UPDATE: US Companies With A Presence (Since 12/17/14) In Cuba- No Manufacturing/Assembly

United States Companies With A Presence In Cuba- No Manufacturing/Assembly

Since 7 December 2016

NOTE: Some United States-based airlines have chartered their aircraft to third parties and, thus, have operational activities within the Republic of Cuba preceding 17 December 2014.  This year, some airlines commenced operation of regularly-scheduled commercial service under their direct management; and have or will have ticket offices in the Republic of Cuba and employees who are Republic of Cuba nationals.

NOTE: There are numerous United States-based tour operators and travel agents that have agreements with Republic of Cuba government-operated Havanatur and other Republic of Cuba government-operated companies to market authorized tours within Cuba have done so prior to 17 December 2014.

Connecticut- Starwood Hotels & Resorts Worldwide (hotel management)

Texas- American Airlines (flights)

Illinois- United Airlines (flights)

Washington- Alaska Airlines (flights)

Georgia- Delta Airlines (flights)

Southwest Airlines (flights)

New York- JetBlue Airlines (flights)

Florida- Silver Airlines (flights)

Minnesota- Sun Country Airlines (flights)

Tennessee- FedEx (cargo)

Florida-Carnival (cruise ship)

Connecticut- Pearl Seas Cruises (PENDING- cruise ship)

Florida- Norwegian Cruise Line Holdings (cruise ship)

Florida- Royal Caribbean Cruises, Ltd. (cruise ship)

California- Airbnb (residence reservations)

Connecticut- Booking.com (owned by Priceline) (hotel reservations)

Massachusetts- TripAdvisor (hotel reservations)

Florida- Stonegate Bank (Mastercard & correspondent banking)

Puerto Rico- Banco Popular de Puerto Rico (Mastercard)

Illinois- Caterpillar (Puerto Rico-based authorized distributorship)

Connecticut-General Electric (memorandum of understanding)

Florida- Natbank (Mastercard)

New York- Mastercard International (credit/debit branded cards)

Colorado- Western Union (financial services for many years)

New York- Colgate-Palmolive (oral education program- early 2014)

California- Google (donated products for interactive display)

California- Cisco Systems (donated no-cost networking academy)

New York- Verizon (roaming agreement)

Texas- AT&T (roaming agreement)

Kansas- Sprint (roaming agreement)

Washington- T-Mobile (roaming agreement)

New Jersey- IDT Corporation (direct long distance)

Alabama- Gulfwise LLC (export of one piece of equipment)

New York- Nestle Nespresso USA (coffee imports)

New York- Roswell Park Cancer Institute (vaccine clinical trial)

PDF FORMAT

Again... Cuba Shares More Details About Meetings With US

United States and Cuba To Hold Fifth Bilateral Commission Meeting in Havana

Media Note
Office of the Spokesperson
Washington, DC
December 6, 2016

The United States and Cuba will hold the fifth Bilateral Commission meeting in Havana, Cuba on Wednesday, December 7. Acting Assistant Secretary of State for Western Hemisphere Affairs Mari Carmen Aponte will lead the U.S. delegation. Embassy Havana Chargé d’Affaires Jeffrey DeLaurentis and Deputy Assistant Secretary John Creamer will also attend for the United States. The Cuban delegation will be led by Josefina Vidal, the Foreign Ministry’s Director General for U.S. Affairs.

The meeting will provide an opportunity to review progress and engagement on a number of priorities since the last Bilateral Commission meeting in September 2016, including human rights, civil aviation, health, law enforcement, economic issues, claims, environmental protection, agriculture, migration, educational and cultural exchanges, and trafficking in persons.

Cuba and the United Sates will hold the fifth Bilateral Commission Meeting

[MINREX] HAVANA, December 6th, 2016. Delegations of Cuba and the United Sates will meet in Havana, on Wednesday, December 7th, on the occasion of the fifth meeting of the Bilateral Commission.

The Cuban delegation will be led by Josefina Vidal Ferreiro, Director General for US Affairs in the Ministry of Foreign Affairs while the US delegation will be led by Mari Carmen Aponte, Acting Assistant Secretary of State for Western Hemisphere Affairs.

The agreements of the fourth meeting held on the past September 30th in Washington D.C. will be reviewed and an assessment will be made of the results attained ever since the establishment of the Bilateral Commission in August 2015 as a mechanism to follow up on the ties between the two countries after the reestablishment of diplomatic relations.

Likewise, the actions that will take place in the forthcoming weeks to advance in the process of improvement of relations will be defined, including the high-level visits, the new agreements of cooperation in areas of common interests, the technical meetings and the dialogues on issues of bilateral interest.

The Cuban representatives will reaffirm that the lifting of the blockade, the return of the illegally occupied territory of Guantanamo Naval Base and the elimination of other policies from the past will be essential for normalizing the relations between Cuba and the United Sates.

Mark C. Toner
Deputy Spokesperson
Daily Press Briefing
Washington, DC
December 6, 2016

QUESTION: The Cuban foreign ministry announced today that it’s moving forward with the United States on developing a road map deepening their detente. I’m just wondering what details you have on this for us and whether discussions with Cuba are being accelerated by both Havana and Washington before the new administration comes in place.

MR TONER: Yeah, so I don’t have a lot of details. I know that, as you noted, United States and Cuba are holding their fifth Bilateral Commission meeting. It’s in Havana. Wait, today’s not Wednesday. It’s tomorrow, I believe, and December 7th. And acting Assistant Secretary of State for Western Hemisphere Affairs Mari Carmen Aponte will lead the U.S. delegation. And obviously, our Charge d’Affaires in Havana, Jeffrey DeLaurentis, as well as Deputy Assistant Secretary John Creamer will attend on behalf of the United States. So I don’t know – I don’t have a lot of details on what the deliverables will be coming out of that. We’ll certainly update as the meetings take place.

With regard to your last question: Is this an acceleration? Not at all. As I said, this is a long-scheduled meeting. I believe it might have been delayed somewhat because of the period of mourning after the death of Fidel Castro, but it was long-scheduled. As – yeah, go ahead.

QUESTION: Do you agree though with the characterization that this is drawing a road map deepening the detente between the U.S. and Cuba?

MR TONER: Well, I think it’s – in the sense that – yes, I mean, we’re talking about – it’s another opportunity to review progress, certainly, that we’ve been – that has been made since we made the decision to re-establish diplomatic relations with Cuba and review progress on our engagement on a number of priorities. That includes, obviously, human rights, civil aviation, health, law enforcement, economic issues, claims, environmental protection, migration, educational, cultural exchanges, et cetera. So there’s a broad range of topics. Progress has not always been steady in all of them, but we certainly are striving to continue to make progress on all of them. And we’ll get – as I said, tomorrow I should have a better readout for you.

QUESTION: And some specifics on the --

MR TONER: Of course.

QUESTION: -- deliverables?

MR TONER: Yeah, I’ll try.

With 45 Days To Go.... US Department Of State Keeps Trying For More......

The Honorable Mari Carmen Aponte, Acting Assistant Secretary, Bureau of Western Hemisphere Affairs, United States Department of State, is visiting the Republic of Cuba from 6 December 2016 to 8 December 2016.  No details of the visit have been reported.

"Term of Appointment: 05/05/2016 to present.  Mari Carmen Aponte was appointed Acting Assistant Secretary in the Department of State’s Bureau of Western Hemisphere Affairs on May 5, 2016.

Previously, Aponte was the Ambassador of the United States to El Salvador from 2012 until February 2016. Her priorities in El Salvador included expanding crime prevention, growing the economy and moving the country towards democracy, sustainable development and human rights.

She is the first Puerto Rican woman to hold the title of ambassador. Born in Puerto Rico, Aponte moved to the United States to pursue a better education. After earning a BA in political science from Rosemont College, she taught in Camden, New Jersey and became aware of underrepresented educational needs of minority students. Aponte enrolled in Temple University Beasley School of Law and earned a JD in 1975. She was one of few Puerto Rican women enrolled in a U.S. accredited law program at that time and, subsequently, the first Latina lawyer in Pennsylvania. Aponte moved to Washington, D.C. in 1979 when President Jimmy Carter appointed her as a White House Fellow.

She continued practicing law in D.C and cofounded one of the first minority-owned law firms. In 1984, Aponte was elected the first woman president of the Hispanic National Bar Association. She continued to hold leadership positions for the next 25 years, advocating for women and the Latino community. From 2001-2004, she was Executive Director of the Puerto Rican Federal Affairs Administration. She was also on the board of directors for the National Council of La Raza and the Puerto Rican Legal Defense and Education Fund and later provided strategic counsel for the Hispanic Information and Telecommunications Network, a Spanish-speaking national non-commercial television network. Aponte received the 2015 Margaret Brent Women Lawyers of Achievement Award from the American Bar Association in recognition of her community service."

What Now? Creating A Dynamic For President Trump To Negotiate With President Castro

What Do Advocacy Groups & Their Supporters Do Now?

Their Candidate Lost & There Was No Viable Back-Up Plan

Need To Create Negotiation Dynamic

Encouraging President Trump Negotiate With President Castro

The 44th President of the United States did not negotiate what was difficult with the President of the Republic of Cuba; the 45th President of the United States seems eager to do so because it’s in his DNA.

From 17 December 2014 through the early evening of 8 November 2016, advocacy organizations and their sources of funding focused upon legislative remedies for policy, regulatory and statutory impediments to a normalized commercial, economic and political bilateral relationship between the United States and the Republic of Cuba.

During the early morning hours of 9 November 2016, as the United States national election results were confirmed, that misguided and futile legislative focus, rather than a regulatory (and license issuing) focus, placed twenty-three months of Obama Administration initiatives in grave peril.

Then, on the evening of 25 November 2016, sixteen days after the election, H.E. Dr. Fidel Castro Ruz, former president of the Republic of Cuba, died.  This event catapulted all that is the Republic of Cuba again into a leadership position within a global media pageant.

The death of former President Castro, at a moment when the President-Elect was identifying and solidifying who will serve in his administration, provided bountiful opportunity for individuals currying favor (and employment) to solidify and to amplify their Post-Castro bonafides.

With forty-six (46) days before Inauguration Day, and the ascension of Mr. Donald J. Trump (70) as 45th President of the United States, there are individuals amongst the Transition Team and Landing Teams ensconced within the United States Department of State, United States Department of the Treasury, United States Department of Commerce, United States Department of Justice and National Security Council in The White House who are predisposed, either by personal journey or professional purpose, to restrain in some manner each of the Obama Administration initiatives. 

Some organizations, attorneys and United States-based companies, those with a knowledge base predating 17 December 2014 (and having engaged with Republic of Cuba issues prior to the advent of Google, Facebook & Twitter) had advocated beginning January 2009 (and more forcefully since 17 December 2014) for the Obama Administration to do as much as was possible through changes in regulations, and then issue as many licenses as possible so that licensees could implement those licenses, which are generally valid for one to three years; and leave only statutory issues for his successor. 

In this way, the bilateral commercial relationship, the landscape, would have an opportunity to root, adhere, bond, flourish and potentially be less impervious to external pressures, for example, unanticipated election results. 

However, this approach was not deemed erotic and visual enough- seeking to convince a simple majority (and sixty-vote majority) of 535 Members of the United States Congress rather than the singular occupant of the Oval Office was believed to be a far simpler task- and one that was potentially far more lucrative for those employed in the effort.

Unfortunately, the government of the Republic of Cuba too chose poorly and failed to embrace the winning narrative and, a result, but not the only unpleasant result, finds a potential bilateral political conflict- which some in the government may find of value. 

And, with the expectation that some United States-based companies will announce before 20 January 2017 agreements to further engage in export, import or provision of services, the President-Elect (and his staff and advocates) will have additional targets upon which to focus his energies.  These announcements, especially relating to hospitality, should have been made months ago by the government of the Republic of Cuba, even if implementation would be postponed. 

Now, advocacy organizations are attempting to pivot from seeking funds to change United States statutes to seeking funds to preserve what exists in those statutes and policies and regulations. 

The most egregious example of a lack of preparation and execution by advocacy groups was in seeking changes to the Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000.  The goal was to change the provision requiring payment of cash in advance for food products and agricultural commodities, which the United States business community publicly supported as a matter of philosophy; with companies believing that they, not the United States government, should determine the credit-worthiness of a customer.

Unfortunately, during Congressional hearings, at press events, in media releases and at conferences, there has not been a statement by a company (or financial institution) as to what payment terms they would offer to the government of the Republic of Cuba if permitted to do so- 30 days, 60 days, 90 days, 120 days, 180 days, one year?  This lack of specificity was one reason for a crippled and ultimately failed legislative initiative. 

Advocacy groups had no success for almost two years since 17 December 2014 and now they expect to have influence with a Trump Administration that has placed revising Obama Administration initiatives on a particularly public pedestal in conjunction with the leadership in the United States Congress which leans favorably (some might argue mightily) towards embracing, albeit with perhaps modifications, the agenda of the 45th President of the United States.  Astonishing.

The choice is both simple and fundamental- attempt to obtain funds and media access to battle the President of the United States for potentially four years (or at least through 24 February 2018) or accept reality that he and those whom he has selected (and those who have volunteered) to advise him are focusing on Post-Castro Cuba. 

The outcome of this battle will be the same as the outcome (failure) of the latest twenty-three-plus month legislative effort only this time, more onerously, the President of the United States and the leadership of the United States House of Representatives and the United States Senate will be aligned.  A reminder, that three-way symbiotic dynamic did previously exist- from 2009 to 2011 when the same political party controlled the executive and legislative branches of government; there was no full-on legislative effort at the time focusing upon the Republic of Cuba.

The United States and government of the Republic of Cuba must cease the focus on winning a battle and begin to focus on resolving a problem.  Advocates and Members of Congress need direct energies in support of efforts by the Trump Administration to negotiate a settlement of the certified claims.  This effort must not be encumbered by discussing claims against the United States by the government of the Republic of Cuba.

The resolution of the certified claims provides the legislative foundation to revise and rescind the Cuban Assets Control Regulations (CACR), the Cuban Democracy Act (CDA) of 1992, the Libertad Act (“Helms-Burton”) of 1996, and the Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000.   

There were 8,821 claims of which 5,913 awards valued at US$1,902,202,284.95, have been certified by the United States Foreign Claims Settlement Commission (USFCSC) at the United States Department of Justice. 

Of these claims, thirty (30) United States-based companies hold 56.85% of the total value.  The USFCSC permitted interest to be accrued in the amount of 6% per annum; with the current value ranging from US$6 billion to US$9 billion.

Significant to note that no United States-based company who has engaged with the Republic of Cuba- exports, imports, provision of services, and who has a certified claim(s) against the government of the Republic of Cuba has reported a repudiation of its filing(s) with the USFCSC.

This position includes Stamford, Connecticut-based Starwood Hotels & Resorts Worldwide (2014 revenues exceeded US$5.7 billion), a subsidiary of Bethesda, Maryland-based Marriott International (2015 revenues exceeded US$14 billion), which as a result of a series of mergers and acquisitions during the last fifty-seven years, a US$51,128,927.00 claim initially made by New York-based International Telephone & Telegraph Corporation (ITT) is now controlled by Starwood Hotels and Resorts Worldwide. 

In 2016, the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury granted a license(s) to Starwood Hotels & Resorts Worldwide to manage properties owned by Republic of Cuba government-operated entities located in the city of Havana, Republic of Cuba.  The properties are Gran Caribe-owned Hotel Inglaterra (scheduled for transition in 2017); Habaguanex-owned Hotel Santa Isabel and Hotel Quinta Avenida (re-branded in June 2016 as Four Points by Sheraton Havana).

Obtaining a settlement of the certified claims can be a success for the Trump Administration- one that was impenetrable for the Obama Administration.  By removing an obstacle to productive negotiations- the United States Department of State, and replacing career United States government employees with seasoned veterans of the private sector, the likelihood for success will be significantly magnified.  The good people at the United States Department of State are not equipped to negotiate this issue due to the immense historical environment; the skill set for success is different.  The issue can no longer be viewed in increments of two years, four years or six years- the terms of elected officeholders.

There is now a date by which a settlement of the certified claims must be reached:  Saturday, 24 February 2018, the retirement of General Raul Castro Ruz (85), President of the Republic of Cuba, and the inauguration of current Vice President of the Council of State, H.E. Miguel Diaz-Canel Bermudez (56), as President of the Republic of Cuba. 

The message from the Trump Administration to the government of the Republic of Cuba would be succinct: There will be no expansion of the bilateral relationship until there is a settlement of the certified claims. 

Once that issue is resolved, the United States can move swiftly to disable all policy, regulatory, and statutory impediments that negatively impact a thriving and respectful commercial, economic and political bilateral landscape.

If the 8 November 2016 election had a different result, the expectation would have been for the Obama Administration initiatives to be continued, although perhaps in a more qualified manner relating to reciprocity. 

The Trump Administration is expected, at minimum, to freeze any expansion of the Obama Initiatives- likely rescind few or none; perhaps revise regulations to increase enforcement as to who is visiting the Republic of Cuba and for what purpose they are visiting the Republic of Cuba.  A result would be fewer individuals subject to United States jurisdiction visiting the Republic of Cuba- impacting United States-based cruise ships and commercial aircraft along with Republic of Cuba-based private residences and private restaurants.

As President Barack Obama sought to use regulations to encourage change within the Republic of Cuba, President Trump expects to use regulations to require change within the Republic of Cuba.  The distance between encourage and require is more than twelve letters of the alphabet. 

The Republic of Cuba-focused advocates of President Trump are more passionate than were their opposite counterparts for President Obama.  On 20 January 2017, the United States business community needs to tread carefully by not discounting that passion; and grasp the obvious- President Obama is gone and President Trump is here.

President Trump believes that he will be able to create opportunities for the citizens of the Republic of Cuba in spite of the government of the Republic of Cuba.

The Trump Administration should continue to suspend Title III of the Libertad Act (“Helms-Burton”) of 1996.  The goal is to maintain a conflict-free zone within which to negotiate a settlement of the certified claims.  There is no value in creating unnecessarily impactful distractions to the primary goal- a resolution of the certified claims.  Piling on will not enhance the probability that the government of the Republic of Cuba will embrace the negotiation process; it will provide the spark for friction and avoidance.

There will be individuals in the public sector who will rather adhere to the status quo of dispute and intransigence because resolution is equated with surrender, with failure.  That’s ignorant.  5,913 certified claimants have been waiting more than fifty-five years for the government of the United States, for its President and Negotiator-In-Chief, to obtain an equitable settlement… now that leader may have arrived. 

A resolution of the certified claims may be the most difficult challenge that President Trump has encountered.  This is an opportunity for him to create a team, instruct that team, provide them with a deadline... and then await the result. 

If the government of the Republic of Cuba wants to advance its Post-Castro trajectory with the weight of United States policies, regulations and statutes pressuring its 11.4 million citizens, then refuse to negotiate a settlement of the certified claims. 

If the government of the Republic of Cuba wants to advance its Post-Castro trajectory with the unilateral, bilateral and multilateral benefits from a United States which seeks to do no harm, then negotiate a settlement of the certified claims.

The 44th President of the United States did not negotiate what was difficult with the President of the Republic of Cuba; the 45th President of the United States seems eager to do so because it’s in his DNA.

CLICK FOR THE COMPLETE ANALYSIS IN PDF FORMAT

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173, 227, 229, 148, 204 & 194.... Why These Numbers Are Significant

Does age impact those who have responsibility for creating the environment to negotiate?  

As of 20 January 2017:

The combined age of the three highest-ranking officeholders in the United States is 173; in the Republic of Cuba it is 227.  

The combined age of the three highest-ranking Democrats in the United States House of Representatives is 229; for the Republicans it is 148.  

The combined age of the three highest-ranking Democrats in the United States Senate is 204; for the Republicans it is 194.  

Age and the perception about age, matters.  So does the perspective from age.... 

Is This The Person Who Will Save (Preserve) Obama Administration Commercial Engagement With Cuba?

The Obama Administration is looking to Ms. Angela Mariana Freyre To Save Its Commercial Engagement With Cuba

Ms. Freyre has been visiting the Republic of Cuba with the purpose of encouraging the government of the Republic of Cuba to 1) authorize commercial engagement where licenses have been issued to United States-based companies by the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury and/or Bureau of Industry and Security (BIS) of the United States Department of Commerce and 2) authorize the implementation of regulatory changes made by the Obama Administration, but yet to be permitted by the government of the Republic of Cuba.

LINK TO: Who's Doing What Now

Angela Mariana Freyre
Senior Vice President and General Counsel | General Counsel
Angela Freyre

"Angela Mariana Freyre is the 20th General Counsel and Senior Vice President of the Export-Import Bank of the United States. In this capacity, she is the Bank's chief legal officer, managing its attorneys and overseeing diverse transactions and litigation portfolios, and is a member of the Bank's senior management team.

At the Export-Import Bank, Ms. Freyre advises the Board of Directors and staff on matters relating to the Charter of the Bank, as well as ethics, conflicts of interest, governance and reputational risk. She serves as Corporate Secretary, attending meetings and formalizing actions of the Board of Directors, and serves as a member of all key senior management committees. She is responsible for interpreting and implementing laws applicable to or affecting the Bank and plays a key role in the Bank’s relationship with Congress, Treasury, the State Department and other federal government agencies.

Prior to joining the Obama Administration, Ms. Freyre served as Senior Vice President and Deputy General Counsel for Legal and Strategic Affairs at The Nielsen Company, a global leader in the media and marketing information business whose clients include the leading US media companies. She managed and expanded strategic relationships with Nielsen’s most important media clients, led teams in the negotiation of Nielsen‘s most important revenue and strategic contracts, and supported Nielsen’s government affairs team.

Previously to Nielsen, Ms. Freyre practiced law in New York and Paris, developing an international corporate practice, including joint ventures, mergers and acquisitions and complex financial transactions, with major US and foreign clients for ten years each at Coudert Brothers LLP, where she was a partner, and Mudge Rose Guthrie Alexander & Ferdon LLP.

At Coudert Brothers, Ms. Freyre served as head of the Latin American Practice Group responsible for the oversight of the group’s transactions and worked in Latin America, Africa, and Asia on privatization transactions, mergers and acquisitions and economic development projects. At Mudge Rose, Ms. Freyre was involved in the firm’s securities practice and significant cross border transactions.

Ms. Freyre attended Wellesley College, Georgetown University Law Center, and l’Universite de Droit, d’Economie et des Sciences Sociales de Paris, and was a Fulbright Scholar. She was born in Havana, Cuba, has lived in Paris as well as New York City for almost 30 years (where she had significant public service and board appointments), and currently resides in Washington, DC. Ms. Freyre is fluent in Spanish and French."

The Negotiator-in-Chief For Cuba: We’re Grown-Ups- Let’s Make A Deal; Calling Mr. Kenneth Feinberg

The Negotiator-in-Chief
We’re Grown-Ups; Let’s Make A Deal
A Get-Tough & Get-Results Team Led By Mr. Kenneth Feinberg
President Trump Can Create The Legacy That President Obama Didn’t

The unclaimed legacy: President Trump can claim title to the “legacy” that President Obama failed to achieve by focusing on the difficult issues in a timely manner rather than the easy issues at a leisurely pace.

What we know: President-Elect Trump has shared what President Trump will and will not do relating to the Republic of Cuba.  

There is justifiable confusion for the United States business community in appreciating the varietal nuances of statements (spoken and written) by Mr. Donald Trump, the business executive; Mr. Donald Trump, the candidate for the presidential nomination of the Republican Party; Mr. Donald Trump, the presidential nominee of the Republican Party; and Mr. Donald Trump, the President-Elect of the United States.  This lack of clarity is not unusual for a candidate for public office or for a soon-to-be holder or a holder of public office.

President-Elect Trump has shared he does not want to expand the commercial, economic or political bilateral relationship with the Republic of Cuba unless there is a “better deal” than obtained and implemented by the Obama Administration.  

He wants something to give something; he wants to negotiate (and re-negotiate) rather than continue what he believes to have been a unilateral surrender of interests by the Obama Administration.  So, what might he do?

The soil upon which United States policy, regulations and laws sprouted since 1961 was created by the seizure of assets by the government of the Republic of Cuba.

There were 8,821 claims of which 5,913 awards have been certified by the United States Foreign Claims Settlement Commission (USFCSC- https://www.justice.gov/fcsc) at the United States Department of Justice which are valued at US$1,902,202,284.95.  

Of these claims, thirty (30) United States-based companies hold 56.85% of the total value.  The USFCSC permitted interest to be accrued in the amount of 6% per annum; with the current value ranging from US$6 billion to US$9 billion.

Members of the President-Elect’s transition teams and individuals who encompass his increasing array of advisors and policy creators are focused upon results- and the narrative of presenting the government of the Republic of Cuba with a fixed timetable, perhaps 180-days, during which a team designated by The White House would be tasked with obtaining an agreement to satisfy the interests of the 5,913 certified claimants.

The goal is to have an agreement in place before 24 January 2018, the retirement of H.E. Raul Castro Ruz (85 years old), President of the Republic of Cuba, and the inauguration of current Vice President Miguel Diaz-Canel Bermudez, 56 years old.

The first action would be for The White House to remove the United States Department of State as lead negotiator and replace it with a team reporting directly to the National Security Council (NSC) at The White House.

During the last twenty-three (23) months, the United States Department of State has failed to either create a viable foundation for a settlement of the certified claims or moved significantly forward the process from discussion to negotiation.  They have had a chance.  Now is a moment for a renewed dynamic.

The Obama Administration has professed that a settlement of the certified claims is a priority- a high priority.  There were two meetings in twenty-three months.  The date for a second meeting was not agreed to after the first meeting.  The date for a third meeting was not agreed to after the second meeting.  So much for the issue of the certified claims being a “high priority” for the Obama Administration.

State Department Meeting Timeline

17 December 2014 to 8 December 2015- 356 days between President Barack Obama’s 2,283-word statement (that did not mention certified claimants) and the first meeting of representatives from the government of the Republic of Cuba and the United States Department of State to discuss the issue of certified claims.

8 December 2015 and 28 July 2016- 233 days between the first meeting and second meeting of representatives from the government of the Republic of Cuba and the United States Department of State to discuss the issue of certified claims.

28 July 2016 to 20 January 2017- 176 days between the second meeting of representatives from the government of the Republic of Cuba and the United States Department of State to discuss the issue of certified claims and the end of the Obama Administration.

Based upon the results, the Obama Administration would had no intention of negotiating a settlement, but remained content with the imagery of dialogue.  The questions that the United States Department of State never answered:  

  • Why haven’t Certified Claimants Sector Working Groups been established?   
  • Why haven’t certified claimants been summoned to meetings at the United States Department of State to create a negotiating platform?  
  • Is there a Certified Claimants Committee?  Thirty (30) of the certified claimants account for 56% of the principal value of the certified claims.
  • Have Agendas been created- and followed?  
  • Have Modalities of Settlements been established?
  • Where is the Guidance?

The Art Of The Deal

The White House team would be directed by Mr. Kenneth Feinberg, who, as a designated Special Master, compensated by the USFCSC, would be responsible for negotiating and then implementing a settlement.  As Mr. Feinberg has adjudicated other cases of United States national interest, his settlement agreement would provide for immediate value to those claimants who choose to abide by the settlement offering.

Mr. Feinberg, is a New York, New York-based attorney specializing in mediation and alternative dispute resolution, who served as Special Master for the September 11th Victim Compensation Fund and TARP Executive Compensation; Administrator of the BP Deepwater Horizon Disaster Victim Compensation Fund; and was retained to assist in the General Motors recall response and compensation for Volkswagen owners.  Mr. Feinberg appreciates the singular importance of deadlines.

Important that the negotiations with the government of the Republic of Cuba to reach a settlement for the certified claimants not be a component of any other unilateral or bilateral or multilateral issue(s).  For the relationship with the United States to expand, a settlement of the certified claims needs to be reached without the inclusion of extraneous issues.

That United States-based companies with certified claims have discussed a return with the government of the Republic of Cuba or have re-engaged with the government of the Republic of Cuba provides a foundation for which negotiations may be initiated by the Trump Administration.

The Libertad Act of 1996 authorizes individuals and companies subject to United States law to engage in direct negotiations with the government of the Republic of Cuba to settle claims registered with the USFCSC. 

The Trump Administration (or government of the Republic of Cuba) may consider hosting a Certified Claimant Settlement Forum- and any certified claimant who desires to return to the Republic of Cuba marketplace and has a proposal would be welcomed; and all proposals would be subject to a thirty (30) day yes-or-no response.  

In 2016, Stamford, Connecticut-based Starwood Hotels & Resorts Worldwide (2015 revenues exceeded US$5.7 billion), which is a subsidiary of Bethesda, Maryland-based Marriott International (2015 revenues exceeded US$14 billion), was granted a license by the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury to manage properties in the city of Havana owned by Republic of Cuba government-operated entities.  

The properties are Gran Caribe-owned Hotel Inglaterra; Habaguanex-owned Hotel Santa Isabel and Hotel Quinta Avenida (re-branded as Four Points by Sheraton Havana on 27 June 2016).  The Hotel Quinta Avenida is owned by Republic of Cuba government-operated Gaviota SA, which is controlled by the Revolutionary Armed Forces of the Republic of Cuba (FAR).

As a result of a series of mergers and acquisitions during the last fifty-seven years, a US$51,128,927.00 claim initially made by New York-based International Telephone & Telegraph Corporation (ITT) is now controlled by Starwood Hotels and Resorts Worldwide, which can use this value as a means to secure opportunities within the Republic of Cuba.

Starwood Hotels & Resorts Worldwide controls a certified claim representing approximately 2.68% of the total principal value of the certified claims.  

What Can The Trump Administration Do?

The Trump Administration could use funds obtained during the last eight years‎ from global financial institution settlements and not redirected by the United States Congress for other purposes to offset some or all of the principal/interest amount of the certified claims.  

“The Foreign Claims Settlement Commission of the United States (FCSC) is a quasi-judicial, independent agency within the Department of Justice which adjudicates claims of U.S. nationals against foreign governments, under specific jurisdiction conferred by Congress, pursuant to international claims settlement agreements, or at the request of the Secretary of State. Funds for payment of the Commission's awards are derived from congressional appropriations, international claims settlements, or liquidation of foreign assets in the United States by the Departments of Justice and the Treasury.”

If the Trump Administration makes a payment to the certified claimants essentially on behalf of the government of the Republic of Cuba, might those who have civil judgements in the United States against the government of the Republic of Cuba seek to seize ‎the funds?  Someone may try.  That does not mean don’t do it.

A certified claims settlement should be based upon the payment of 100% of the value of each certified claim.  Even with a full settlement based upon principal and interest, the annual rate of inflation has substantially diminished the value of each certified claim.  

Opportunities for settlement include, but are not limited to, debt-for-equity swaps and substitution investments (one structure for another; one piece of land for another, etc.).  In combination with or separately from compensation formats, the government of the Republic of Cuba could provide transferable values to the certified claimants including:

  • Income tax holidays
  • Import duty exemptions
  • Reduced energy rates
  • Property tax credits
  • Earned income tax credits

The OFAC should issue a general license for certified claimants, their representatives and agents to visit the Republic of Cuba for the purpose of negotiating a settlement.

The resolution of the certified claims will provide the legislative foundation to revise and rescind the Cuban Assets Control Regulations (CACR), the Cuban Democracy Act (CDA) of 1992, the Libertad Act (“Helms-Burton”) of 1996, and the Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000.

Advocacy groups need to be re-tasked, similar to a satellite, from a pathway of mythology focused upon creating new statutes to a non-fiction, and potential best-seller, application towards supporting a settlement of the certified claims.

The Trump Administration is focused upon connecting any further expansion of bilateral commercial opportunities, meaning exports of products and services and imports of products and services, to a settlement of the certified claims.

Relating Blog Posts:

http://www.cubatrade.org/blog/2016/7/29/transcript-of-state-department-briefing-about-us-cuba-claims-discussion?rq=department%20of%20state%2C%20cuba

http://www.cubatrade.org/blog/2016/7/24/28-29-july-2016-may-be-near-last-opportunity-for-us-claimants-to-advocate-face-to-face-for-settlement-before-the-end-of-the-obama-administration?rq=department%20of%20state%2C%20cuba

http://www.cubatrade.org/blog/2016/7/28/us-department-of-state-reports-on-claims-discussion?rq=department%20of%20state%2C%20cuba

COMPLETE TEXT IN PDF FORMAT

UPDATED: Deputy National Security Advisor Ben Rhodes To Cuba- Was To Have Been Secret Visit

The Honorable Benjamin J. Rhodes, Assistant to the President and Deputy National Security Advisor for Strategic Communications, is visiting the Republic of Cuba on what had been an unannounced visit to meet with officials of the government of the Republic of Cuba.

UPDATE NOTE: 5 December 2016- When inquiring as to whether Mr. Rhodes was scheduled to use a United States government aircraft for his unannounced visit to the Republic of Cuba, the Obama Administration responded that since Mr. Rhodes was representing the United States at a service in honor of H.E. Dr. Fidel Castro Ruz, former president of the Republic of Cuba, he traveled "by official government plane to Cuba, as is customary for this type of official travel." The problem with the response is the visit by Mr. Rhodes to the Republic of Cuba was scheduled before his participation in the services was announced.  So, the Obama Administration was dishonest and, despite follow-up requests, refuses to provide additional information.

The visit only become public due to his participation at a service in the city of Havana in honor of H.E. Dr. Fidel Castro Ruz, former president of the Republic of Cuba.

Considered an architect of the Obama Administration initiatives which became public on 17 December 2014, the visit of Mr. Rhodes to the Republic of Cuba with 51 days remaining in the Obama Administration may signal a final (some might argue desperate) effort by the Obama Administration to 1) initiate further regulatory changes and/or 2) obtain commitments from the government of the Republic of Cuba that it will implement existing (or new) initiatives quickly (before 20 January 2017) and approve the use of existing licenses issued 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.

PRESS BRIEFING BY PRESS SECRETARY JOSH EARNEST
James S. Brady Press Briefing Room
29 November 2016

Q    Sure.  Thanks, Josh.  Will the United States send a delegation to the funeral of Fidel Castro?

MR. EARNEST:  Josh, I can tell you that the President has decided not to send a presidential delegation to attend the memorial service today.  I can tell you, however, that Deputy National Security Advisor Ben Rhodes will attend the service, as will the top U.S. diplomat in Cuba, Jeff DeLaurentis.

Those of you who have been following this story closely over the last couple of years know that Mr. Rhodes has played a leading role in crafting the normalization policy that President Obama announced about two years ago.  He has been the principal interlocutor with the Cuban government from the White House in crafting this policy and implementing it successfully.  As a part of those responsibilities, he has the occasion to travel to Cuba occasionally to further implement this policy.

He actually was already planning to travel to Cuba this week, so in addition to the meetings that he already has on his schedule with the Cuban government officials and with officials at the U.S. embassy, he also will be attending the service that the Cuban government has planned for this evening.  And as I mentioned, he'll be attending with the top U.S. diplomat on the island, Ambassador DeLaurentis.

Q    So I guess it begs the question that if two high-ranking U.S. officials -- national security official who worked on Cuba, the ambassador -- are attending, how is that not a U.S. delegation?

MR. EARNEST:  Well, Josh, there’s a formal process where the President would designate a presidential delegation to travel to Cuba specifically to represent the United States at a foreign event.  Sometimes it's an inauguration; sometimes it's a coronation; sometimes it's a funeral.  That will not be taking place this time.  But the United States will be represented at the event by our top diplomat on the island and by a senior White House official who will be traveling to Cuba.

Q    What was the thinking behind not designating a formal delegation?

MR. EARNEST:  Obviously, Josh, so much of the U.S. diplomatic relationship with Cuba is quite complicated.  There are many aspects of the U.S.-Cuba relationship that were characterized by a lot of conflict and turmoil not just during the Castro regime, but we continue to have some significant concerns about the way the Cuban government currently operates, particularly with regard to protecting the basic human rights of the Cuban people.

So we believe that this was an appropriate way for the United States to show our commitment to an ongoing, future-oriented relationship with the Cuban people.  And this is an appropriate way to show respect, to participate in the events that are planned for this evening, while also acknowledging some of the differences that remain between the two countries.  

Q    Thanks, Josh.  Back on the Castro event.  You're not suggesting that Mr. Rhodes and Mr. DeLaurentis are attending this in a private capacity, right?  They are representing the United States?

MR. EARNEST:  That's correct.  And I think if I was unclear about that, yes, they will be representing the United States at the memorial service this evening.

 Q    One last thing on the Castro funeral plans.  I know there's the memorial service today, but there's a lot going on -- I know the formal funeral ceremony is taking place on Sunday.  Is the United States sending anyone to that ceremony,y or is this the only event, memorial event, that is being attended by U.S. officials?

MR. EARNEST:  My understanding, at least the way that it's been described to me is this is -- the event that the Cuban government is organizing for this evening is the event where the United States will be represented by the Deputy National Security Advisor and by the top diplomat in Cuba.

I guess I'd refer you to the embassy in Havana for greater information about whether or not there will be a U.S. presence at any of those other events.  Certainly no one from the White House and no other delegation will be sent to Cuba to participate in any of the other events.  But I don't know if there will be other diplomats or other officials who are based at the embassy that may participate in some other events.

Q    The memorial service and the funeral Sunday -- I just want to clarify one thing on that.  Will the same U.S. non-presidential delegation be attending the funeral?  Can we assume that Ben Rhodes and ambassador -- or DeLaurentis will also be in attendance at the funeral?

MR. EARNEST:  They are only participating in the memorial service that's planned for tonight.  The briefing that was provided to me is that the actual funeral itself is actually a private event.  But I can tell you that this is the only event that the Deputy National Security Advisor is planning to attend.

PRESS BRIEFING BY PRESS SECRETARY JOSH EARNEST
James S. Brady Press Briefing Room
30 November 2016

Q    Thank you.  On the funeral of Fidel Castro in Cuba this weekend, it’s a relatively long affair.  So I’m wondering whether at some point the President is expected to watch parts of the funeral.  And will he be updated regularly by Ben Rhodes, who is there for the funeral?

MR. EARNEST:  I don't anticipate that the President will watch any of the proceedings on television.  Mr. Rhodes and our diplomat in Cuba, Ambassador DeLaurentis, participated in a memorial service last night.  But I'm not aware that either of them intends to be a part of all of the activities over the next three days.  The two of them were in attendance last night representing the United States.

But Mr. Rhodes remains in Cuba today because he's been -- he had previously planned to travel to Cuba this week to have meetings with government officials and officials at the U.S. embassy to discuss the continued effort to implement a policy of normalizing relations between our two countries.  But the last I heard is that he's actually planning to come back tonight.  So I don't think that -- I know that he won't be there and participating in the events that are planned over the next several days.

     Q    Any details by any chance of who exactly those meetings were with and what they might have been about?

MR. EARNEST:  Not at this point, but when he gets back we'll see if we can get you a readout of his engagements while he was there.

From The Hill: Trump and Cuba: A murky future

The Hill
Washington, DC
30 November 2016

Trump and Cuba: A murky future

By Melanie Zanona
 
The death of Fidel Castro has reignited the debate over President Obama’s opening with Cuba, with hard-liners renewing their calls for President-elect Donald Trump to revisit the decision to normalize diplomatic relations.

Critics of the Obama policy, like Sen. Marco Rubio (R-Fla.), argue that travel and trade with Cuba will only serve to enrich the Castro government despite its history of human rights abuses.

“We’re going to re-examine everything the president has done, and figure out what’s the right thing to do,” Rubio, a son of Cuban immigrants, told reporters Tuesday.

Earlier this year, the Republican Party appeared to be warming to the idea of a diplomatic thaw with Cuba.

Commercial U.S. flights started landing on the island this summer, pro-tourism bills were gaining more Republican co-sponsors and an amendment to lift the ban on Cuba tourism was easily added to a Senate spending bill earlier this year.

But after Castro — who ruled the Communist nation for decades before turning it over to his brother, Raúl, in 2008 — died on Friday, critics of the rapprochement of Cuba have gone on the offensive in hopes of shaping Trump’s policy once he takes office in January.

Trump has repeated his threat to reverse Obama’s decision to open diplomatic and commercial ties with Cuba if the communist government doesn’t adopt changes.

“If Cuba is unwilling to make a better deal for the Cuban people, the Cuban/American people and the U.S. as a whole, I will terminate deal,” Trump tweeted.

But it’s still unclear just how far Trump is willing to go in rolling back Obama’s laundry list of regulatory actions, which are aimed at easing travel and trade restrictions and are widely popular with the U.S. business community.

Trump said earlier this year that he was “fine” with opening up Cuba and told CNN he may open a hotel there. A top aide to the real estate mogul, Kellyanne Conway, said on “Meet the Press” this weekend that “nothing is definite” when it comes to Trump’s Cuba policies.

“We don’t know what he’s going to do,” Sen. Jeff Flake (R-Ariz.), a vocal proponent of reengaging with Cuba, told reporters on Tuesday. “We’ve heard varying signals from the Trump administration. We’ll just have to wait and see.”

Since Obama first announced the new policy toward Cuba in 2014, the administration has reopened the embassies in Havana and Washington, removed Cuba from a list of state sponsors of terror and resumed commercial air service with the island for the first time in over 50 years.

U.S. tourism to the island is still banned and the trade embargo has not been lifted, but Obama has carried out a string of other regulatory changes aimed at bringing the two countries closer together.

Those actions include allowing Cuban textiles, coffee and pharmaceuticals to be imported to the U.S.; removing or lessening most licensing requirements for permitted travel to Cuba; allowing American travelers to bring home an unlimited amount of rum and cigars; and authorizing U.S. individuals and businesses to have bank accounts on the island.

But because almost everything was done through executive action and without the help of Congress, there is wide consensus that almost all of Obama’s Cuba policies can be dismantled with the stroke of a pen.

“Nothing [Obama] has done in the past 23 months cannot be reversed by President-elect Trump with a signature,” said John S. Kavulich, president of the U.S.-Cuba Trade and Economic Council. “The only impediment to president-elect Trump reversing or revising the initiatives of President Obama is a lack of ink in his pen.”

Sen. Ted Cruz (R-Texas), who is of Cuban descent, said he was encouraged by Trump’s response to Castro’s death.

“There’s a stark contrast this week between President-elect Trump’s response to the death of Fidel Castro, and the weak and timid response of President Obama,” Cruz told reporters Tuesday. “I’m encouraged by that stark contrast.”

Rep. Ileana Ros-Lehtinen (R-Fla.), another staunch Cuba critic, hopes Castro’s death is “the first page of the closing chapter on the Castro regime” and said she believes Trump will make good on his promise to revisit Obama’s Cuba policies.

“However, a tyranny led by Raúl Castro and its repressive apparatus remains in place oppressing the Cuban people,” Ros-Lehtinen said in a statement. “President-Elect Trump has pledged to roll back President Obama’s unilateral concessions to the Castro regime and it is my belief that he will keep that promise.”

Although Trump may be able to easily dismantle Obama’s efforts logistically, it may not be politically popular, especially among the business community.

“Can he do it? Yes,” Kavulich said. “But what are the repercussions?”

Kavulich warned that there might even be legal repercussions because of the deep-rooted commercial interests in the island.

Any effort to suspend or reduce flights, for example, is sure to face fierce pushback from the U.S. airline industry, which invested significant time and resources into the new flight routes.

Obama has also already authorized U.S. hotels to manage properties on the island, allowed Airbnb to offer reservations for 10,000 residences and let telecommunications companies install equipment in Cuba.

Travel advocates hope the economic benefits of Cuban trade and travel will convince Trump to leave many of Obama’s policies in place.

“Mr. Trump says the government should be run like a business, and there’s no business in the world that would continue a failed strategy for 55 years,” said Madeleine Russak, communications director for Engage Cuba. “Cuba is a growing market with tremendous investment opportunities. We’re hopeful that as a businessman, he recognizes those opportunities.”

White House press secretary Josh Earnest also suggested that Trump could find it difficult to unwind the growing ties between the two nations.

“It’s just not as simple as one tweet might make it seem,” Earnest said Monday. “There are significant diplomatic, economic [and] cultural costs that will have to be accounted for if this policy is rolled back.”

Some travel advocates think Trump is more likely to take steps like closing down the embassies, refusing to nominate an ambassador and cracking down on people trying to travel under one of the 12 permissible categories, as opposed to completely halting commercial flights to Cuba.

While some had hoped Fidel Castro’s death would pave the way for a complete reversal of the détente, others think the biggest impact will be that Obama is now more hesitant to move ahead with any further Cuba regulations in his final weeks in office.

The business community has been pushing for the White House to allow Cuban financial institutions to have accounts with U.S. banks and expand the products that can be imported and exported to Cuba.

“There’s no question that the timing of Fidel’s death couldn’t be worse for the Obama administration,” Kavulich said. “The problem is, now any additional regulations will be accompanied by Fourth of July fireworks. It will be controversial by definition, even if people agree with it.”

LINK TO ARTICLE

The Pushmi-Pullyu Syndrome Of The Obama Administration

Why Do Commerce, State, Transportation, USDA & FCC View US Law So Differently?
The Result Is United States Companies Not Receiving The Support They’re Entitled To

According to the United States Departments of Commerce and Agriculture, they are prohibited by law from assisting United States-based companies, including in trade missions, due to a provision of the Trade Sanctions Reform and Export Enhancement Act of 2000.  Private sector attorneys have issued opinions disagreeing with this view.

From a 2015 interview by The Honorable Penny Pritzker, United States Secretary of Commerce, with National Public Radio (NPR): “For example, she was not allowed to bring any American executives along to strike business deals on this trip.”  Secretary Pritzker said “I can’t have a trade mission.”

The USDA and the DOC reported that their Republic of Cuba-related activities (and by extension the United States Government) were restricted and/or prohibited not be choice (policy), but law (statute), by the Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000, title IX, Public Law 106-387 [22 U.S.C. 7207(a)(1)] (TSREEA).   

§ 7207. Prohibition on United States assistance and financing
(a) Prohibition on United States assistance

(1) In general Notwithstanding any other provision of law, no United States Government assistance, including United States foreign assistance, United States export assistance, and any United States credit or guarantees shall be available for exports to Cuba or for commercial exports to Iran, Libya, North Korea, or Sudan.
(2) Rule of construction
Nothing in paragraph (1) shall be construed to alter, modify, or otherwise affect the provisions of section 6039 of this title or any other provision of law relating to Cuba in effect on the day before October 28, 2000.
(3) Waiver
The President may waive the application of paragraph (1) with respect to Iran, Libya, North Korea, and Sudan to the degree the President determines that it is in the national security interest of the United States to do so, or for humanitarian reasons.

However, the United States Department of Transportation believes no law impedes its two top officials from traveling (thus promoting and assisting) on inaugural commercial flights from the United States to the Republic of Cuba and the United States Department of State believes no law impeded a Deputy Assistant Secretary of State and the Chairman of the United States Federal Communications Commission from including representatives of United States-based companies in an official delegation to the Republic of Cuba.

In October 2015, The Honorable Penny Pritzker, United States Secretary of Commerce, states that United States law prevents her from being accompanied by and assisting representatives of United States-based companies during her visit to the Republic of Cuba.

In November 2015, The Honorable Thomas Vilsack, United States Secretary of Agriculture, states that United States law prevents him from being accompanied by and assisting representatives of United States-based companies during his visit to the Republic of Cuba.

In January 2016, The Honorable (Ambassador) Daniel Sepulveda, Deputy Assistant Secretary of the Bureau of Economic and Business Affairs of the United States Department of State, and The Honorable Thomas Wheeler, Chairman of the United States Federal Communications Commission, visit the Republic of Cuba; and representatives of United States-based companies are included in the official delegation.

In August 2016, The Honorable Anthony Foxx, United States Secretary of Transportation, travels aboard a JetBlue Airways inaugural flight from Fort, Lauderdale, Florida, to Santa Clara, Republic of Cuba, before returning to the United States aboard a government aircraft.

In November 2016, The Honorable Victor Mendez, United States Deputy Secretary of Transportation, travels aboard an American Airlines inaugural flight from Miami, Florida, to Havana, Republic of Cuba.

Blog Post Reference: http://www.cubatrade.org/blog/2016/11/5/usda-hubris-usda-illegality-for-the-inspector-general-why-is-this-an-issue

Deputy Secretary Of Transportation Travels To Havana On American Airlines Inaugural Flight

Havana Flights Mark Important Milestone in Re-engagement with Cuba‎

Posted by Deputy Secretary of Transportation Victor Mendez

28 November 2016

"Today, for the first time in more than fifty years, a scheduled, commercial flight took off from the United States and landed in Havana, Cuba. I had the privilege of joining the passengers and crew on that flight [American Airlines] this morning as it left Miami and made the one hour journey across the Florida Strait, marking another important milestone in our ongoing efforts to reengage with Cuba.

President Obama took the historic step last year of declaring that it was time to “begin a new journey” with the Cuban people. Since then, under the president’s leadership, Transportation Secretary Anthony Foxx and all of us at the Department of Transportation have been working to reestablish scheduled, commercial air service between our two countries, creating new opportunities for eligible travelers from the United States to visit Cuba.

The first scheduled flights to Cuba resumed this summer, connecting five U.S. cities with nine destinations across Cuba. Secretary Foxx was on the first of those flights on August 31, and by the end of this month, U.S. air carriers will have conducted nearly 940 round trip flights on those routes.

With today’s flight, we are adding Havana to the list of Cuban cities connected to the U.S. by direct, scheduled service. By the end of 2016, airlines are planning to conduct well over 500 round trip flights – with more than 90,000 passenger seats available – between Havana and the cities of Atlanta, Charlotte, Fort Lauderdale, Houston, Los Angeles, Miami, Newark, New York City, Orlando, and Tampa.

The numbers themselves are impressive, and they underscore the significant benefits that President Obama’s policy of re-engagement is having for both the American and the Cuban people.

The return of scheduled, commercial air travel, is bringing together families, providing important education and cultural benefits to both countries, and opening up business and economic opportunities. As the President said on Saturday, in the days ahead, the Cuban people will recall the past and also look to the future.

As they do, the Cuban people must know that they have a friend and partner in the United States of America. The steps we have taken over the last two years have brought us closer together and flights like these build on that progress as we look to improve the lives of the Cuban people and advance the interests of the United States.‎"

NOTE: In August 2016, The Honorable Anthony Foxx, United States Secretary of Transportation, traveled aboard a JetBlue Airways inaugural flight from Fort, Lauderdale, Florida, to Santa Clara, Republic of Cuba, before returning to the United States aboard a government aircraft.  Mr. Mendez returned to the United States using a regularly-scheduled commercial aircraft.

First US-HAV Flights On Monday; Trump (Administration) Response? Title III

The re-establishment on Monday, 28 November 2016 of the first regularly-scheduled non-stop commercial flights from the United States to Havana, Cuba, and return provide a highly-visible and an additional measure of normalcy in an anything-but-normal bilateral commercial, economic and political relationship.

Round-trip services from the United States to Jose Marti International Airport (HAV) in Havana, Republic of Cuba, commence with American Airlines & JetBlue Airways on 28 November 2016; United Airlines on 29 November 2016; Delta Air Lines, Frontier Airlines and Spirit Airlines on 1 December 2016; Southwest Airlines on 12 December 2016; and Alaska Airlines on 5 January 2017.

In some respects, the flights are Potemkinesque- camouflaging the real and imagined issues that each country has with the other; but doing so in a picturesque manner… with the expectation that the one-dimensional will become three-dimensional.

The commencement of the flights will increase already unrelenting pressures upon the hospitality infrastructure of Cuba, particularly airports, ground transportation and hotels- which will continue to unnaturally restrict capacity and create reasons for travelers to select alternative destinations in the short-to-medium term.

Individuals associated with President-Elect Donald J. Trump, both officially and unofficially, are not enthusiastic about the resumption of the flights; they view each flight as a satchel of United States currency traveling on a one-way journey to Cuba- with no meaningful measurable return other than to perpetuate abhorrent commercial, economic and political systems.  And, most significantly, they will view the passengers on those flights as “tourists”- in violation of United States law, not policy or regulation, per provisions of the Trade Sanctions Reform and export Enhancement Act (TSREEA) of 2000 which created twelve (12) categories of authorized travelers; with tourism specifically prohibited.

Members of the United States Congress will share their expectation that a Trump Administration will eliminate or reduce the flights.

Reasonable to expect that the Trump Administration will direct the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury to increase enforcement to ensure that only TSREEA-authorized travelers are using the flights- and the OFAC will have a position that both the “letter” and the “spirit” of the categories will be enforced.  The result would be a decrease in the number of passengers using the flights and impact overall visitor revenues to the Republic of Cuba.

The President-Elect, his transition team, and supporters may initiate a discussion relating to the implementation of Title III of the Libertad Act of 1996.  This provision enables those with assets expropriated by the government of the Republic of Cuba to bring lawsuits in United States Federal Courts.  The Libertad Act requires the president to either enable or suspend the provision every six months; and Presidents Clinton, Bush and Obama have done so.  

Secretary's Determination under Title III of Libertad
Bureau of Western Hemisphere Affairs
Washington, DC

July 15, 2016

The Secretary of State reported on July 11, 2016 to the appropriate congressional committees that, consistent with Section 306(c)(2) of the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996 (Public Law 104-114; 22 U.S.C. 6021-6091) and the authority delegated to the Secretary by the President on January 31, 2013, the Secretary had made the statutorily-required determination in order to suspend for six months beyond August 1, 2016 the right to bring an action under Title III of the Act.

Secretary's Determination of Six Months' Suspension under Title III of Libertad
Bureau of Western Hemisphere Affairs
Washington, DC

January 21, 2016

The Secretary of State reported on January 14, 2016 to the appropriate congressional committees that, consistent with Section 306(c)(2) of the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996 (Public Law 104-114; 22 U.S.C. 6021-6091) and the authority delegated to the Secretary by the President on January 31, 2013, the Secretary had made the statutorily required determination in order to suspend for six months beyond February 1, 2016, the right to bring an action under Title III of the Act.

The next decision upon a suspension must be by the end of January 2017; President Obama could (and will likely) suspend Title III before he departs office at 12:00 pm on 20 January 2017, thus providing at least six months of reprieve- and an opportunity for United States companies to advocate for continued suspensions.

The President-Elect, his transition team, and supporters may view creating uncertainty about the statue of Title III as an effective means of destabilizing the interest by the United States business community toward the Republic of Cuba; and it would be successful.

For example, there are individuals who maintain they have Title III-actionable claims relating to HAV and port at Santiago de Cuba.  In the case of HAV, United States-based air carriers and those from other countries could find their assets attached if they do not avoid Cuba.  In the case of the port at Santiago de Cuba, passenger cruise ships and cargo ships might avoid docking and unloading for fear of expensive and enduring legal proceedings.   

If President Obama leaves the decision to suspend Title III to President Trump in January 2017, expect that there would be a suspension.  However, there would likely be an aggressive signing statement (see below President Clinton’s in 1996) accompanying the document to be delivered to the United States Congress designed to create uncertainty relating to what will happen six months from January 2017.


Statement on Signing the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996
March 12, 1996

Today I have signed into law H.R. 927, the "Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996." This Act is a justified response to the Cuban government's unjustified, unlawful attack on two unarmed U.S. civilian aircraft that left three U.S. citizens and one U.S. resident dead. The Act imposes additional sanctions on the Cuban regime, mandates the preparation of a plan for U.S. assistance to transitional and democratically elected Cuban governments, creates a cause of action enabling U.S. nationals to sue those who expropriate or "traffic" in expropriated properties in Cuba, and denies such traffickers entry into the United States. It is a clear statement of our determination to respond to attacks on U.S. nationals and of our continued commitment to stand by the Cuban people in their peaceful struggle for freedom.

Immediately after Cuba's brutal act, I urged that differences on the bill be set aside so that the United States could speak in a single, strong voice. By acting swiftly—just 17 days after the attack—we are sending a powerful message to the Cuban regime that we do not and will not tolerate such conduct.

The Act also reaffirms our common goal of promoting a peaceful transition to democracy in Cuba by tightening the existing embargo while reaching out to the Cuban people. Our current efforts are beginning to yield results: they are depriving the Cuban regime of the hard currency it needs to maintain its grip on power; more importantly, they are empowering the agents of peaceful change on the island. This Act provides further support for the Administration's efforts to strengthen independent organizations in Cuba intent on building democracy and respect for human rights. And I welcome its call for a plan to provide assistance to Cuba under transitional and democratically elected governments.

Consistent with the Constitution, I interpret the Act as not derogating from the President's authority to conduct foreign policy. A number of provisions—sections 104(a), 109(b), 113, 201, 202(e), and 202(f)—could be read to state the foreign policy of the United States, or would direct that particular diplomatic initiatives or other courses of action be taken with respect to foreign countries or governments. While I support the underlying intent of these sections, the President's constitutional authority over foreign policy necessarily entails discretion over these matters. Accordingly, I will construe these provisions to be precatory.

The President must also be able to respond effectively to rapid changes in Cuba. This capability is necessary to ensure that we can advance our national interests in a manner that is conducive to a democratic transition in Cuba. Section 102(h), concerning the codification of the economic embargo, and the requirements for determining that a transitional or democratically elected government is in power, could be read to impose overly rigid constraints on the implementation of our foreign policy. I will continue to work with the Congress to obtain the flexibility needed if the United States is to be in a position to advance our shared interest in a rapid and peaceful transition to democracy in Cuba.

Finally, Title IV of the Act provides for the Secretary of State to deny visas to, and the Attorney General to exclude from the United States, certain persons who confiscate or traffic in expropriated property after the date of enactment of the Act. I understand that the provision was not intended to reach those coming to the United States or United Nations as diplomats. A categorical prohibition on the entry of all those who fall within the scope of section 401 could constrain the exercise of my exclusive authority under Article II of the Constitution to receive ambassadors and to conduct diplomacy. I am, therefore, directing the Secretary of State and the Attorney General to ensure that this provision is implemented in a way that does not interfere with my constitutional prerogatives and responsibilities.

The Cuban regime's lawless downing of two unarmed planes served as a harsh reminder of why a democratic Cuba is vitally important both to the Cuban and to the American people. The LIBERTAD Act, which I have signed into law in memory of the four victims of this cruel attack, reasserts our resolve to help carry the tide of democracy to the shores of Cuba.

WILLIAM J. CLINTON
The White House, March 12, 1996.

Complete Text In PDF Format

The Passing Of Fidel Castro- Impact Upon US/Cuba Bilateral Relationship

The passing of H.E. Dr. Fidel Castro Ruz, former president of the Republic of Cuba, will neither have immediate nor consequential commercial, economic or political impact upon the lives of the 11.3 million citizens of the Republic of Cuba.

The bilateral relationship with the United States- as the Obama Administration transitions to the Trump Administration, will have a change in trajectory, especially with the scope and pace of response(s) by the United States Congress.

With the announced retirement of H.E. General Raul Castro, president of the Republic of Cuba, on 24 February 2018, there will be efforts by members of the United States Congress, in conjunction with the Trump Administration, to publicize what the United States government can and will do once there is a "Post Castro" Cuba.

For the United States business community, the passing of former president Fidel Castro will have no short-term to medium-term impact; the government of the Republic of Cuba will retrench to demonstrate that the "Revolution" survives its founder- and continues to defy the grasp of the United States.

Discover Card Joins Wells Fargo, Citibank & ABA With Unsettling Statements About Cuba Transactions

On 22 November 2016, Riverwoods, Illinois-based Discover Financial Services provided the following response in reply to questions submitted by the U.S.-Cuba Trade and Economic Council:

"Discover Financial Services (NYSE: DFS) is a direct banking and payment services company with one of the most recognized brands in U.S. financial services. Since its inception in 1986, the company has become one of the largest card issuers in the United States. The company issues the Discover card, America's cash rewards pioneer, and offers private student loans, personal loans, home equity loans, checking and savings accounts and certificates of deposit through its direct banking business. It operates the Discover Network, with millions of merchant and cash access locations; PULSE, one of the nation's leading ATM/debit networks; and Diners Club International, a global payments network with acceptance in more than 185 countries and territories."

"Thanks for reaching out. Discover, together with our acquiring partners, is evaluating plans to support card acceptance in Cuba."  [NOTE: "An acquiring partner is an entity that we work through to gain acceptance for Discover at certain merchants."]

The response was to the following question:

In 2015, the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury re-authorized United States financial institutions to have their branded charge cards, credit cards and debit cards valid for use in the Republic of Cuba.

In 2015, New York, New York-based MasterCard International removed is restriction for the Republic of Cuba upon its branded products for use by individuals subject to United States jurisdiction.  An agreement was then reached with the Central Bank of the Republic of Cuba to implement the authorization.  There are more than 10,000 POS locations in the Republic of Cuba.

Since that time, Pompano Beach, Florida-based Stonegate Bank, San Juan, Puerto Rico-based Banco Popular de Puerto Rico, and Hollywood, Florida-based Natbank have authorized their MasterCard branded credit cards and debt cards for use in the Republic of Cuba.

In 2016, Stamford, Connecticut-based Starwood Hotels & Resort Worldwide (a subsidiary of Bethesda, Maryland-based Marriott International) began accepting United States-issued MasterCard products at its property in the Republic of Cuba, the Sheraton Four Points Habana.  The company has two more properties soon to be operational.

What is the current position of Discover with respect to authorizing its branded products for use by individuals subject to United States jurisdiction who visit the Republic of Cuba?

Wells Fargo Is Circumspect Regarding Cuba Transactions; Joining Citibank & ABA
November 16, 2016

San Francisco, California-based Wells Fargo & Company provided the following answer to a question relating to transactions with the Republic of Cuba:

[The U.S.-Cuba Trade and Economic Council] would appreciate learning the policy for Republic of Cuba-related transactions and the reason(s) for the policy(s).

“Wells Fargo considers processing a payment which is authorized under U.S. sanctions regulations on a case by case basis.”

"Wells Fargo & Company (NYSE: WFC) is a diversified, community-based financial services company with $1.9 trillion in assets. Founded in 1852 and headquartered in San Francisco, Wells Fargo provides banking, insurance, investments, mortgage, and consumer and commercial finance through more than 8,600 locations, 13,000 ATMs, the internet (wellsfargo.com) and mobile banking, and has offices in 42 countries and territories to support customers who conduct business in the global economy. With approximately 269,000 team members, Wells Fargo serves one in three households in the United States. Wells Fargo & Company was ranked No. 27 on Fortune’s 2016 rankings of America’s largest corporations. Wells Fargo’s vision is to satisfy our customers’ financial needs and help them succeed financially. In 2015, Wells Fargo donated $281.3 million to 16,300 nonprofits, ranking No. 3 on the Chronicle of Philanthropy’s rankings of the top corporate cash philanthropists. Wells Fargo team members volunteered 1.86 million hours in 2015, serving more than 40,000 nonprofits. Wells Fargo’s corporate social responsibility efforts are focused on three priorities: economic empowerment in underserved communities, environmental sustainability, and advancing diversity and social inclusion."

Citibank Declines To Comment On Processing Cuba Transactions
November 08, 2016

New York, New York-based Citibank (a subsidiary of New York, New York-based Citigroup) declined to comment when asked the following questions relating to transactions with the Republic of Cuba:

Does Citibank process Republic of Cuba-related transactions where a specific license is not required from the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury?

Does Citibank only process transactions where a license is required and provided to Citibank?

ABA Has No "Formal Position" About Cuban Banks Having Accounts With US Banks
November 08, 2016

Today, the Washington, DC-based American Bankers Association (ABA), stated that the organization does not have a formal position relating to the authorization of Republic of Cuba government-operated financial institutions to have accounts with United States-based financial institutions for correspondent activities.  The ABA did not provide a reason(s).

"The American Bankers Association is the united voice of America’s hometown bankers- small, regional and large banks that together employ more than 2 million people, hold more than $16 trillion in assets, safeguard $12 trillion in deposits and extend more than $8 trillion in loans.

ABA believes that government policies should recognize the industry’s diversity. Laws and regulations should be tailored to correspond to a bank’s charter, business model, hometown markets and risk profile. This policymaking approach avoids the negative economic consequences of burdensome, unsuitable and inefficient bank regulation.

Through a broad array of information, training, staff expertise and other resources, ABA supports America’s hometown bankers as they perform their critical role as drivers of America’s economic growth and job creation."

For reference:

http://www.cubatrade.org/blog/2016/10/16/has-the-obama-administration-called-it-quits-leaving-united-states-companies-with-more-than-was-expected-but-far-less-than-was-needed?rq=Direct%20Correspondent%20Banking

From Inside US Trade: Trump's economic transition landing teams include China, Cuba hardliners

Inside US Trade

Arlington, Virginia

22 November 2016

Trump's economic transition landing teams include China, Cuba hardliners

President-elect Trump's transition team on Nov. 19 announced “landing teams” for the Office of the U.S. Trade Representative and Commerce and Treasury departments with some personnel that have historically taken a hard line against China and Cuba when it comes to international trade.

Heading the USTR landing team is Dan DiMicco -- former CEO of Nucor, critic of NAFTA, and proponent of tariffs on Chinese goods -- and Robert Lighthizer, currently a partner at Skadden, Arps, Slate, Meagher & Flom LLP and former Deputy USTR in the Reagan administration and Senate Finance Committee chief of staff.

The Commerce landing team is composed of Ray Washburne, David Bohigian and Joan Maginnis. Washburne was a key Trump campaign fundraiser, while Bohigian advises financial services firms and other companies in his role as managing director at Pluribus Ventures. Maginnis works at the Commerce Department as assistant general counsel for finance and litigation.

On Tuesday, the Trump transition team also announced two additional members to the Commerce landing team: William Gaynor, the president and CEO of Rock Creek Advisors LLC, a consulting firm that deals with a range of international trade and investment issues, in addition to energy policy; and Tom Leppert, former CEO of the test preparation and education company Kaplan.

The Treasury Department hand-off will be overseen on the Trump side by William Walton, Curtis Debay, Judy Shelton, and Mauricio Claver-Carone. Walton is the chairman of Rappahannock Ventures LLC and Debay is a research fellow at the Heritage Foundation with a focus on tax and economic policy. Shelton is listed as a “self-employed economist” on the Trump transition webpage, and advised the Trump campaign on economic issues.

Claver-Carone is executive-director of the Cuba Democracy Advocates and also serves on the board of directors of the U.S.-Cuba Democracy PAC. Those organizations support the embargo on Cuba. Last week, he penned an op-ed in The Miami Herald slamming Obama's executive actions to relax barriers to trade and investment in Cuba for having “made a bad situation worse.”

John Kavulich, president of the U.S.-Cuba Trade and Economic Council, told Inside U.S. Trade that he is concerned that landing team members may be allowed access to files handled by the Treasury Department's Office of Foreign Assets Control, which oversees the regulatory and licensing processes required for U.S. companies to do business in Cuba. OFAC files such as “who has applied for a license, who has been denied a license, the text of licenses, policy guidance memorandums from other departments and agencies, and correspondence between applicants and OFAC,” should be off limits to the transition team, he said.

“Unless an individual is an employee of the United States Department of the Treasury, he/she should not be provided access to materials which may impact confidentiality- and competitive secrets; and, potentially be disclosed for political purposes,” Kavulich said.

“There is potential for misuse of information obtained by any Landing Team member when they are a policy advocate/lobbyist and may intend to return to that role,” he said.

The Trump team also added a name to the Treasury landing team on Tuesday -- Eileen O'Connor, who runs her own private law practice and has expertise in federal tax disputes. O'Connor was an Assistant Attorney General in the Justice Department from 2001-2007.

Also on Tuesday, Trump's transition team revealed that Bradley Bondi, a litigation partner at Cahill Gordon & Reindel LLP and leader of the firm's securities enforcement and regulatory practices division, will lead the landing team for the Export-Import Bank.

Whomever Trump ultimately picks to lead those agencies -- based on Trump's campaign rhetoric -- will have an ambitious agenda. Trump's USTR will be tasked with renegotiating NAFTA, potentially with a threat of U.S. withdrawal from the trade agreement.

Trump also said he would instruct the U.S Trade Representative to "bring trade cases against China, both in this country" and at the World Trade Organization.

Another Trump campaign promise: Direct the Commerce Department to review every U.S. trade agreement for violations and instructing federal agencies to "use every tool under American and international law to end these abuses.”

Trump's Commerce pick would also oversee efforts to hit China with high tariffs, as he pledged he would do while campaigning. -- Jack Caporal

Air Canada & UPS Deliver 1st Cancer Vaccine For Use In FDA-Approved Clinical Trial; RPCI Seeks US Carrier

Dorval, Canada-based Air Canada (a Star Alliance member along with Chicago, Illinois-based United Airlines), delivered 500 doses of vaccine (59 kilograms; pallet dimensions 80x60x76) from Jose Marti International Airport (HAV) to Toronto Pearson International Airport (YYZ) in Toronto, Canada, and then transported by Atlanta, Georgia-based United Parcel Service (UPS) truck to the Peace Bridge border crossing at Buffalo, New York, before being delivered to Roswell Park Cancer Institute (RPCI).

On 17 November 2016, vaccine from Cuba arrived to the RPCI's Investigational Pharmacy in perfect condition- taking 72 hours door-to-door.  The shipment passed United States Food and Drug Administration (FDA) inspection at the United States-Canada border without issue.

The first test shipment of saline from HAV to RPCI in October 2016 required ten (10) days due to issues with U.S. Customs and Border Protection (CBP).  As a result, RPCI created a spreadsheet with information required by Air Canada, Canada Border Services Agency (CBSA), CBP, and Buffalo District office of the FDA office, distributed that spreadsheet to the relevant parties and then followed up with them by telephone.

RPCI expects five (5) additional shipments through 20 January 2017 to supply the two clinical trials.

RPCI believes that the supply chain Standard Operating Procedure (SOP) is operational from the the point Republic of Cuba government-operated Center for Molecular Immunology (CIM) therapeutics enter Canada and then the United States.  

RPCI continues to seek a United States-based air carrier to handle the shipments so that the process is bilateral rather than trilateral.

http://www.cubatrade.org/blog/2016/11/14/who-will-provide-cargo-services-for-roswell-park-ual-del-aa-fdx-or-jbu?rq=Roswell%20park

http://www.cubatrade.org/blog/2016/11/8/from-the-atlantic-how-fedex-helped-commence-a-cancer-vaccine-clinical-trial

President-Elect Trump Announces Treasury Department Landing Team Member- Cuba Policy Focus

21 November 2016
Washington, DC

Department of the Treasury
Mauricio Claver-Carone
Employer (current or most recent): Cuba Democracy Advocates
Funding Source: Volunteer

From Wikipedia:

Mauricio Claver-Carone is an American advocate in support of the policy positions that the United States has taken against the Cuban government.

Claver-Carone was born in Florida and raised in Madrid, Spain. Before going into political advocacy, he was an attorney-advisor for the U.S. Department of the Treasury. He also served as a Clinical Assistant Professor at the Catholic University of America's Columbus School of Law and as an Adjunct professor at the George Washington University Law School. Claver-Carone earned his B.A. degree magna cum laude from Rollins College, J.D. cum laude from The Catholic University of America and LL.M. in International and Comparative Law from Georgetown University Law Center.

Claver-Carone is host of the foreign policy show "From Washington Al Mundo" on Sirius-XM's Cristina Radio (Channel 146). Poder Magazine has recognized him as one of 20 entrepreneurs, executives, leaders and artists under 40 who are shaping the future of the US and the world.

As a content expert, Claver-Carone writes regularly for The Huffington Post, and has been published in The Wall St. Journal, and the World Affairs Journal.

He has written numerous columns in support of US policies against the Cuban government, particularly the United States embargo against Cuba, and in favor of a transition on the island. He has taken part in various televised debates on US-Cuba relations.

He is Executive Director of Cuba Democracy Advocates. In an independent capacity, he also serves on the Board of Directors of the US-Cuba Democracy PAC, which purports to be the largest, single foreign-policy political action committee in the United States, and the largest Hispanic political action committee in history.

He is editor of the blog, Capitol Hill Cubans.


From Capitol Hill Cubans:

Mauricio Claver-Carone is the Executive Director of Cuba Democracy Advocates in Washington, D.C., a non-partisan organization dedicated to the promotion of human rights, democracy and the rule of law in Cuba.

In an independent capacity, Mauricio is a co-founder and Director of the U.S.-Cuba Democracy PAC, the largest, single foreign-policy political committee in the United States and the largest Hispanic political committee in history.

Mauricio previously served as an Attorney-Advisor for the U.S. Department of the Treasury. Prior to his work in government, he served as a Clinical Assistant Professor at The Catholic University of America's School of Law and an Adjunct Professor at The George Washington University's National Law Center.

A prodigious writer, Mauricio's work has been featured in numerous publications including: The New York Times, The Wall Street Journal, Politico, The Hill, The Georgetown Journal of International Law and the Yale Journal of International Affairs.

Were Obama Administration Initiatives Worth US$12 Billion To Cuba During Last 23 Months? Trump Administration Impact?

From 17 December 2014, the government of the Republic of Cuba may have earned and saved a combined US$12 billion as direct/indirect result of Obama Administration initiatives.   

The earnings which have been enhanced are primarily from 1) increased travel-related transactions- both United States-based (gross revenues exceeding US$900 million) and other country-sourced 2) increase in remittances (for use to create independent businesses, expanding existing independent businesses, real estate transactions, supporting friends and family, etc.) and 3) Direct Foreign Investment (DFI) projects (power generation, hospitality, manufacturing, assembly, etc.)- much of which has been announced but not yet delivered; announced estimates vary in value from US$1 billion to US$2 billion. 

The number of individuals subject to United States jurisdiction visiting the Republic of Cuba since 17 December 2014 has more than doubled; the per person spending by the individuals has increased substantially; the demographics of the visitors has expanded; and the prices for accommodations, meals, ground transportation, tours, etc., have increased dramatically.  

The majority of announced DFI value has been financed and/or had financing guaranteed by governments as opposed to the private sector, so there is often less incentive to seek full repayment if problems develop; and timetables for implementation often have greater flexibility.  Some DFI (and “soft loans” from governments for infrastructure and product imports) may have occurred irrespective of Obama Administration initiatives as they were self-sustaining projects or the governments supporting them were engaging with the Republic of Cuba for domestic political considerations and/or despite United States policies, regulations and statutes; for example, the People’s Republic of China, Islamic Republic of Iran, Republic of Turkey, and Russian Federation.  

The savings are from lessening of the perception of risk due to 1) the removal by the United States of the Republic of Cuba from the list of state sponsors of international terrorism 2) restoration of full diplomatic relations 3) impact of the visit to the Republic of Cuba by United States President Barack Obama 4) resumption of regularly-scheduled commercial airline flights 5) authorization of a hotel management contract (three properties) for a United States-based company 6) removing some restrictions upon the use of the United States Dollar for international transactions 7) publicity of increased visits to the Republic of Cuba by representatives of United States companies 8) increased presence (service providers particularly banks and MasterCard International; airlines) of United States-based companies 9) lower interest rates 10) expanded trade terms and 11) reduction in foreign debt.    

In December 2015, representatives of the Paris Club Group of Creditors of Cuba and of the government of the Republic of Cuba agreed arrangement that reduced debt of US$11.1 billion to US$2.6 billion; and provided the government of the Republic of Cuba with eighteen (18) years to make repayments with any remaining debt subject to a 1.5% annual interest rate.  Debt repayment discussions commenced in 2012 and gained momentum before December 2014.  Some of the debt may be converted to equity for new DFI projects.  The Group of Creditors of Cuba includes Australia, Austria, Belgium, Canada, Denmark, Finland, France, Italy, Japan, the Netherlands, Spain, Sweden, Switzerland and the United Kingdom.  While the debt reduction agreement may have been negotiated without consideration of Obama Administration initiatives, the structure (implementation) of the agreement did weigh the positive and negative impact of re-engagement with the United States within the context of the ability by the government of the Republic of Cuba to adhere to repayment schedules.  Before December 2014, the Russian Federation settled U.S.S.R.-era debt for approximately 10% of total value and debt to the Russian Federation.

France, Mexico (70% write-off in 2013) and Spain and China (approximately US$6 billion write-off in 2011) and United Kingdom have also continued to independently forgive or reduce debt owed by the Republic of Cuba.

Most of the important debt reduction work with other countries is in the form of long-term agreements which are insulated, but not immune to impact from changes in policy, regulation or statute by the Trump Administration.

Announced DFI could be impacted if those managing and financing the projects believe that obtaining required revenue to service debt becomes uncertain.

To make sovereign debt and commercial debt payments (including new debt) as scheduled, the Republic of Cuba depends upon 1) stable commodity prices for exports 2) stable commodity prices for imports (most importantly, agricultural commodities and oil) 3) increasing DFI 4) increasing tourism net profits 5) continuing short-term, medium-term and long-term government-to-government loans and grants and 6) continuing medium-term to long-term commercial financing for imports.  Without changes to the commercial, economic and political structures within the Republic of Cuba, there is little elasticity between fulfilling obligations and default on obligations.  

The Trump Impact

The perception that the Trump Administration may alter United States policy, regulations, and statutes could impact revenue streams to the Republic of Cuba- from visitors, from companies (exports, imports, provision of services, DFI), and from governments which would then impact ability to make payments for imports of goods and services and to service debt.

If there is a decrease in earnings of the Republic of Cuba which impacts ability to service debt, then re-negotiation would become problematic for the debtor and the holder(s) of the debt.  

How financial institutions located outside of the United States perceive Trump Administration risk associated with Republic of Cuba-related transactions will be central to the impact upon the Republic of Cuba.

Will the Trump Administration be proactive or reactive in terms of its relationship with the Republic of Cuba?  Likely migrate towards reactive- However, if the Republic of Cuba makes a provocative statement or takes a provocative action, with “provocative” defined by President Donald J. Trump- with the definition not static, the level of focus on the statement/action by media will be have considerable weight as a determinant to the degree of response.

The Republic of Cuba can do much to influence the behavior of the Trump Administration- by focusing limited effort upon being noticed by officials of the Trump Administration and by Members of the United States Congress.

Most United States companies, and the organizations representing them, modeled for the 8 November 2016 election result different from the outcome and, thus, are uncertain as to what the Trump Administration will create, replace and repeal; and whether and at what pace companies and organizations must alter their advocacy relating to the Republic of Cuba. 

United States companies and their supporting organizations may adopt a strategy of seeking from the Trump Administration a commitment not to eliminate, reverse or revise existing policy and regulatory structures in consideration of United States companies and their supporting organizations advocating for commercially-imperative issues which impact the United States economy with far greater meaning than does the Republic of Cuba.  The Return on Investment (ROI) from advocating about the Republic of Cuba has not become universally profitable. 

Advocates risk becoming insensitive to and discounting of a potentially intoxicating political narrative for a United States president to disconnect from the imagery associated with being the leader of the country when “Post-Castro Cuba” becomes a reality on 24 February 2018.  

For a president to be in office, and have an ability to transition through the closure of one chapter in the bilateral relationship and beginning of another chapter in the bilateral relationship, in this instance a fifty-nine -year-old text, will be far too tempting…. so, patience will be a focus.

Unknown is the impact of the relationship between The Honorable Paul Ryan, Speaker of the House of Representatives, and The Honorable Mike Pence (Governor of Indiana), the Vice President-Elect; and the impact of the National Security Council under retired Lt. General Michael Flynn. 

United States companies are now seeking to preserve the policy and regulatory status quo rather than obtain an expansion of opportunities.  This position is a direct result of advocates, some United States companies, and the government of the Republic of Cuba focusing upon seeking statutory changes by the United States Congress during the last twenty-three months rather than regulatory changes by the Obama Administration.  That was a mistake.

There is a developing constituency who believe Trump Administration policies, regulations and support of statutes will be influenced by the desire of Mr. Trump to create and preserve opportunities for The Trump Organization to license the Trump name to hotels, golf courses, and condominium projects in the Republic of Cuba.  That’s absurd.

The primary locations of those structures to which the Trump brand is affixed are in countries where there is a developed infrastructure, a wealthy government elite, a prosperous group of residents, a willing-to-spend group of expatriates, an entity having the capital to make licensing payments, and a rapid return-on-investment (ROI).  This is not an environment that exists in the Republic of Cuba nor will exist in the Republic of Cuba during the next four years.  Given the strategies of Mr. Trump during the 2016 campaign, he is not one to believe that perceived negative impact upon his brand is not surmountable; he can wait.  Mr. Trump believes in the resilience of his brand, regardless of short-term issues.  

For the Obama Administration, any further changes to regulations before 20 January 2017 would potentially invite a rigorous focus… as a cape is to a bull.  The issuance of licenses, however, may be accelerated to provide companies with an ability to have options for implementation before Inauguration Day; and licenses that extend for one or more years.

60 days until uncertainty becomes certainty……

Obama Administration Irony

Given the initiatives by President Obama, since his inauguration in January 2009 exports of food products and agricultural commodities under provisions of the Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000 have decreased from US$528,482,955.00 in 2009 to US$170,551,329.00 in 2015; thus far in 2016, at US$169,482,206.00, they have increased 16% for the first nine months of the year.  For 2016, there will be the first yearly increase since 2011/2012.  

However, healthcare product exports from the United States to the Republic of Cuba in 2009 were US$85,408.00; and in 2015 were US$4,486,966.00.  Thus far in 2016, exports were US$2,174,372.00.  These exports are authorized under the Cuban Democracy Act (CDA) of 1992.  

There was an expectation by the United States business community that the government of the Republic of Cuba would increase its import of products and purchase of services from the United States due to the value of the initiatives by the Obama Administration.  This expectation was misplaced, thus far.

There was an expectation by the United States business community that the Obama Administration would create as many regulatory opportunities as possible and end its term with only (or nearly) a need for changes to statutes.  This expectation was misplaced, thus far. 

Since December 2001, thirty-five (35) ports in the United States- from Virginia to Florida to Alabama to Louisiana and Texas have been the transit point for more than 4.6 million metric tons of food products and agricultural commodities exported from the United States to the Republic of Cuba. 

The value of those exports? US$5,251,726,914.00 and all on a payment of cash in advance basis, as required by United States law.  The best year was 2008 with US$710,086,323.00 and the worst year was 2015 with US$170,551,329.00.

Of 232 global export markets for food products and agricultural commodities from the United States, the Republic of Cuba has ranked from 25th to 60th.  

What has the United States exported?  Poultry, Soy products, Corn, Calcium Phosphates, Pork, Beef, Rice, Cotton, Wood, Wheat, Newsprint, Brewing Dregs, and products found in supermarkets.

The Republic of Cuba has also become a small export market for healthcare products (medical equipment, medical instruments, medical supplies and pharmaceuticals).  From 2003 through this year, the total value is US$13,194,905.00.

Since 17 December 2014, the government of the Republic of Cuba has purchased one (1) piece of agricultural equipment valued at approximately US$140,000.00 from a United States-based company; the equipment, which was due to be delivered in June 2016, has yet to be delivered.

Complete Text In PDF Format

Companies Seeking Licenses From The OFAC Or BIS Have 60 days.... Or Face Uncertainty

If a United States-based company or United States-based subsidiary of a non-United States-based company has 1) a license application pending before the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury or Bureau of Industry and Security (BIS) of the United States Department of Commerce or 2) has considered, but not applied for a license from the OFAC or BIS, they are advised to move swiftly to secure a license.

A license issued by the OFAC or BIS is generally valid for one-year or more; so having an executable license prior to 20 January 2017 will be of value as the Trump Administration might not invalidate a license previously issued.

Having a license be active (exports, imports, provision of services, etc.) prior to 20 January 2017 would provide greater insurance against the invalidation of a license that exists, but has not had components implemented.

Most Secretive Visit By A Governor? West Virginia; No Mention On State's Web Site Until Two Days After Return

The Honorable Earl Ray Tomblin (D), Governor of West Virginia, visited the Republic of Cuba for two days (17 November 2016 to 19 November 2016) with representatives of West Virginia-based public sector and private sector entities; no information was provided about the visit at www.wv.gov or www.governor.wv.gov

This was the most secretive visit to the Republic of Cuba by any United States governor.

"Governor Tomblin Joins Department of Commerce for Trade Mission to Cuba

11/21/2016
West Virginia businesses highlighted for new export opportunities

CHARLESTON, W.Va. (November 21, 2016) – Gov. Earl Ray Tomblin returned Saturday from a two-day trade mission to Cuba, where he accompanied officials from the West Virginia Department of Commerce to pursue new trade opportunities between the state and country. The delegation was joined by officials from Pilgrim’s Pride, Multicoat and Industrial Bolting Technologies, who were all looking to grow their export potential.  

“Our goal was to highlight West Virginia’s outstanding exporters and pursue opportunities for trade between our state and Cuba, and I believe we did so with great success,” Gov. Tomblin said. “Like other governors across the country, I believed it was extremely important to take advantage of the new opportunity before us to visit with Cuban officials as the U.S. and Cuba have recently started to normalize trade relations. In today’s economy, exporting is vital for business success – and this is another opening for us to take the Mountain State to the world market.”

“We went into this trade mission without any expectations, and I can tell you it exceeded any hopes we could have had. Last week, we learned that Cuba has a strong economic market for many products, including our own. We believe this will be a game changer for our product,” said Multicoat Vice President John Dill, who was a member of the delegation. “I normally spend the Monday before Thanksgiving in a tree stand, but I’m so excited about these new opportunities that I’m already in the office following up on leads we established. We appreciate Governor Tomblin leading this mission and for the state giving us the opportunity to be a part of the state’s sales team.”

“During my time as governor, I have had the privilege of representing the people of West Virginia by traveling across the country and around the world and sharing what makes our state a great place to live, work and do business,” Gov. Tomblin said. “I was pleased to share with Cuban officials not only more information about the goods and services West Virginia offers, but also our state’s dependable workers who have allowed so many of our businesses to grow local operations to a global scale.”

This visit marked Gov. Tomblin’s sixth and final international mission, and the first focused primarily on developing new trade and export opportunities for West Virginia businesses. In 2015, West Virginia businesses exported goods and services to more than 141 countries totaling $5.8 billion."

A