctions Reform and Export Enhancement Act of 2000 (22 U.S.C.4 7207(b)).” 

137. “An Amendment To Be Offered by Representative Tlaib of Michigan or Her Designee, Debatable for 10 Minutes.  At the end of division D (before the short title), insert the following: Sec. ___.  None of the funds made available by any title in this Act may be used to implement, administer, or enforce section 908(b) of the Trade Sanctions Reform and Export  Enhancement Act of 2000 (22 U.S.C. 7207(b)).”

The Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000 e-authorized the direct commercial (on a payment of cash-in-advance 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 Cuban Democracy Act (CDA) of 1992. 

The primary issues with seeking to change payment of cash-in-advance required by the TSREEA are: 

• The companies that export agricultural commodities and food products from the United States to the Republic of Cuba have never publicly supported the provision of payment terms, credit, or financing. 

• Financial institutions which would be a source for financing of the export of agricultural commodities and food products from the United States to the Republic of Cuba have never publicly supported the provision of payment terms, credit, or financing. 

• Neither representatives of exporters nor financial institutions have appeared at hearings held by the United States Congress or issued media releases to confirm they would provide payment terms, credit, and financing if permitted to do so. 

• Why?  Because of the risk of default.  Knowing that any default migrating as it would into the public domain would doom the environment for all participants. 

What might be the consequences if enactment of Amendments 84 and 137 permitting payment terms, credit, and financing, albeit for one year, and Republic of Cuba-based importers request payment terms, credit, and financing, but United States-based exporters and financial institutions refuse Republic of Cuba-based importers due to the chronic, multi-decade shortage of foreign exchange and history of not making payments as contracted, for defaulting on obligations?  To make payments to United States-based exporters, Republic of Cuba-based importers are likely to use funds that should have been used to repay exporters in other countries. 

Today, Republic of Cuba-based importers have one choice- make cash-in-advance payment to United States-based exporters as required by the TSREEA or purchase from another source.  That makes the choice binary and 100% protective for United States-based exporters.  

Cuba's Agricultural Commodity/Food Product Imports From United States Decrease 14.5% In May 2022; Decline Of 7.31% Year-To-Year July 13, 2022 

Philosophically, the intention of Amendments 84 and 137 are in line with the views of United States-based exporters and United States-based financial institutions.  They both believe they, rather than the United States government, should determine the creditworthiness of their customers.  That the risk is for management to accept or reject rather than the United States government unnaturally interfering in the private sector commercial process.  An issue with Amendments 84 and 137 is its timing.  

With respect to Amendments 84 and 137, if included in legislation that becomes law, the time-frame is for one fiscal year, until 30 September 2023.  What happens if an exporter or financial institution provides payment terms and provides financing, and the Republic of Cuba-based importer does not make payment as provided in a contract?  What if the payment(s) arrive on 30 October 2023?  Has the United States-based exporter and United States-based financial institution violated United States law?  Are there criminal penalties?  Civil penalties?  Does the issue impact the exporter and financial institution with United States government contracts?  Might there be shareholder lawsuits? 

For the above is why changing the payment of cash-in-advance as required by the TSREEA has not, including in 1999 and 2000 prior to the legislation signed into law by William Clinton, 42nd President of the United States, been supported publicly by exporters and financial institutions. 

The preference has been to promote that the Republic of Cuba was the safest export market in the world for United States companies- because payment of cash-in-advance, while limiting export volume and U.S. Dollar value, guaranteed there would be no default by a Republic of Cuba-based importer.   

Today, given the chronic shortage of foreign exchange by the government of the Republic of Cuba, inserting risk where none exists is not prudent.  United States statutes, regulations, and policies remain a meaningful contributing factor to exacerbating the Republic of Cuba’s global commercial transaction process.  However, significant factors also include commercial, economic, and political decisions by the government of the Republic of Cuba which adversely, and continually negatively impact the ability of Republic of Cuba government-operated companies and non-Republic of Cuba government-operated companies with presence in the Republic of Cuba to earn foreign exchange from which to service their respective obligations. 

The commercial, economic, and political infrastructure within the Republic of Cuba will continue to evolve and then the question as to whether to support the provision of payment terms, credit, and financing will no longer be a concern. 

Meeks, McGovern Urge Support for Financial Services and General Government Amendment #84 Expanding Agricultural Trade with Cuba 

19 July 2022: Washington, DC – Representatives Gregory W. Meeks (D-NY), Chairman of the House Foreign Affairs Committee, and Jim McGovern (D-MA), Chairman of the Rules Committee, issued the following statement in support of Amendment #84 to H.R. 8294, which funds the Treasury Department and its Office of Foreign Assets Control (OFAC), that would suspend enforcement of the prohibition on financing of agricultural sales to Cuba.  The amendment has previously been included in numerous pieces of legislation, including the Cuba Agricultural Exports Act, which had dozens of Republican cosponsors. It is identical to a bipartisan amendment submitted to the Financial Services and General Government Appropriations bill in 2017: “We strongly support this amendment to end the U.S. government’s prohibition on financing of agricultural sales to Cuba. This common-sense legislation, which has been supported from both sides of the aisle and by agriculture groups nationwide for well over a decade, would create thousands of farm jobs in the United States while providing desperately needed food at lower cost for the Cuban people.  Today, Cuba faces its most devastating economic crisis in thirty years, forcing tens of thousands of Cuban people to spend hours in line waiting for food each and every day. In the past six months, we have seen a surge of Cubans fleeing to the U.S.-Mexico border. This amendment would help ease the economic burden by suspending U.S. farm export regulations and extending credit to Cuban food buyers for one year.  Farmers across the United States have urged action to permit greater sales from the U.S. for years, and with hunger rising across Cuba, the time is right to enact a temporary suspension that would provide them new opportunities to expand their exports to this market of 11 million people. We are hopeful that both parties can once again come together and support this win-win amendment.” 

Meeks, McGovern Urge Support for Financial Services and General Government Amendment #137 Expanding Agricultural Trade with Cuba 

19 July 2022 Washington, DC – Representatives Gregory W. Meeks (D-NY), Chairman of the House Foreign Affairs Committee, and Jim McGovern (D-MA), Chairman of the Rules Committee, issued the following statement in support of Amendment #137 to H.R. 8294, which funds the Treasury Department and its Office of Foreign Assets Control (OFAC), that would suspend enforcement of the prohibition on financing of agricultural sales to Cuba.  The amendment has previously been included in numerous pieces of legislation, including the Cuba Agricultural Exports Act, which had dozens of Republican cosponsors. It is identical to a bipartisan amendment submitted to the Financial Services and General Government Appropriations bill in 2017:  “We strongly support this amendment to end the U.S. government’s prohibition on financing of agricultural sales to Cuba. This common-sense legislation, which has been supported from both sides of the aisle and by agriculture groups nationwide for well over a decade, would create thousands of farm jobs in the United States while providing desperately needed food at lower cost for the Cuban people.  “Today, Cuba faces its most devastating economic crisis in thirty years, forcing tens of thousands of Cuban people to spend hours in line waiting for food each and every day. In the past six months, we have seen a surge of Cubans fleeing to the U.S.-Mexico border. This amendment would help ease the economic burden by suspending U.S. farm export regulations and extending credit to Cuban food buyers for one year.  “Farmers across the United States have urged action to permit greater sales from the U.S. for years, and with hunger rising across Cuba, the time is right to enact a temporary suspension that would provide them new opportunities to expand their exports to this market of 11 million people. We are hopeful that both parties can once again come together and support this win-win amendment.” 

LINKS To Related Posts 

Arkansas Senator Boozman Will Re-introduce Legislation To Permit Payment Terms And Financing For U.S. Ag/Food Exports To Cuba. He Should Wait Until There Are Contracts In Place. June 30, 2021

Are Cuba Advocates Again Ahead Of Tips Of Their Legislative/Regulatory Skis? February 27, 2021

Five Essential Elements For Cuba Food/Ag Legislation To Be Successful In The U.S. Congress May 19, 2019

Do U.S. Secretaries Of Agriculture & Treasury Comprehend Value Of Direct Correspondent Banking To Exporters? February 13, 2018

Change To OFAC Banking Regulation Long Overdue; No Rationale For Delay September 26, 2016

US Expected To Authorize Banks In Cuba To Have Correspondent Accounts With US Banks March 04, 2016

LINK TO COMPLETE ANALYSIS IN PDF FORMAT

France’s Accor Had 4 Properties In Cuba; Now 1. Disagreements About Standards, Funding. SO/Havana Paseo del Prado Will Be Royalton Habana Managed By Canada’s Blue Diamond Resorts

Accor Of France Managed Four Properties In Cuba.  Now One.  Disagreements About Standards, Funding.  Latest SO/Havana Paseo del Prado, Managed Since 2018.  Will Become Royalton Habana Managed By Canada’s Blue Diamond Resorts. 

Permitting another another internationally-recognized luxury brand to exit the marketplace demonstrates financial pressures and management philosophy constraints continuing to impact government of the Republic of Cuba and a return to focus upon fewer brands and mid-market demographic.

Issy-les-Moulineaux, France-based Accor S.A. is a “multinational hospitality company that owns, manages and franchises hotels, resorts and vacation properties. It is the largest hospitality company in Europe, and the 6th largest hospitality company worldwide.  Accor, with more than 230,000 employees, operates 778,000 rooms in 5,300 locations in more than 110 countries.”  Accor S.A. had four properties under management in the Republic of Cuba.  Now, it has one. 

178-room Hotel Mercure Sevilla Havane (1995-2018)
385-room Mercure Playa de Oro (2012-2017)
518-room Pullman Cayo Coco Hotel (2015- )
250-room SO/Paseo Del Prado La Habana (2018-2022)

The Mercure Playa de Oro Varadero is owned by Republic of Cuba government-operated Gran Caribe. Disagreement as to responsibility for financing for renovations resulted Accor S.A. returning the property to Gran Caribe.  Accor S.A. had reported that the Hotel Mercure Sevilla Havane was to undergo a US$20 million renovation to become an MGallery by Sofitel property. Disagreement as to responsibility for financing resulted in Accor S.A. returning the property to its owner, Gran Caribe.

Pullman Cayo Coco Hotel (518 rooms): The property of owned by Gran Caribe. Accor S.A. has managed the property since December 2015. From Accor S.A.: “Hotels combining lifestyle and design, for business and leisure. All-inclusive 5-star resort facing the Caribbean Sea and ideally located in the hearth of the ecological park of the island of Cayo Coco. The resort has 2 sections: main hotel featuring 522 deluxe rooms and The Collection by Pullman adult only section offering junior suites, full suites and private Golden Villa. Our property offers a choice of 8 restaurants, 10 bars, 7 pools, 600-meter long private white sand beach, state of the art spa, Kids Club, banquet facilities and much more. Located off the Northern Cost of Cuba, on the Atlantic Ocean side, and part of the Jardines Del Rey archipelago that counts over 2,500 islands and cays widely renowned for its white sand beaches, calm and crystal-clear waters and natural surroundings.”

The spirited luxury brand is set to debut SO/ Havana Paseo del Prado in early 2020 and will feature signature creative touches by renowned fashion designer Agatha Ruiz de la Prada 

“Toronto, 19 September 19 2018- ​AccorHotels announces plans to further expand its presence and options for travelers in the Americas with the introduction of SO/ Havana Paseo del Prado, a new address set to open in early 2020 in Havana, Cuba. As the first SO/ property in the Americas region, the hotel will showcase the brand’s rebellious, immersive interpretation on the luxury travel experience. SO/ Havana Paseo del Prado will be located at the intersection of Paseo de Marti and Malecón, in the heart of one of the most emblematic neighborhoods of Cuba’s capital.  “We are thrilled to introduce the vivid and playful SO/ Hotels & Resorts brand into the Americas and look forward to debuting the brand’s first hotel in the region in the heart of Havana,” said Heather McCrory, AccorHotels Executive Vice President of Operations, North & Central America. “Vibrant, edgy, fashionable and bursting with local energy, SO/ hotels are an exceptional fusion of local culture, lively entertainment, outstanding food and beverage options and services, and avant-garde design with a touch of luxury. We are certain that SO/ Havana Paseo del Prado will please even the most audacious luxury travelers and become one of the most trendy and social destinations in the city.” “

“A Luxury Hotel Brand Makes its Debut in Havana: One of the fastest growing brands in the AccorHotels luxury portfolio, SO/ Hotels & Resorts is an exclusive lifestyle brand with one-of-a-kind, fashionable properties located in select high-energy and dynamic destinations worldwide. With design at the core of the SO/ brand, the hotel in Havana will unfold as a glamorous yet playful masterpiece featuring the creative signature of celebrated Spanish fashion designer Agatha Ruiz de la Prada – from the hotel’s emblem to the staff’s stylish uniforms.  "I am incredibly excited to take part in the design of the new SO/ Havana Paseo del Prado,” commented Agatha Ruiz de la Prada. “Havana is a magical and colorful city, and the design process came quite naturally. The world of Cuban dance was my central inspiration, and with that, the project came alive almost out of its own accord.”  With 10 stories above street level on a 5,000 square-meter parcel, SO/ Havana Paseo del Prado will feature 250 guest rooms, including 36 suites. Ranging in size from 34 to 64 square meters, guest rooms will consist of stylish contemporary furnishings, neutral palettes, splashes of color, innovative technology and thoughtful designer amenities.  The hotel will offer five food & beverage outlets including a specialty restaurant and rooftop bar on the ninth floor, an exclusive chocolate café bar, a lively lobby lounge and bar, and an all-day signature dining restaurant. Additional hotel features include three interior meeting rooms spanning approximately 200 square meters; a 400 square-meter SO/ SPA with six treatment rooms; a 150 square-meter SO/ FIT fitness center; and a 155 square-meter swimming pool with an adjacent pool bar. The hotel will also feature additional signature elements of the SO/ lifestyle such as the Just Say SO service and SO Parties, featuring the hottest DJs and artists.”

“In partnership with AccorHotels, SO/ Havana Paseo del Prado is part of Grupo de Turismo Gaviota, a Havana-based tourism and hospitality company boasting three decades of experience in the industry with over 85 hotels, representing more than 30,400 rooms throughout Cuba.  SO/ hotels are vibrant and highly sought-after destinations for trendy and discerning travelers. In addition to SO/ Havana Paseo del Prado, the brand will soon unveil hotels in dynamic and desirable locations including Auckland (November 2018), Kuala Lumpur (2020), Samui (2020) and Jakarta (2021.)These additions will expand an eclectic SO/ portfolio which already includes two stunning SO/ properties in Thailand, Bangkok & Hua Hin, SO/ Mauritius, SO/ Singapore and the recently opened properties including SO/ Berlin Das Stue, SO/ Vienna and SO/ St. Petersburg.” 

Blue Diamond Resorts Will Manage One of the Most Luxurious Hotels in Cuba 

“TORONTO, 18 July 2022 (GLOBE NEWSWIRE) -- As part of the ongoing efforts to strengthen and expand its portfolio within the region, Blue Diamond Resorts Cuba is pleased to announce that it will take over the operation of the most luxurious hotel in Habana which will be rebranded as Royalton Habana, with operations expected to begin on August 1st, 2022.  This 250-room city hotel offers both a privileged location and stunning views. Nestled right in the entrance to the country’s capital, Royalton Habana will provide astonishing views from inside and outside; thanks to its modern look as well as the views provided from the rooms, its three restaurants and bars, and the rooftop infinity pool that faces the Habana Bay and the San Salvador de la Punta Castle, one of the three key forts in Habana.  The property, owned by Grupo de Turismo Gaviota, one of the most important tourism companies in the Caribbean, will offer exclusive features that will make this hotel the ideal place for all types of discerning travelers.  “This new addition to our portfolio is a major milestone to our company and the region,” mentioned Mohamad Fawzi, Managing Director for Blue Diamond Resorts Cuba. “Royalton Habana will allow us to evolve in city tourism with a hotel focused on luxury with which we will be able to make our clients enjoy great experiences. We are convinced that it will become a benchmark hotel for both Blue Diamond Resorts Cuba and the region,” he added.  Although this hotel will not be the first city hotel managed by Blue Diamond Resorts Cuba, Royalton Habana will be the first city hotel within the Royalton Luxury Resorts portfolio.  Blue Diamond Resorts Cuba is consolidated throughout the Caribbean as the fastest growing hotel chain, now with 36 properties in its portfolio and more than 10,000 rooms. The company has experienced considerable growth this year. Only a few weeks ago, Blue Diamond Resorts Cuba announced that it will exclusively manage the touristic region of Cayo Largo del Sur.”   

“About Blue Diamond Resorts: Since its inception in 2011, Blue Diamond Resorts has curated an impressive portfolio encompassing 45 properties, exceeding 18,000 rooms in ten countries. Taking a proactive approach to differentiating brands under each market’s demands, the resort management company caters to a range of budgets and interests from adult-only elegant getaways to fun-filled family vacations. Award-winning, All-In Luxury® Royalton Luxury Resorts offers signature amenities including All-In Connectivity™, modern Sports Event Guarantee™, and in-suite wellness elements. Royalton Luxury Resorts’ adults-only sub-brands include Hideaway at Royalton, an adults-only experience with exclusive dining and preferred accommodations, plus the stylish lifestyle resort, Royalton CHIC, located in the Caribbean’s best beachfront locales. In Jamaica, Grand Lido Negril provides those over 21 with an upscale and luxurious naturist vacation along with a secluded shore for the utmost privacy. Memories Resorts & Spa offers a vacation designed to impress the entire family, while Starfish Resorts provides amazing value for customers in convenient locations. Planet Hollywood Hotels and Resorts invites guests to Vacation Like A Star™ with an engaging and interactive experience, plus famous pop culture items from iconic movies, music, and sports. Mystique by Royalton, a boutique-style resort collection, offers personalized vacations in strikingly beautiful locals full of endless adventures.”   

LINKS To Related Posts

Could Accor S.A. Of France Be Subject To Libertad Act Lawsuits? October 13, 2019

Wyndham’s Super 8 Worldwide Will Not Manage Resort Property In Cuba May 16, 2017

Wyndham Worldwide's Super 8 Replaces Accor To Manage Cuba Property February 15, 2017

Icelandair To Operate U.S.-Cuba Flights Using "Wet Lease" With Boeing 757-200 Aircraft

Simple Flying
St. Laurent, Quebec, Canada
18 July 2022

Icelandair Approved To Fly US-Cuba Charter Flights
By Andrew Curran

Icelandair overcame objections from US-based interests to win approval to operate wet lease charter flights between the US & Cuba this summer. The US Department of Transportation has approved an application by Icelandair to fly up to 31 round trip flights a week between the United States and Cuba on behalf of Florida-based World Atlantic Airlines. The approval for the flights this summer came despite strident objections from the Air Line Pilots Association, Swift Air, and the Allied Pilots Association. 

In mid-June, Simple Flying reported Icelandair's application to wet lease a Boeing 757-200 to World Atlantic Airlines to operate the flights. It is not the first time Icelandair has done this. For example, earlier this year, Icelandair flew between three US cities and Cuba on behalf of Miami-based Anmart Air. 

Icelandair will send a Boeing 757-200 (pictured) to World Atlantic Airlines to operate the charter flights to Cuba. Photo" Vincenzo Pace/Simple Flying  

But as that report noted, US-based aviation players don't like outside players encroaching onto what they see as their turf. Dark claims of harm to US interests and abuse of flying rights were raised. The Department of Transportation (DOT) says it considered all of the objections, including procedural aspects, market access, competitive factors, travel restrictions, and some public interest factors. But the DOT says the arguments were not persuasive enough to knock back Icelandair's application. 

"We have decided to approve Icelandair's application," says the DOT in its approval notice that gives Icelandair permission to operate the flights between July 14 and October 31. The DOT says several factors got the Icelandair application over the line; including reciprocity in Icelandair's home market; the level of Icelandair's reliance on seventh-freedom operations as compared to its third/fourth-freedom operations; the needs of the charterer (World Atlantic Airlines); and the public interest.  "We find that sufficient reciprocity exists with Iceland to support grant of the carrier's extra bilateral request as conditioned and note that there is no evidence on the record from any party to indicate that the Government of Iceland has denied seventh-freedom charter requests of US carriers," the DOT notice says.  Seventh freedom refers to the right to fly between two foreign countries, whereas third and fourth freedom flying rights deal with flying from an airline's home country to another country. One of the objections raised was that Icelandair relied too much on seventh freedom flying instead of focusing on flights to and from Iceland. In airline circles, that is a big no-no. 

"We have also considered the undue reliance claim, a factor that we take very seriously. That claim is not supported in this case," says the DOT. The US Government department also says it prefers to offer charterers like World Atlantic Airlines the maximum flexibility possible when choosing an airline and aircraft to best suit their operational needs. The DOT says World Atlantic clearly argued why Icelandair was best suited to meet its needs.  "This factor, along with our findings above supports the granting of the requested authority under our well-established public interest standards for considering requests of this nature." adds the DOT when providing some context to the decision.

Simpleflying.com
St. Laurent, Quebec, Canada
18 July 2022

Planned Wet Lease Icelandair Flights To Cuba Encounter Some Turbulence
By Andrew Curran

World Atlantic Airlines want to wet lease an Icelandair jet to fly to Cuba this summer, but some sections of the US airline industry are crying foul. 

Plans by charter carrier World Atlantic Airlines to wet lease an Icelandair Boeing 757-200 to fly seasonal services between the US and Cuba this summer have encountered fierce opposition from sections of the US airline industry. Icelandair wants to send their Boeing south pronto to begin operating 31 round trips a week between the two countries and capitalize on the peak northern summer flying season. 

In a June 3 letter to the US Department of Transportation (DOT), Icelandair asks for permission to wet lease the 197-seat aircraft on a long-term basis to World Atlantic Airlines to operate flights between July 15 and October 31, 2022. While the letter says the aircraft will "primarily" fly the US-Cuba country pair, they want wriggle room to fly the plane to other unspecified Caribbean countries. With a tight deadline, Icelandair also asks the DOT to waive the usual 45-day advance notification requirement. 

Readers will likely know Reykjavík-based Icelandair. They serve around a dozen US airports. But World Atlantic Airlines is a different matter. The Miami-based charter operator was formerly known as Caribbean Sun Airlines and operates a tight fleet of McDonnell Douglas MD-83 planes. What seems to be getting up the noses of the US airline industry is Icelandair's incursion onto their turf, namely the US - Cuba routes. 

It's not the first time Icelandair has done this. They've spent much of the last 12 months annoying their US rivals with DOT applications to fly wet lease charter flights between the US and Cuba. As recently as last year, World Atlantic Airlines was crying foul over an Icelandair's proposal to fly seasonal charter services (February - May 2022) to Cuba out of three US ports on behalf of Anmart Air. But the DOT gave Icelandair the greenlight anyway. Now, perhaps World Atlantic Airlines thinks if you can't beat them, you might as well join them. 

As Icelandair points out in its June 3 letter, the proposed service is in line with the bilateral US - Cuba air service agreement and "with comity and reciprocity between the Governments of Cuba and Iceland." 

But North Carolina-based Swift Air calls the application "Icelandair's latest attempt to establish a permanent, year-round seventh-freedom operating base in the United States so it can fly between the US and a third non-open skies country. The Application does not describe the wet lease terms at all and even leaves open which markets World Atlantic and Icelandair propose to serve." 

The Air Line Pilots Association (ALPA) has told the DOT that Icelandair's proposed operations would "do direct and substantial harm to US operators in the market." ALPA argues the US-Cuba market is not an open skies market, and US carrier operations remain severely constrained by the OFAC restrictions, which strictly limit the categories of US passengers that are allowed to travel to Cuba. Further, ALPA says Icelandair's proposed seventh freedom passenger operation (more than four daily flights) exceeds its level of Iceland-US flights and constitutes "undue reliance" on seventh freedom traffic. 

"This represents an exponential increase in Icelandair's seventh freedom passenger operations," says ALPA's submission to the DOT. "Taken on an annual basis, it exceeds Icelandair's third and fourth freedom services between the US and Iceland. As such, denial is compelled under the established doctrine of undue reliance." 

ALPA's letter sounds nice and lawyerly. But Icelandair weathered similar strident objections last year and got its proposals past the DOT. On that basis, they are probably confident of a repeat summer in Cuba season. With flights slated to start from mid-July, Icelandair and World Atlantic Airlines must be counting on a DOT decision soon.

Confiserie Sprungli Of Switzerland Truffles Using Trinitario Cocoa Beans From Cuba. Might Products Qualify For Export To The United States Like Nespresso Coffee?

“The exquisite Trinitario cocoa bean from the east of the island of Cuba, where the Atlantic Ocean meets the Caribbean Sea, is the basis of this truffle creation.  The pure natural product is blended with many years of experience to deliver an indescribable taste experience: fruits, black tea and a hint of vanilla.”

From The Company: “Since we are a traditional Zurich-based company we sell our products exclusively through our own Spruengli stores (Switzerland, Dubai, and Abu Dhabi) and via our E-Shop.  We regret to inform you that it is not our business policy to export our products through a franchising system nor do we sell any licenses.  Furthermore, we also do not have any expansion plans for the United States.  For our Cuba Auténtica Collección products we only use cocoa beans from Baracoa, Cuba.”   

“The beans are obtained by another company, Max Felchlin AG located in Schwyz, Switzerland.  Link: https://www.felchlin.com/en/company/company-portrait.  They import the cocoa beans and process them to couverture chocolate which we then use for our well-known products.”  

Bureau of Economic and Business Affairs
United States Department of State
Washington DC

Goods and Services Eligible for Importation: “In accordance with the policy changes announced by the President on December 17, 2014, to further engage and empower the Cuban people, Section 515.582 of the Cuban Assets Control Regulations (31 CFR Part 515 – the CACR) authorizes the importation into the United States of certain goods and services produced by independent Cuban entrepreneurs as determined by the State Department as set forth on the Section 515.582. The goods whose import is authorized by Section 515.582 are goods produced by independent Cuban entrepreneurs, as demonstrated by documentary evidence, that are imported into the United States, except for goods specified in the following sections/chapters of the Harmonized Tariff Schedule of the United States (HTS).”   

To date, only coffee beans (one importer) and charcoal (two importers) have been included on the list of goods authorized for export from the Republic of Cuba to the United States.  Republic of Cuba government-operated Cubaexport (under the auspice of the Ministry for Foreign Trade and Foreign Investment of the Republic of Cuba) has refused requests to authorize coffee beans for direct export to the United States and thus far refused requests to authorize bulk honey and cocoa beans for direct export to the United States.    

In August 2016, New York, New York-based Nestle Nespresso USA, Inc., a subsidiary of Vevey, Switzerland-based Nestle SA (2019 revenues approximately US$93 billion), introduced to the United States the first of multiple releases of the “Cafecito de Cuba” capsule.  The coffee beans are exported from the Republic of Cuba to Switzerland for processing and then exported to the United States and other countries for sale-at-retail.   

In January 2017 and July 2018, Hialeah, Florida-based Fogo Premium Lump Charcoal purchased a total of four twenty-foot containers of charcoal from the Republic of Cuba for distribution throughout the United States.   

In May 2019, Foley, Alabama-based GulfWise Commerce LLC, affiliated with Foley, Alabama-based Woerner Companies (2019 revenues exceeded US$40 million) purchased two forty-foot containers of charcoal from the Republic of Cuba for distribution (including through Amazon.com and True Value hardware stores) throughout the United States. 

The companies reported no transactional issues with the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury, Bureau of Industry and Security (BIS) of the United States Department of Commerce, or Office of Legal Adviser (OLA) at the United States Department of State.  

LINKS To Related Posts:

Confiserie Sprungli AG & Dieter Meier Of Switzerland Use Cocoa Beans From Cuba June 20, 2018

Nestle Nespresso To Indirectly Import Coffee From Cuba To USA June 20, 2016

“Hecho En Cuba” Begins To Mean Something…. Is The Obama Administration Complying With Its Regulations? July 06, 2016

UPDATE: “Hecho En Cuba” Has Value…. Obama Administration Will Help & Accept Certification From Cuba July 14, 2016

Coffee & Charcoal Have Been Imported From Cuba; U.S. Companies Want More. Agricultural Commodities/Food Products/Healthcare Products Have Been Exported To Cuba; U.S. Companies Want More. October 02, 2021

Might Cubaexport In 2020 Permit “Independent Entrepreneurs” To Export Coffee Beans, Cocoa and Honey To The United States? January 14, 2020

EFE Of Spain Reports "SME investment in Cuba a key goal of business forum." Unfortunately, Cuba Media Does Not Highlight SME Focus

EFE (Madrid, Spain): Expanded Mexican SME investment in Cuba a key goal of business forum 

Expanded Mexican investment in Cuba by small and medium enterprises (SMEs) is a key theme of the Cuba-Mexico Business Forum, a two-day event that kicked off Thursday in Havana.  Cuban President Miguel Diaz-Canel and Prime Minister Manuel Marrero Cruz were on hand for the inauguration of the forum at the historic Hotel Nacional de Cuba, as were Mexico's undersecretary of industry and commerce, Hector Guerrero, and Mexican Ambassador to Cuba Miguel Diaz Reynoso. 

https://www.efe.com/efe/Images/logos/efe_logo_150x75alpha.png 

teleSUR (Caracus, Venezuela): The forum's inaugural session, which continues through Friday, was attended by Cuban President Miguel Diaz-Canel, Cuban Prime Minister Manuel Marrero and other high-ranking officials.  Representatives of some 150 Cuban and 80 Mexican companies on Thursday attended the opening of the Cuba-Mexico Business Forum at the Hotel Nacional de Cuba in the capital city Havana.  The inauguration of the event was in charge of the president of the Chamber of Commerce of Cuba Antonio Luis Carricarte, the Cuban Prime Minister, Manuel Marrero. The Undersecretary of Industry and Commerce of the Ministry of Economy of Mexico, Hector Guerrero will also be present at the event.  Given the impact of the COVID-19 pandemic on world economies, Guerrero described trade ties between Cuba and Mexico, Latin America's second-largest economy, as "strategic and fundamental" to the island's recovery. 

Prensa Latina (Havana, Cuba): Deputy Prime Minister Alejandro Gil told participants today at the Cuba-Mexico Business Forum that the island's economy in the first half of 2022 continues in the process of gradual recovery. https://t.co/07BS1yCAm0 — Carlo (@CarloTresero) July 14, 2022  Cuba's Deputy Prime Minister Ricardo Cabrisas said Cuba is working to overcome the economic setbacks of the past two years. "We have a long road ahead of work, opportunities and reciprocal advantages," said Cabrisas.  The forum's inaugural session, which continues through Friday, was attended by Cuban President Miguel Diaz-Canel, Cuban Prime Minister Manuel Marrero and other high-ranking officials.  Organized by the Cuban Ministry of Foreign Trade, the Center for the Promotion of Foreign Trade and Foreign Investment, the Cuban Chamber of Commerce and the Embassy of Mexico in Cuba, the forum focuses on areas of common interest such as renewable energy, biotechnological and pharmaceutical industries, tourism, transportation, and construction.

Cuba-Mexico Business Forum concludes with agreements
By Elsy Fors Garzon

Havana, July 15 (Prensa Latina) The Cuba-Mexico Business Forum concluded today with the signing of 12 documents between Mexican and Cuban companies in the textile, food, information technology, renewable energy, culture and environmental services, professionals. The signing of the letters of intent and cooperation agreements were in charge of the Cuban Minister of Foreign Trade and Foreign Investment, Rodrigo Marmierca and the Undersecretary of Industry and Commerce of Mexico, Héctor Guerrero. Businessmen from both nations held business rounds at the Hotel Nacional headquarters for two days and analyzed the opportunities to expand economic, commercial and financial relations. The meeting was attended by representatives of some 80 Mexican companies and 150 from Cuba and discussed possible economic and commercial links, in the branches of agribusiness, biopharmaceutical and medical services, energy, transportation, tourism and creative and artistic industries. The president of Cuba, Miguel Díaz-Canel, attended the inauguration, where Guerrero conveyed to Cuba an affectionate and warm greeting from the president of his country, Andrés López Obrador.

Cuba's Agricultural Commodity/Food Product Imports From United States Decrease 14.5% In May 2022; Decline Of 7.31% Year-To-Year

ECONOMIC EYE ON CUBA©
July 2022

May 2022 Food/Ag Exports To Cuba Decrease 14.5%- 1
55th Of 221 May 2022 U.S. Food/Ag Export Markets- 2
2022 Exports Decrease 7.31%- 2
Cuba Ranked 53rd Of U.S. Ag/Food Export Markets- 2
May 2022 Healthcare Product Exports US$410,639.00- 2
May 2022 Humanitarian Donations US$1,124,280.00- 3
Obama Administration Initiatives Exports Continue- 3
U.S. Port Export Data- 16

MAY 2022 FOOD/AG EXPORTS TO CUBA DECREASE 14.5%- Exports of food products and agricultural commodities from the United States to the Republic of Cuba in May 2022 were US$25,514,586.00 compared to US$29,848,778.00 in May 2021 and US$20,650,953.00 in May 2020.

January 2022 to May 2022 exports were US$121,129,255.00 compared to January 2021 to May 2021 exports of US$130,685,900.00.

May 2022 Exports Included: Corn; Soybeans; Chicken Leg Quarters (Frozen); Chicken Meat (Frozen); Chicken Legs (Frozen); Woodpulp; Coffee; Beer; Deodorants; Soap; Disinfectants; Insecticides; Cocoa Preparations.

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.

Click here for a list of agricultural commodities eligible for export to Cuba under Section 902(1) of the Trade Sanctions Reform and Export Enhancement Act of 2000

Complete Report In PDF Format

After 27 Months, European Commission (EC) And Iberostar Hoteles Of Spain Efforts That Delay Libertad Act Court Proceedings Are Now Running On Fumes

After twenty-seven (27) months of delay, while other lawsuits that include European Union (EU)-based defendants in Libertad Act Title III lawsuits filed in the United States have proceeded, the comity governing court proceedings in the United States when impacted by other country statutes (or in this instance EU policy) will likely soon end as plaintiffs file motion with Court that their rights to a trial have been deliberately delayed.

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; 21-11906 11th Circuit Court of Appeals] 

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

Defendant’s Status Report (7/11/22)
Defendant’s Status Report (6/10/22)
Defendant’s Status Report (5/26/20)
Status Report On Service Of Process (4/7/20)

Excerpts: 

“Defendant IBEROSTAR HOTELES Y APARTAMENTOS, S.L.U. (“Iberostar”) submits1 this status report pursuant to this Court’s Order Granting Defendant’s Motion to Stay Proceedings dated April 24, 2020 (D.E. 17), directing Defendant to submit status reports every 30 days on its request for authorization to the European Union Commission. Defendant states as follows: 1. Since the last update filed on June 10, 2022, Iberostar continues to await a decision on its application for authorization to the European Commission to respond to the Complaint in this action which was filed with the European Commission on April 15, 2020 (the “Application”). Defendant’s Motion to Stay, ¶ 2. (D.E. 16).” 

“We have not received additional information from the Commission on this matter. Defendant is attempting to obtain information from the Commission on the current status, and will keep this Court duly apprised of any further developments regarding the request for authorization from theEuropean Commission.” 

The Trump-Pence Administration (2017-2021) 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.   

Title IV restricts entry into the United States by individuals who have connectivity to unresolved certified claims or non-certified claims.  One Canada-based company and one Spain-based company are currently known to be subject to this provision based upon a certified claim and non-certified claim. 

LINK To Libertad Act Title III Lawsuit Filing Statistics

In Terminal 4 At Madrid-Barajas Airport, "Havana Club" From Cuba Has A Display, Bacardi From Bermuda Has A Display. No "Havana Club" From Bacardi.

Adolfo Suárez Madrid–Barajas Airport (MAD) is the main international airport serving the capital city of Madrid in Spain.

Libertad Act Title III Lawsuit Against American Airlines Dismissed With Prejudice By Judge.

JOSE RAMON LOPEZ REGUEIRO V. AMERICAN AIRLINES INC. AND LATAM AIRLINES GROUP, S.A. [1:19-cv-23965; Southern Florida District]

Rivero Mestre LLP (plaintiff)
Manuel Vazquez, P.A. (plaintiff)
Jones Day (defendant)
Akerman (defendant)

Excerpt: “In sum, the Court’s exercise of specific jurisdiction over American Airlines, but not general jurisdiction, comports with due process requirements. After conducting a de novo review, the Court overrules the remaining objections. Accordingly, it is hereby ADJUDGED that 1. Magistrate Judge Louis’ Report and Recommendation, (ECF No. 174), is AFFIRMED AND ADOPTED IN PART. 2. Plaintiff’s Motion to Dismiss, (ECF No. 123), is GRANTED. This case is DISMISSED WITH PREJUDICE because (1) the José Martí International Airport was not allegedly confiscated from a United States National, and (2) Plaintiff was not a United States National when he allegedly acquired his claim to the José Martí International Airport.”

LINK To Order on Report And Recommendation (6/30/22)
LINK To Libertad Act Lawsuit Filing Statistics

Electric Vehicles Are Useful For Cuba's Entrepreneurs- So Why Won't Biden Administration Authorize Their Export? Investments And Loans Are OK, So Should Be Efficient Vehicles.

On 10 May 2022, the Biden-Harris Administration (2021- ) directed the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury to issue a license authorizing the first direct equity investment in and first direct investment to an officially-registered privately-owned business in the Republic of Cuba. Such authorization had not been permitted in more than sixty years.

LINK: With U.S. Government Authorization For First Direct Equity Investment Into A Private Company In Cuba, Here Is Important Context And Details.  About The Parties; About The Message. May 16, 2022

No petrol, no cars: Cubans turn to electric transport
There are increasing numbers of electric vehicles whizzing among the old American cars so emblematic of the Cuban capital
By AFP
18 June 2022

SANTA CLARA: There is a new sight on the streets of Havana: increasing numbers of electric vehicles whizzing among the old American cars so emblematic of the Cuban capital.  As fuel shortages and US sanctions take their toll, and even though electricity generation can be spotty, Cubans are turning to smaller, cheaper, plug-in alternatives. 

"Gasoline? Imagine. After 50 years battling to get hold of it, I don´t even want to smell it anymore!" taxi driver Sixto Gonzalez, 58, told AFP atop the shining, electric-blue quadricycle with which he moves through the streets at a top speed of about 40 kilometers (25 miles) per hour.

Gonzalez has abandoned his old, combustion-engine car -- one of about 600,000 registered on the island of 11.2 million people, according to official data.  The last time he tried to fill it up, he stood in a queue for eight hours. 

By far the majority of cars in circulation in Cuba are American models from the 1950s -- before sanctions started -- and compact Ladas from the Soviet era.  Newer models are practically impossible to lay one´s hands on and come with a hefty price tag of between about $20,000 and $100,000. 

The quadricycle Gonzalez bought, by comparison, can be obtained for between $4,000 and $8,000 and though slower, can get four or five people from Point A to Point B.  Also increasingly popular are electric motorbikes -- of which there are an estimated 40,000 to 50,000 in Cuba -- and three-wheelers all the more frequently seen dragging a carriage full of passengers or goods. 

In a once-abandoned Soviet-era truck factory in the central city of Santa Clara, about 100 workers of the company Minerva assemble electric vehicles with parts imported from China or Vietnam.  The objective for 2022 is to produce 10,000 electric motorbikes, Minerva boss Elier Perez told AFP -- double the factory´s previous record -- as well as 2,000 three-wheelers.  "I had to buy one because the fuel ran out and the queues are endless," said Raul Suarez, a 52-year-old security guard who got himself an electric motorbike.  "I have to be able to get around." 

Not only are cars prohibitively expensive and scarce, but public transport in the capital is a daily ordeal for many.  Half of buses are out of service for a lack of tires and batteries that cannot be imported due to US sanctions, said transport ministry official Guillermo Gonzalez.  Havanans sometimes wait for hours for a bus to get to work or back home. 

At the same time, fuel shortages have worsened since the US reinforced its six-decade-old economic blockade of the communist island in 2019, preventing the arrival of fuel tankers from Venezuela, a Cuban ally.  Petrol supply plummeted from 100,000 barrels a day to about 56,000 barrels per day on average in 2021, said Jorge Pinon, a Cuban energy policy expert at the University of Texas.  Three years ago, the government began to promote the use of electric cars, introducing them to state-owned companies to be used by workers.  "Cuba is a museum on wheels," said Gonzalez of the abundance of decades-old gas guzzlers.  It is hoped that a rollout of electric cars will lower "fuel consumption... and at the same time reduce pollution," he added. 

But electricity supply, too, is a concern.  For weeks now, Cubans have had to deal with regular cuts, sometimes lasting hours at a time, due to generation failures and maintenance work on thermoelectric plants.  And in a bid to make up some of the shortage, the authorities have turned to generators that use up much of the limited diesel stock.  "There has never been a situation as difficult as the one we have now, and there are still three months of summer to come," said Pinon, alluding to the annual warm-weather rise in demand for energy to run air conditioners. 

Ramses Calzadilla, director of strategy at Cuba´s energy ministry, said he was confident that electricity generation would be restored to full capacity shortly and insisted the situation did not threaten the burgeoning electric vehicle sector.  "An electric motorcycle uses about as much energy as a refrigerator," he told AFP, and can be charged quickly and cheaply between programmed power cuts.

Links To Republic Of Cuba EV-Related Analyses

From U.S. Department Of State: There Is A "lack of trained mechanics on the island to service electric vehicles." So, Who Are Servicing These Vehicles? Is The Video "Fake News" February 11, 2022

U.S. Department Of State Appoints "Chief Sustainability Officer"- Mandate Text Includes Focus On "Electrifying Fleet" And "Host Partners" Does This Mean EVs For Cuba? President Biden Supports? February 10, 2022 

While Promoting EV Use In The United States, Biden-Harris Administration Refuses To Permit Exports Of EVs To Cuba For Use By Re-Emerging Private Sector- And U.S. Embassy In Havana Does Not Want One. February 08, 2022

Surprise Decision: Biden-Harris Administration Renews Trump-Pence Administration License To Export EVs To Embassies In Cuba. Company Offers To Donate EV Chargers To U.S. Embassy/Ambassador Residence  January 25, 2022 

President Biden Rejects BIS License Application To Export Electric Vehicles/Chargers To Cuba's Self-Employed, MSME's. Reversal Of "General Policy Of Approval." President Trump Authorized EV Exports.  December 20, 2021  

Beginning Today Residents Of Cuba May Purchase And Install Residential Solar Systems. Cost 55,000.00 Pesos (US$2,300.00). Call 7833-3333.  November 04, 2021  

Cuba Has Nickel And Cobalt. Vehicle Electric Batteries Use Nickel And Cobalt. Cuba Should Benefit.  September 25, 2021  

Cuba Owes Partner Canada's Sherritt International Corporation Tens Of Millions Of US Dollars. But, Both Cuba & Patient Company (And Shareholders) Anticipate Profitable Role With Electric Vehicles.  July 03, 2021  

Restriction On Sale Of Premium Gasoline May Benefit Electric Vehicles & Solar Panels; Embassies Concerned.  April 07, 2017  

Florida Company Receives License To Export Electric Vehicles To Cuba; Charging Stations From New Jersey-Based Company.  January 25, 2017

Havana Docks Corporation And Carnival Corporation Attorneys And Executives Meet Second Time For Mediation. Mediator Reports An Impasse. A Settlement Or Trial May Be Nearing...

HAVANA DOCKS CORPORATION, Plaintiff, v. CARNIVAL CORPORATION d/b/a CARNIVAL CRUISE LINE, a foreign corporation. Defendant.

MEDIATOR’S REPORT

In accordance with Local Rule 16.2(f)(1) of the Southern District of Florida, the undersigned Mediator reports that this matter was mediated for a second time on Wednesday, June 8, 2022. All counsel and parties were present. The mediation resulted in an impasse.

Date: June 13, 2022
Respectfully submitted,
By: /s/ Thomas E. Scott, Esq. Thomas E. Scott, Esq. Mediator

LINK: Libertad Act Title III Lawsuit Filing Statistics

HAVANA DOCKS CORPORATION VS. CARNIVAL CORPORATION D/B/A/ CARNIVAL CRUISE LINES [1:19-cv-21724; Southern Florida District]
Colson Hicks Eidson, P.A. (plaintiff)
Margol & Margol, P.A. (plaintiff)
Jones Walker (defendant)
Boies Schiller Flexner LLP (defendant)
Akerman (defendant)

HAVANA DOCKS CORPORATION V. MSC CRUISES SA CO, AND MSC CRUISES (USA) INC. [1:19-cv-23588; Southern Florida District]
Colson Hicks Eidson, P.A. (plaintiff)
Margol & Margol, P.A. (plaintiff)
Venable (defendant)

HAVANA DOCKS CORPORATION V. NORWEGIAN CRUISE LINE HOLDINGS, LTD. [1:19-cv-23591; Southern Florida District]
Colson Hicks Eidson, P.A. (plaintiff)
Margol & Margol, P.A. (plaintiff)
Hogan Lovells US LLP (defendant)

HAVANA DOCKS CORPORATION VS. ROYAL CARIBBEAN CRUISES, LTD. [1:19-cv-23590; Southern Florida District]
Colson Hicks Eidson, P.A. (plaintiff)
Margol & Margol, P.A. (plaintiff)
Holland & Knight (defendant)

MSC Of Switzerland May Purchase Global Ports Holding Of Turkey- Transaction Could Expose One To Lawsuit And The Other To More Assets For Plaintiffs To Seek In Libertad Act Title III Lawsuits.

Geneva, Switzerland-based Mediterranean Shipping Company (MSC); 2021 revenue approximately US$28.2 billion) is reported to be in discussions to purchase a majority shareholding in Istanbul, Turkey-based Global Ports Holding (2021 revenue approximately US$79.4 million).  NOTE: On 12 July 2022, MSC reported that it had terminated discussions with Global Ports Holding. No reasons were provided.

Global Ports Holding (2018 revenues exceeded US$124 million), which also has a registered office in London, United Kingdom, and is listed on the London Stock Exchange (LSE) could now be a defendant in a lawsuit relating to Title III of the Libertad Act of 1996 if Global Ports Holdings were to become a wholly-owned or partly-owned subsidiary of MSC.  

Global Ports Holding has “a management agreement in Cuba to advise and consult on cruise port management best practice. The cruise terminal is in the Sierra Maestra complex, in San Francisco pier, with a current capacity for two ships.” 

The Trump-Pence Administration (2017-2021) 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.   

Four separate lawsuits were filed on 2 May 2019 in United States District Court (Southern District of Florida- Miami Division) by Havana Docks Corporation against Carnival Corporation & plc; Royal Caribbean Cruise Lines; Norwegian Cruise Line Holding; and MSC Cruises SA Co and MSC Cruises (USA) Inc. 

The lawsuits claim that the four cruise lines were using (“trafficking”) assets upon which there is a certified claim (the passenger port located in the city of Havana) and the certified claimant has not received compensation from the Republic of Cuba.    

If MSC purchases a controlling interest in or absorbs completely Global Ports Holding, then Global Ports Holding could become a defendant in a Libertad Act Title III lawsuit filed by Havana Docks Corporation as assets connected to Global Ports Holding may become less problematic for a court to confirm jurisdiction due to the connectively with MSC which has operations in the United States and assets for plaintiffs to access to satisfy court verdicts and judgements. 

If MSC purchases a controlling interest in or absorbs completely Global Ports Holding, there may become additional assets controlled by MSC that plaintiffs in Libertad Act Title III lawsuits, for example Havana Docks Corporation and Odette Blanco De Fernandez, may seek to access to satisfy court verdicts and judgements if courts rule favorably in jurisdiction questions. 

Global Ports Holding From Turkey Could Be Next To Be Sued Using Title III; President Erdogan Will React Harshly- June 05, 2019 

HAVANA DOCKS CORPORATION VS. CARNIVAL CORPORATION D/B/A/ CARNIVAL CRUISE LINES [1:19-cv-21724; Southern Florida District]
Colson Hicks Eidson, P.A. (plaintiff)
Margol & Margol, P.A. (plaintiff)
Jones Walker (defendant)
Boies Schiller Flexner LLP (defendant)
Akerman (defendant)

HAVANA DOCKS CORPORATION V. MSC CRUISES SA CO, AND MSC CRUISES (USA) INC. [1:19-cv-23588; Southern Florida District]
Colson Hicks Eidson, P.A. (plaintiff)
Margol & Margol, P.A. (plaintiff)
Venable (defendant)

HAVANA DOCKS CORPORATION V. NORWEGIAN CRUISE LINE HOLDINGS, LTD. [1:19-cv-23591; Southern Florida District]
Colson Hicks Eidson, P.A. (plaintiff)
Margol & Margol, P.A. (plaintiff)
Hogan Lovells US LLP (defendant)

HAVANA DOCKS CORPORATION VS. ROYAL CARIBBEAN CRUISES, LTD. [1:19-cv-23590; Southern Florida District]
Colson Hicks Eidson, P.A. (plaintiff)
Margol & Margol, P.A. (plaintiff)
Holland & Knight (defendant)

ODETTE BLANCO DE FERNANDEZ née BLANCO ROSELL; EMMA RUTH BLANCO, in her personal capacity, and as Personal Representative of the ESTATE OF ALFREDO BLANCO ROSELL, JR; HEBE BLANCO MIYARES, in her personal capacity, and as Personal Representative of the ESTATE OF BYRON BLANCO ROSELL; SERGIO BLANCO DE LA TORRE, in his personal capacity, and as Administrator Ad Litem of the ESTATE OF ENRIQUE BLANCO ROSELL; EDUARDO BLANCO DE LA TORRE, as Administrator Ad Litem of the ESTATE OF FLORENTINO BLANCO ROSELL; LIANA MARIA BLANCO; SUSANNAH VALENTINA BLANCO; LYDIA BLANCO BONAFONTE; JACQUELINE M. DELGADO; BYRON BLANCO, JR.; MAGDELENA BLANCO MONTOTO; FLORENTINO BLANCO DE LA TORRE; JOSEPH E. BUSHMAN; CARLOS BLANCO DE LA TORRE; and GUILLERMO BLANCO DE LA TORRE; Plaintiffs, v. MSC MEDITERRANEAN SHIPPING COMPANY SA. [1:21-cv-23400; Florida Southern District]. Clerk Default Judgement Entered By Court On 1/25/22.
Horr, Novak & Skipp, P.A. (plaintiff)
Law Offices Of John S. Gaebe P.A. (plaintiff)
Berliner Corcoran & Rowe LLP (plaintiff)
Fields PLLC (plaintiff)
Arnold & Porter Kaye Scholer LLP (defendant)

LINK To Libertad Act Lawsuit Filing Statistics

The Maritime Executive
Fort Lauderdale, Florida
15 June 2022

MSC in Discussions to Buy Cruise Port Operator Global Ports
GPH operates cruise ports including Antigua in the Caribbean (file photo)

Global Ports Holding, an operator primarily of cruise ports around the world as well as some container terminals, confirmed media reports that it has been approached for takeover discussions by a division of MSC Mediterranean Shipping Company. The company said that its primary shareholder, a company controlled by Turkish businessman Mehmet Kutman, is in discussions with MSC. 

In a regulatory filing in London, the company reported they are exploring a potential cash offer for all of its shares. The value of the beleaguered company’s shares jumped nearly 20 percent based on the rumors prior to the regulatory filing. Kutman owns 62 percent of the shares outstanding in Global Ports. 

Founded in 2004, the company today promotes itself as the world’s largest cruise port operator. They currently have agreements for 26 ports in 14 countries ranging from the Mediterranean where they have a 29 percent market share, to Northern Europe, the Caribbean, and Asia. In 2022, they signed concessions for the port operations in Tarragona, Spain and Crotone, Italy as they work to rebound from the impact of the pandemic which caused strong declines in cruise and ferry passenger volumes. The company recently said it had returned to profitability after a two-year downturn.  Global Ports created a unique market position focusing on cruise ports, and positioning itself as the world’s leading cruise port brand, with an integrated network of cruise ports serving cruise ships, ferries, yachts, and mega-yachts. The company reports handling 1.5 million passengers annually with over 5,400 port calls. 

“These deliberations are at a preliminary stage and no decisions with respect to an offer have been made,” the company wrote in the filing. “There can be no certainty that an offer might ultimately be made for the company nor as to the terms on which any offer might be made.”  Under the rules, MSC now has till July 13 to “either announce a firm intention to make an offer,” or the company can announce that they do not intend to make an offer for GPH. The deadline, however, could be extended with the consent of the takeover panel. 

In addition to being the world’s largest container shipping line, MSC also operates a growing international cruise brand that is becoming one of the largest in the world. The controlling family of MSC recently also agreed to make a significant financial investment in the financially troubled Italian ferry operator Moby Lines. It was part of a restructuring of the company’s debt from the acquisition of another ferry operator Tirrenia di Navigazione nearly a decade ago. 

MSC has also been seeking to grow the logistics portion of its business. In April, MSC agreed to acquire the logistics operations of Bolloré Group, which operates in 47 African countries with 16 container terminals. MSC beat out other major shipping companies to acquire the assets of Bolloré in a deal valued at $6.4 billion. MSC reported it would strengthen its commitment to Africa and expand access for the continent in the global markets.

Agricultural Commodity-Focused Delegation From Maine Visits Cuba. Will Cuba Import Fish From Maine?

National Fisherman
Portland, Maine
13 June 2022

Maine's fisheries and agricultural delegation meets with buyers in Cuba

By Jose Antunes 

On the photograph that illustrates this story, Maine agricultural delegates display a Maine State Flag at the Monument to the Victims of the USS Maine on the Malecón Boulevard in Havana, Cuba. The group met with Cuban buyers and high-level government officials to develop a new trade pipeline of agricultural and fisheries products from Maine to Cuba. 

Pictured are (l-r) Joshua Miller, Johnny’s Selected Seeds; Suzannah Raber, New England Fish Co.; Stephanie Cheney Marchant, Cedar Spring Agricultural Co; Mrs. Ramiro Triana Abreu; Doyle Marchant, Cedar Spring Agricultural Co.; Ramiro Triana Abreu, Cedar Spring Agricultural Co.; Phineas Sprague, Jr., Portland Yacht Services.  

Representatives of Maine's fisheries, apples, seed potatoes and vegetable seeds traveled to explore export opportunities in Cuba. After a first visit in May, an expanded delegation will return in October. 

Those delegates from Maine agricultural growers and fisheries met with buyers and officials from the Cuba Ministry of Agriculture (MINAG) to develop a pipeline of Maine agricultural products for export to Cuba. 

The delegation was developed by Doyle Marchant, president of Cedar Spring Agricultural Co., at the direct invitation of the Cuba Ministry of Agriculture (MINAG). 

"It was important for Maine growers and producers to act on this unique invitation for Maine to build a reliable source of products and begin a normalization of relations between the two countries," said Marchant. "The primary currency in Cuba is not money but building trust that can benefit both Maine and Cuba." 

While in Havana, letters of support for the delegation from Maine lawmakers Sen. Susan Collins, Rep. Chellie Pingree, and Rep. Jared Golden were presented to Sr. Carlos Fernandez de Cossio, vice minister of Ministry of Foreign Relations for the Republic of Cuba. The meetings also coincided with an important announcement by the Biden administration to lift certain restrictions on Cuba. 

Maine products from the sea and the fields 

The delegates were assembled to represent key agricultural industries from Maine, including frozen fish products, apples, seed potatoes and vegetable seeds. Maine fisheries delegates met with buyers to introduce a novel species of fish to Cuba, Cape Shark – known to U.S fisheermen as spiny dogfish –which provides a provide a tasty source of inexpensive protein, as well as other frozen fish products. 

Marchant, told National Fisherman that “the fisheries portion of the delegation was formed to present the Cape Shark as a potential high-protein, low cost fish for Cuba. Developing this species for export expands the fishery for Maine coastal fishermen, processors and cold storage facilities. The Cape Shark can be shipped as processed loins or as minimally-processed whole fish to provide food and allow for processing the by-products in Cuba into fertilizer for crops.” 

Vegetable seeds and seed potatoes were presented to MINAG officials to help Cuba develop a more self-sufficient agricultural system. Maine apples were proposed to provide nourishment to Cuba which has been hit hard by the pandemic and trade restrictions. 

Phineas Sprague Jr., founder of Portland Yacht Services, Inc., served as advisor to Cedar Spring Agricultural Co. Sprague provided invaluable guidance in selecting the team of fisheries delegates to represent the full scope of introducing Maine fish products to Cuba, from landing, processing, freezing and storage. Cedar Spring Agricultural also relied upon its partner Ramiro Triana Abreu in Havana to assist in Cuba to coordinate high-level meetings during the delegation visit. 

Delegates included: Joshua Miller, International /Wholesale Territory Manager, Johnny’s Selected Seeds; Suzannah Raber, Sales & Operations Manager, New England Fish Co.; Angelo Ciocco, President, Nova Seafood; Robert Odlin, Owner, Odlin Family Seafood/ Sea Method Fertilizer; Stephanie Cheney Marchant, Vice President, Cedar Spring Agricultural Co., representing Ricker Hill Farms. 

Reconfirming a Maine-Cuba relationship 

Spanning more than two decades, Marchant has a long history of working to bring Maine products to Cuba. This May 2022 effort has taken on special significance considering the devastating impact the covid-19 pandemic had on the Cuban economy. 

Heavily dependent on tourist trade, the Cuban economy came to a nearly complete halt. As a result, the government has initiated new steps to develop a more self-sustaining economy. 

“Our mission to reinvigorate the links between Maine and Cuba through agricultural and fisheries exports,” said Marchant, “is one that will benefit the growers and producers of Maine and the people of Cuba.” 

An expanded delegation plans to return Oct. 8 to resume negotiations for Maine agricultural and fisheries products. 

“The expanded delegation in October will include representatives in the forest products and livestock medical products industries. At this time, Maine fisheries are well represented for the October delegation,” said Marchant.

Remittances To Cuba Mentioned 16 Times In 14 Pages Of New OFAC Regulations: Biden, Blinken, Sullivan, Nichols, Gonzalez, Yellen Defend 3rd-Country Banks Taking Percentage Of Every Dollar To/From Cuba

Remittances Mentioned 16 Times In 14 Pages Of New OFAC Cuba Regulations.  So Why Do Messrs. Biden, Blinken, Sullivan, Nichols, Gonzalez, And Ms. Yellen Endorse And Require Third-Country Banks To Receive A Percentage Of Payments Companies Receive From Cuba And Payments Companies Send To Cuba?  How Does This Benefit Cuba’s Entrepreneurs?

OFAC Regulations Are Not Useful If They Are Impractical
One-Way Banking Is Authorized
Two-Way Banking Should Not Be A “Tilting At Windmill” Moment

Merriam-Webster Dictionary- “tilt at windmills”
Definition: to use time and energy to attack an enemy or problem that is not real or important
The wind does not always blow in one direction… so the only wasted effort is an effort not made.

What do these officials have in common? Joseph Biden-President of the United States, Antony Blinken- United States Secretary of State, Janet Yellen- United States Secretary of the Treasury, Jacob Sullivan- Assistant to the President for National Security Affairs, Brian Nichols- Assistant Secretary of State for Western Hemisphere Affairs, and Juan Gonzalez- Senior Director for Western Hemisphere Affairs at the National Security Council in The White House.  

• They believe funds from the Republic of Cuba to pay United States exporters of agricultural commodities, food products, and healthcare products should be a profit center for financial institutions in third countries. 

• They believe funds from the United States in the form of remittances, telecommunications payments, overflight payments, aircraft landing fees, and payments for authorized travel purposes should be a profit center for financial institutions in third countries.  

There can be a collective “courage of ignorance” excuse for the five men- none of whom have a professional background in finance, but have spent considerable time on the United States government payroll.  However, no excuse from the lone woman- who is a former chair of the United States Federal Reserve, former member of the United States Federal Reserve, president of the Federal Reserve Bank of San Francisco, chair of The White House Council of Economic Advisors, and holder of a PhD in economics from Yale University.   

Would these six individuals be comfortable with their bi-weekly payroll check issued by the United States Department of the Treasury having first to clear through a financial institution located in Canada, France, or Mexico before making its way into their personal checking account?  Oh, and that financial institution in Canada, France, or Mexico would take a commission.  Comfortable? 

On 8 June 2022, the Biden-Harris Administration (2021- ) published revised and new Republic of Cuba-related regulations by the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury.  The Bureau of Industry and Security (BIS) of the United States Department of Commerce has yet to publish guidance. LINK To OFAC Regulations 

The word “remittances” was referenced sixteen times in the fourteen-page text of the revised and new OFAC Cuba Regulations. 

Highlighting the importance of remittances is commendable- and important.  Failing to provide for straight-line cost-effective efficient delivery of remittances and straight-line cost-effective efficient delivery of payments to the United States from the Republic of Cuba is condemnable- and important.  Both are essential to support, promote, and engage- as the Biden-Harris Administration professes to want, with the self-employed and re-emerging micro, small, and medium-sized enterprises (MSMEs) in the Republic of Cuba.     

The Biden-Harris Administration had an opportunity to make what it promoted be also useable.  Would the OFAC regulations not only authorize a transaction, an activity, but provide a regulatory landscape to enable individuals and companies subject to United States jurisdiction to engage in the transaction and participate in the activity?  

Are the regulations issued by the OFAC useful and practical.  Are they written in such a manner that individuals will not understand them and legal counsel at companies will understand them and decide that the supposed opportunities presented are not implementable.  Are the regulations a lay person’s nightmare and an attorney’s income stream? 

There were considerable political pressures directed toward The White House for the Biden-Harris Administration to talk big, but craft a short leash.  To some constituencies present that many opportunities exist.  To other constituencies present that the changes and revisions are no big deal, nothing to see here; don’t lose any sleep.    

The fear was the Biden-Harris Administration would succumb to publishing “feal good” regulations where The White House and the United States Department of State will expound upon all of the new means of engagement- but in practical terms what is included and what is left out make implementation so cumbersome, so in need of compliance measures, that value to the supposed beneficiaries- in the case of the re-emerging MSMEs in the Republic of Cuba, are absent.  

The Biden-Harris Administration did importantly include in the new and revised OFAC regulations a focus upon funding support for MSMEs.  The Biden-Harris Administration did under a separate specific license authorize the first direct equity investment in and the first direct financing to a MSME. 

Unfortunately, there remains distance from stated intention and practical implementation.  Taking credit for permitting what is not practically implementable has resurfaced a theme from the past and the fear that derived from it. 

The fear was justified as some of the individuals within the Biden-Harris Administration, those who are political appointees and those who are careerists, have in common employment during the Obama-Biden Administration (2009-2017) and particularly the period from 17 December 2014 when the re-establishment of formal diplomatic relations was announced to 20 January 2017 when the Trump-Pence Administration (2017-2021) arrived to The White House. 

It was these individuals who in 2015 presented to the public as a valuable, viable, tool of engagement from the OFAC that a financial institution subject to United States jurisdiction was authorized to establish an account in the Republic of Cuba with a Republic of Cuba government-operated financial institution.  

That was the good news. 

In the next paragraph from the OFAC was the statement that Republic of Cuba government-operated financial institutions would not be permitted to establish an account with a financial institution subject to United States jurisdiction. 

That was the bad news. 

Add the good news to the bad news and the result was an unusable opportunity.  Not insignificant to note that prior to the publication of regulations for Direct Correspondent Banking, the individuals responsible for crafting the regulation were advised that absent two-way transactions, Direct Correspondent Banking would not be operational.  The “opportunity” would in reality be a fraud because known in advance that the “opportunity” was not implementable. 

From OFAC Frequently Asked Questions 

744. May correspondent accounts authorized pursuant to 31 CFR § 515.584(a) or used for transactions authorized by 31 CFR § 515.584(g) be established and maintained in U.S. dollars?   

• Yes. Correspondent accounts of depository institutions (as defined in 31 CFR § 515.333) at a financial institution that is a national of Cuba authorized pursuant to § 515.584(a) may be established and maintained in U.S. dollars. Such accounts may be used only for transactions that are authorized by or exempt from the CACR. Transactions necessary to establish and maintain such correspondent accounts —– such as originating, processing, and terminating authorized funds transfers in U.S. dollars —– are authorized. 

• Additionally, correspondent accounts used for transactions authorized by 31 CFR § 515.584(g), which permits banking institutions as defined in 31 CFR § 515.314(g) that are persons subject to U.S. jurisdiction to accept, process, and give credit to U.S. dollar monetary instruments presented indirectly by a financial institution that is a national of Cuba, may be denominated in U.S. dollars. 

• However, financial institutions that are nationals of Cuba remain prohibited from opening correspondent accounts at a U.S. financial institution. For a complete description of what these general licenses authorize and the restrictions that apply, see 31 CFR § 515.584(a) and (g). § 515.584 Certain financial transactions involving Cuba. 

• Correspondent accounts. Depository institutions, as defined in § 515.333, are authorized to engage in all transactions necessary to establish and maintain correspondent accounts at a financial institution that is a national of Cuba, provided that such accounts are used only for transactions authorized pursuant to, or exempt from, this part.  

• (g) Any banking institution, as defined in § 515.314, that is a person subject to U.S. jurisdiction is authorized to accept, process, and give value to U.S. dollar monetary instruments presented for processing and payment by a banking institution located in a third country that is not a person subject to U.S. jurisdiction or a Cuban national and that has received the U.S. dollar monetary instruments from a financial institution that is a national of Cuba for which it maintains a correspondent account and which received the U.S. dollar monetary instruments in connection with an underlying transaction that is authorized, exempt, or otherwise not prohibited by this part, such as dollars spent in Cuba by authorized travelers or a third-country transaction that is not prohibited by this part.  Note to paragraph (g): Correspondent accounts used for transactions authorized pursuant to § 515.584(g) may be denominated in U.S. dollars. 

If another definition for disingenuous is sought, then what the Obama-Biden Administration did in 2015 was then and remains today for the Biden-Harris Administration a terrific example. 

In 2015, Pompano Beach, Florida-based Stonegate Bank (2017 assets approximately US$2.9 billion) was vetted by the OFAC and approved for a correspondent banking relationship with Banco Internacional de Comercia SA (BICSA), a member of Republic of Cuba government-operated Grupo Nuevo Banca SA, created by Corporate Charter No. 49 in 1993 and commenced operation in 1994.  In 2017, Conway, Arkansas-based Home BancShares (2020 assets approximately US$16 billion) through its subsidiary Centennial Bank purchased Stonegate Bank.   

According to the Republic of Cuba, “Its [BICSA] main activity is ‘enterprises’ bank’ carried through its central services and five branches based in the country’s capital, Santiago de Cuba and Villa Clara. It records all transactions in real time providing its customers with card and remote banking services while it is working on developing other methods of electronic banking.  Its institutional clients, national or foreign, receive a complete accounting and documentary service, while national entities also enjoy of significant volumes of credit facilities. Practically all sectors of the economy benefit from all this, such as that of agriculture, the food industry, the basic and light industries, transportation, aviation, fishing, construction, domestic and foreign trade, the iron and steel industry, sugar, informatics, communications and others with not only economic importance but also social, such as health, water supply, education, culture and sports.  Credit policy followed by the Bank is dictated in a collegiate way by its Credit Committee on the basis of a strict analysis and control in loan making.  The Bank counts on correspondents in the five continents, the majority are first class banks, mainly Europeans and Americans.  Equity capital of shareholders (Grupo Nueva Banca with the biggest share and Bancholding), near the USD95 millions with a balance ranging from 550 to 600 millions, make sure the Bank has a strong solvency ratio.” 

Stonegate Bank provided commercial operating accounts for the Embassy of the Republic of Cuba in Washington, DC, and the Permanent Mission of the Republic of Cuba to the United Nations in New York City, New York; and other types of OFAC-authorized and BIS-authorized transactions. 

Without explanation the Obama Administration did not authorize BICSA under a license from the OFAC to have an account at Stonegate Bank, so Stonegate Bank routed transactions for approximately eighty (80) customers on a regular basis through Panama City, Panama-based Multibank (2019 assets approximately US$5 billion) which had dealings with the Republic of Cuba. 

However, on 16 June 2020, Bogota, Colombia-based Grupo Aval (2020 assets approximately US$79 billion) reported that “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.” 

Absent Direct Correspondent Banking, authorized transactions from the Republic of Cuba to the United States are multi-day rather than less than multi-hour and third parties earn unnecessary fees.   

By United States law and by regulation, the implementation of Direct Correspondent Banking requires transparency by the participating United States-based financial institution and transparency by the non-United States-based financial institution.  Direct Correspondent Banking activity must comply with regulations of the Financial Crimes Enforcement Network (FinCEN) of the United States Department of the Treasury and provisions of the 2001 USA Patriot Act.  

If the Republic of Cuba accepts Direct Correspondent Banking, a result will be an increased transparency, accountability and efficiency for financial institution operations within in the Republic of Cuba.  This benefits the [Miguel] Diaz-Canel Administration (2018- ) in the city of Havana and the Biden-Harris Administration in Washington DC.  

This is the result of the Direct Correspondent Banking decision by the Obama-Biden Administration which has since continued during the Biden-Harris Administration: Since December 2001, the approximately US$6.7 billion in payments from the Republic of Cuba to the United States for agricultural commodities, food products, and healthcare products exports to the Republic of Cuba; and all payments from the United States to the Republic of Cuba for electronic remittances, Airbnb-related, authorized travel, overflights, artwork, have flowed through a third country before reaching the bank accounts of United States companies. 

For perspective, since the Cuban Democracy Act (CDA) became effective in October 1992, the Trade Sanctions Reform and Export Enhancement Act (TSREEA) became effective in October 2000, and the OFAC, the BIS and the United States Department of State have authorized  other transactions, more than US$6.7 billion in payments for agricultural equipment, construction equipment, agricultural commodities, food products, medical equipment, medical instruments, medical supplies, pharmaceuticals, healthcare products, and travel-related services (including airline landing fees, telecommunications, etc.) have been subject to a triangular process through financial institutions located in third countries and then to United States financial institutions.   

A financial institution located in Canada, Mexico, Panama, France, Spain, among other countries receive a fee to move funds that they had nothing to do with generating. 

Banks in third-countries have been winning a multi-million dollar payment lottery every month for thirty (30) years. 

Direct Correspondent Banking far more benefits United States exporters than it does Republic of Cuba-based importers.  Direct Correspondent Banking means less time for United States exporters to be paid and less cost to receive those payments. 

Enabling Direct Correspondent Banking would be one immensely significant decision by the Biden Administration as it would benefit authorized commercial transactions and compel Republic of Cuba government-operated financial institutions to be transparent and comply with United States regulations, resulting in greater confidence towards the Republic of Cuba and increased accountability by the Republic of Cuba. 

According to one senior-level executive of a New York, New York-based financial institution, "banks in other countries have been lottery winners since December 2001; I'm confident the Biden [-Harris] Administration appreciates that United States farmers should not have to give-up anything in order to export their products.  The Obama Administration could have, should have done something.  They didn't.  Now, the Biden Administration can right that wrong and authorize direct correspondent banking transactions."       

The Obama-Biden Administration did and the Biden-Harris Administration continues to perpetuate this United States government-mandated theft of funds that if removed could be used to increase exports from the United States to the Republic of Cuba. 

“Which is why I’m proud to say: If you look at my presidency so far, it’s a jobs presidency and it’s a small business presidency.”  Joseph Biden 

“But Cuba is not represented solely by its leadership. There are many different sectors that we can and should work with to support progress in Cuba- including entrepreneurs, religious groups, universities, young people and human rights defenders.”  Joseph Biden 

“The United States recommits to accompanying the Cuban people in your quest to determine your own future.  We will support those improving the lives of families and workers, cuentapropistas who have forged their own economic paths, and all who are building a better Cuba- and a better tomorrow for themselves in Cuba.”  Antony Blinken  

For Joseph Biden, the self-anointed “Small Business President” of the United States, will if he does not change the current OFAC regulations to authorize Direct Correspondent Banking, be more appropriately referred to as the “Small Business Impediment President” of the United States. 

The Biden-Harris Administration should not only authorize a transaction, an activity, but provide a regulatory landscape that will enable individuals and companies subject to United States jurisdiction to use what is authorized.  Absent this usability, the government of the Republic of Cuba will again be on the offense rather than the defense.   

The United States government should always be ahead of what the government of the Republic of Cuba permits its entrepreneurs to do…. Always.  

If the re-emerging private sectors in the Republic of Cuba are to benefit meaningfully it is critical that individuals subject to United States jurisdiction visiting the Republic of Cuba put money into privately-owned restaurants, arts and crafts workshops, dance studios, beauty salons, performing musicians, taxis, etc.   

Authorizing Direct Correspondent Banking is a key component to assist entrepreneurs in the Republic of Cuba to benefit from engagement with sources of inputs, investment, and financing located throughout the United States.   

Given the hope and vocal support the Biden-Harris Administration has invested in Republic of Cuba’s entrepreneurs, it would be an epic policy failure amounting to betrayal to deprive those entrepreneurs with a direct, efficient, and cost-effective means of receiving and sending funds- particularly from the newly-authorized sources of direct equity investment and direct financing, courtesy of the Biden-Harris Administration.   

Make the tools available in the new OFAC regulations be useful and inspirational, not just wishful. 

LINK TO COMPLETE ANALYSIS IN PDF FORMAT

Cuba Continues To Process Implementation Issues With MSMEs- Important Quickly For Regulations Authorizing Direct Equity Investment And Direct Financing From Abroad

Prensa Latina News Agency
Havana, Republic of Cuba
10 June 2022

Debate in Economic Conference experiences of MSMEs in Cuba

Havana, Jun 10 (Prensa Latina) Nine months after authorizing the creation of micro, small and medium-sized enterprises (MSMEs) in Cuba, today there is progress in the inclusion of these economic actors in society, but difficulties remain to be solved.

Published by: Elsy Fors Garzon

Within the framework of the II Productive Economic Conference Cuba 2022, the Tryp Habana Libre hotel held the Workshop Approaching MSMEs, a space to exchange experiences during this period from different angles.

Among the issues addressed by the panelists are the fissures in the legislation and the importance of adapting it to the needs of the parties, as well as the inclusion of elements that were not taken into account at the beginning of the process and others that arise as a consequence of its evolution.

Data of interest was the look at MSMEs from a gender perspective, only 25 percent of these projects are led by women, and in the opinion of the experts this is due, in part, to the role of women as caregivers and responsible for the home.

Other difficulties identified are the absence of a business ecosystem adapted to the new circumstances, the current economic situation and the obstacles to purchasing products in freely convertible currency as there is no effective state mechanism for the purchase of that currency, as well as misunderstandings by organisms. This exercise to identify the weaknesses of the process is part of the search for solutions to achieve the real and effective integration of all forms of management -whether state or private- and in this way link the entire productive fabric of society to achieve greater development. .

From another perspective, the Scientific and Technological Park of Havana is an example of the benefits of articulating an innovation ecosystem for the execution of R&D projects that impact value chains and generate new products and services.

In this session of the II Productive Economic Conference Cuba 2022 -until June 14- there was also a space for the exchange between delegates and authorities of the Ministries of Domestic Trade and the Food Industry on the island.

U.S. Agricultural Commodity/Food Product Exports To Cuba Decrease 43.7% In April 2022; Lower By 5.1% Year-To-Year

ECONOMIC EYE ON CUBA©
June 2022

April 2022 Food/Ag Exports To Cuba Decrease 43.7%- 1
59th Of 218 April 2022 U.S. Food/Ag Export Markets- 2
2022 Exports Decrease 5.1%- 2
Cuba Ranked 53rd Of U.S. Ag/Food Export Markets- 2
April 2022 Healthcare Product Exports US$00.00- 2
April 2022 Humanitarian Donations US$941,576.00- 3
Obama Administration Initiatives Exports Continue- 3
U.S. Port Export Data- 16

APRIL 2022 FOOD/AG EXPORTS TO CUBA DECREASE 43.7%- Exports of food products and agricultural commodities from the United States to the Republic of Cuba in April 2022 were US$18,089,515.00 compared to US$32,133,008.00 in April 2021 and US$11,569,079.00 in April 2020.

January 2022 to April 2022 exports were US$95,614,669.00 compared to January 2021 to April 2021 exports of US$100,837,122.00.

April 2022 Exports Included: Chicken Leg Quarters (Frozen); Chicken Meat (Frozen); Chicken Legs (Frozen); Woodpulp; Shampoos; Preparations For Use On The Hair; Soap.

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.

Click here for a list of agricultural commodities eligible for export to Cuba under Section 902(1) of the Trade Sanctions Reform and Export Enhancement Act of 2000

Complete Report In PDF Format

After 495-Day "Cuba Policy Review" OFAC Issues New And Revised Regulations For Cuba Transactions

United States Department of the Treasury
Office of Foreign Assets Control
Washington DC
8 June 2022

31 CFR Part 515
Cuban Assets Control Regulations
AGENCY: Office of Foreign Assets Control, Treasury.
ACTION: Final rule.
SUMMARY: The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is
amending the Cuban Assets Control Regulations to implement elements of the policy announced
by the Administration on May 16, 2022 to increase support for the Cuban people. This rule
authorizes group people-to-people educational travel to Cuba and removes certain restrictions on
authorized academic educational activities, authorizes travel to attend or organize professional
meetings or conferences in Cuba, removes the $1,000 quarterly limit on family remittances, and
authorizes donative remittances to Cuba. These amendments also add or update several cross
references.

LINK To Regulations

LINK To Federal Register Publication

Members Of U.S. Congress: We Were For Entrepreneurs In Cuba Before We Were Against Them. When Biden Administration Permitted Investment/Financing To Entrepreneurs, Entrepreneurs No Longer Exist

Yes, This Is True.
Members Of The United States Congress: “We Were For Entrepreneurs In Cuba Before We Were Against Them.”
Once The Biden-Harris Administration Permitted Investment/Financing To Entrepreneurs, Entrepreneurs No Longer Exist.

Prior to 10 May 2022, members of the 117th United States Congress, including those of Cuban descent, accepted that entrepreneurs existed in the Republic of Cuba and supported the role of entrepreneurs in the Republic of Cuba: the self-employed (cuentapropista) whose resurrection was re-authorized in 1993 and micro, small and medium-size enterprises (MSMEs) along with the adoption of the Limited Liability Company (LLC) structure authorized in 2021 by the government of the Republic of Cuba.  Entrepreneurs from the Republic of Cuba were invited to visit with members of the United States Congress, were invited to hearings held by committees/sub-committees of the United States Congress, and were invited to academic and commercial gatherings hosted by individuals of Cuban descent in the United States. 

Individuals identifying as of Cuban descent in the 117th United States Congress- United States Senate: The Honorable Ted Cruz (R- Texas); The Honorable Marco Rubio (R- Florida); The Honorable Robert Menendez (D- New Jersey).  United States House of Representatives: The Honorable Albio Sires (New Jersey; D- 8th- Retiring); The Honorable Alex Mooney (West Virginia; R-2nd); The Honorable Anthony E. González (Ohio; R- 16th- Retiring); The Honorable Mario Díaz-Balart (Florida; R-25th); The Honorable Carlos Gimenez (Florida; R- 26th); The Honorable Maria Elvira Salazar (Florida; R- 27th); The Honorable Nicole Malliotakis (New York; R- 11th). 

On 11 May 2022, some of these same members of the United States Congress, along with others, not only disavowed their support for entrepreneurs in the Republic of Cuba, but they also disputed the existence of entrepreneurs in the Republic of Cuba. 

To paraphrase, reminiscent of a statement from a politician: “I supported them before I was against them.”  Drenching with hypocrisy. 

Why the change in attitude?  Because prior to 10 May 2022 the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury did neither authorize direct equity investment in nor direct financing to a company owned by a Republic of Cuba national.  To remind, the license issued by the OFAC on 10 May 2022 is for an LLC created by an individual subject to United States jurisdiction to use personal funds- this is not about United States taxpayer funds as some critics have referenced.  The license represents an opportunity for a personal risk.  A choice. 

Permitted prior to 10 May 2022 the OFAC authorized the delivery of remittances to the Republic of Cuba in the form of gifts.  The primary sourcing of these gifts were individuals of Cuban descent residing in the State of Florida and State of New Jersey, the locations with the largest populations in the United States of individuals of Cuban descent. 

What if the license issued by the OFAC on 10 May 2022 had been the result of an application submitted on 10 June 2021 by an individual of Cuban decent residing in the State of Florida or State of New Jersey for the purpose of delivering direct equity investment and direct financing to a friend or relative residing in the Republic of Cuba?  Would this have provided the license with necessary political purity?

For at least some of the members of the United States Congress and supportive critics outside of the political arena, a lack of “Cuban-American” participation in the license application and in the resulting license is precisely their problem- and some have said so.   

They adhere to a philosophy which espouses any commercial, economic, and political engagement with the current government of the Republic of Cuba is first their exclusive fiefdom and second this exclusivity naturally includes an absolute right to approve and disapprove any statutory, regulatory, and policy change by the United States government. 

What also seems anathema to some members of the United States Congress is their objection to formalizing, publicizing, providing legitimacy, legality to what is happening- funds (often currency in envelopes) are delivered from the United States to the Republic of Cuba to families and friends for the purpose of supporting entrepreneurial activities.   

So, the rationale is this: continue permitting what isn’t allowed is fine; officially authorizing what isn’t allowed is “surrendering to the regime.” 

The Ministry of Economy and Planning (MEP) of the Republic of Cuba has reported that since the MSME/LLC structures were authorized in 2021, there are today 3,552 private MSMEs and more than 53 non-agricultural cooperatives.  Fifty-five percent of the more than 3,500 were conversions from previously-authorized business structures to new structures including the use of the LLC.

Current statutes and regulations in the Republic of Cuba do not specifically authorize MSME “members” who are not permanent residents in the Republic of Cuba.  Current statutes and regulations do authorize an MSME to have connectivity with non-Republic of Cuba-based companies.  Until there is a specific statutory and regulatory change, direct equity investment into an MSME may need be processed through the same evaluation mechanism as is direct equity investment into an entity affiliated with the government of the Republic of Cuba. 

As to questions about the mechanism for an equity investor in a MSME receiving profit distributions and for a financing source receiving interest and principle payments, that is solely a decision of the investor, financier, and MSME based upon statutes and regulations.  There is a risk, the acceptable level of which is for the investor and financing source to determine.   

Which leaves entrepreneurs residing in the Republic of Cuba where?  First, they have vanished from the lexicon.  When they were recipients only of gifts from family and friends, they were defined as an army forward deployed against the government of the Republic of Cuba.  Their goal was to wrestle control of their lives from the grip of the government of the Republic of Cuba.  They were on the front lines, in the fox holes.  They were applauded for swimming against the tide. 

Their restaurants (paladares), Airbnb-registered properties (casas particulares), Internet applications, fashion designers, beauty salons, vehicle repair shops, artist studios were, among thousands of other operational categories prior to 10 May 2022, beacons of hope and engines for prosperity. 

But that all changed on 11 May 2022.  Now these same individuals- and their employees, were nothing.  Well, not quite nothing.  They were now complicate with the government of the Republic of Cuba- in part responsible for the status quo rather than a catalyst for change.  All of them existed solely because they had friends and family connected with the government of the Republic of Cuba, Communist Party of the Republic of Cuba, or Revolutionary Armed Forces of the Republic of Cuba.  They were now actors in a play first appearing on 1 January 1959 and since running twenty-four hours a day, seven days a week, for 23,012 consecutive performances. 

So, what to make of this support for support until the support becomes available for anyone and becomes transparent for all to see? 

Critics of authorizing direct equity investment in and direct financing to a privately-owned business in the Republic of Cuba are co-conspirators with the government of the Republic of Cuba to limit the role of the re-emerging private sector in the Republic of Cuba. 

One cannot legitimately promote their support for entrepreneurs in the Republic of Cuba and then provide no means to do so.  Does support for entrepreneurs in the Republic of Cuba mean letting them rot?  Is this the tough-love strategy? 

The re-emerging private sector will not receive the oxygen (equity investment and financing) it requires to transition from being a child needing support (gifting) of a parent to being an adult determining his/her destiny through the support of a national and international equity and financing constituency.   

Would critics prefer those individuals in the Republic of Cuba who were entrepreneurs prior to 10 May 2022 seek their equity investment and financing from a Republic of Cuba government-operated financial institution?  Seek their equity investment and financing from a financial institution located outside of the United States?  Or, purchase an airline ticket, travel to the United States, and remain there?   

Critics of the decision by the Biden-Harris Administration (2021- ) to direct the OFAC to energize opportunities for engagement with the re-emerging private sector in the Republic of Cuba should be applauding rather than excoriating the initiative to seek the license and then the issuance of the license. 

For the United States government, the decision of choice was and remains clear:  Be an enabler, a guide, a savior to the re-emerging private sector in the Republic of Cuba or by absence be a co-conspirator with the government of the Republic of Cuba.  

To paraphrase, reminiscent of a statement from a politician:  “You didn’t build that… because you can’t build what does not exist and because you do not exist.” 

Soon there will be an individual of Cuban descent who creates a company in the Republic of Cuba, builds it, installs a management team, and then uses that experience and profits to visit the United States and replicate his/her success in the United States.  That’s the type of competition everyone should embrace.  That’s the type of entrepreneurship everyone should embrace.  Critics don’t need use the term entrepreneur; they can use the word risk-taker.

COMPLETE ANALYSIS IN PDF FORMAT

LINKS To Related Posts

Response To A Washington Times Editorial From Those Criticized And On Behalf Of Those Criticized. May 26, 2022

Replying To A Wall Street Journal Editorial From Those Who Were Attacked And On Behalf Of Those Who Were Attacked. May 22, 2022

With U.S. Government Authorization For First Direct Equity Investment Into A Private Company In Cuba, Here Is Important Context And Details. About The Parties; About The Message. May 16, 2022

Biden-Harris Administration Approves First Equity Investment Since 1960 In A Private Cuban Company May 10, 2022

Female Cuban Entrepreneurs Expand Their Clothing Company To Spain; Already In U.S.. Members Of U.S. Congress Believe Cuban Entrepreneurs Don't Exist. Regardless, They Are Dangerous.

From CUBA STANDARD (1 June 2022)- Havana-based fashion label Clandestina opened an e-commerce website catering to European customers, with fulfillment and shipping done from Madrid. Run by thirty-somethings Leire Fernández and Idania del Río, the private business is known for its tongue-in-cheek marketing. True to style, the bilingual website offers instructions in Spanish and Basque to its European buyers. “We suspect you will like it”, the company said in announcing the new e-commerce platform.

The Clandestina team

Clandestina has been operating a similar website for the U.S. market since 2017. Circumventing U.S. sanctions, t-shirts ordered through Clandestina.co were made, stored and shipped within the United States, the company said when it opened the website. The company also runs a website for domestic online sales, clandestinaencasa.com. The operations of that site were disrupted temporarily at the beginning of the pandemic in 2020 when the U.S. company whose software ran the e-commerce platform of the website bailed out with no warning.

The business has IT friends in high places, though. In 2018, Clandestina launched a new clothing line with support from Google, “to celebrate the increasing opportunities and improving connectivity in Cuba”. The collection was titled País en Construcción, or Country Under Construction. “Clandestina has always been at the forefront of what’s possible,” said Susanna Kohly Jacobson, Google Cuba’s head of marketing, at the time.

The Google Chrome T-Rex icon, which pops up when there is no Internet connection, has been a frequent feature on Clandestina products.

“We’re excited about what increased connectivity means for our team, and for Cuba,” said Del Río, “but it also means we’re spending more time online and seeing our T-Rex friend less and less.”

LINKS To Related Posts

Response To A Washington Times Editorial From Those Criticized And On Behalf Of Those Criticized. May 26, 2022

Replying To A Wall Street Journal Editorial From Those Who Were Attacked And On Behalf Of Those Who Were Attacked. May 22, 2022

With U.S. Government Authorization For First Direct Equity Investment Into A Private Company In Cuba, Here Is Important Context And Details. About The Parties; About The Message. May 16, 2022

Biden-Harris Administration Approves First Equity Investment Since 1960 In A Private Cuban Company May 10, 2022