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Commerce Tightens Export Controls For Cuba

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Commerce Tightens Export Controls For Cuba

The Trump administration has further restricted the Cuban government's access to commercial aircraft and vessels and other U.S. exports. 

The regulatory actions, announced by the Commerce Department's Bureau of Industry and Security (BIS) in an Oct. 21 Federal Register notice, are a response to Cuba's continued financial and military support of Venezuela's Maduro regime and follow President Trump's June 16, 2017, changes to toughen U.S. policy toward Cuba, according to the administration.

"This action by the Commerce Department sends another clear message to the Cuban regime – that they must immediately cease their destructive behavior at home and abroad," Commerce Secretary Wilbur Ross said in a statement.

The latest BIS regulations aim to halt current and future leases of aircraft and vessels to Cuban state-owned enterprises, since the transport of tourists by these modes generates revenue for the Cuban government. BIS said future export license applications for these transactions will be denied.

The agency has also lowered the minimum amount of U.S. content for licensed exports to Cuba from 25% to 10%.

"BIS is making this change to de minimis because the Cuban government could generate revenue or otherwise benefit from the receipt of items containing greater than 10 percent of U.S.-origin content," the agency said. 

In addition, the rule revises License Exception Support for the Cuban People (SCP) to make the Cuban government and communist party ineligible for certain donations, removes an authorization for promotional items that generally benefits the Cuban government, and clarifies the scope of telecommunications items that the Cuban government may receive without a U.S. export license. 

The latest regulations against Cuba by President Trump further unravel actions taken by the Obama administration to reestablish diplomatic relations and loosen some trade activity with the embargoed country.

President Obama announced the reestablishment of bilateral relations with Cuba on Dec. 17, 2014. Diplomatic ties were reestablished between the two nations during the summer of 2015 after the Caribbean country was removed from the State Department's list of state sponsors of terrorism. The U.S. embassy in Havana was officially reopened shortly thereafter.

Image Sourced from Pixabay

Posted-In: air cargo Cuba Freight FreightwavesNews Global Markets General

 

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