Written by Shari R. Pogach, Regulatory Paralegal
One of the biggest news stories to hit the airwaves recently was that of President Obama’s announcement of major changes in U.S. policy with respect to Cuba. The key elements of the executive actions to re-frame U.S. relations with Cuba concern: 1) re-establishing diplomatic relations, including re-establishing an embassy in Havana; 2) easing the regulatory hurdles to travel to Cuba; and 3) expanding and authorizing trade and financing. Financial institutions can expect changes in two areas as a result of the policy changes, remittances and correspondent accounts.
Remittance levels will be raised from $500 to $2,000 every three months for general remittances to Cuban nationals (excluding certain officials of the government or the Communist party). Remittance forwarders, as well as donations for humanitarian projects or private businesses, will no longer require a specific license.
U.S. financial institutions will be permitted to open correspondent accounts at Cuban financial institutions to facilitate the processing of authorized transactions.
The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) has an entire webpage dedicated to Cuba sanctions with a number of resources including a reference brochure overview of Cuba sanctions. OFAC has actually posted an FAQ concerning implementation of the policy change:
“Q. How will OFAC implement the changes to the Cuba sanctions program announced by the President on December 17, 2014? Are the changes effective immediately?
A. OFAC will implement the Treasury-specific changes via amendments to its Cuban Assets Control Regulations. The Department of Commerce will implement the remainder of the changes via amendments to its Export Administration Regulations. OFAC expects to issue its regulatory amendments in the coming weeks. None of the announced changes takes effect until the new regulations are issued.”
In addition, anyone looking for email updates on Cuba sanctions can sign-up here.