Unbeknownst to a large number of U.S. businesses entering into the burgeoning telecommunications space is that it may be very possible to expand their business operations into Cuba. While it is true that there are still sanctions imposed upon Cuba, there is a general license found in the Cuban Assets Control Regulations (“CACR”) administered by the United States Department of the Treasury Office of Foreign Assets Control (“OFAC”) which authorizes a wide range of activities related to transactions with Cuba which may be carried out by U.S. telecommunications service providers.

Generally speaking almost all transactions incident to the provision of telecommunications services, tsatellite radio or satellite television services, or the entry into and performance under roaming service agreements with telecommunications services providers in Cuba are authorized.

In addition, transactions incident to the establishment of facilities to provide telecommunications services linking the United States and Cuba are authorized. However, for similiar activities linking third party countries with Cuba, the U.S. entity will need to obtain specific license authorization from OFAC.

Moreover, this general license does have contain some reporting requirements not typically found in general licenses. For example, any U.S. entity seeking to operate under the authority of the general license must first notify OFAC in writing within 30 days of commencing or ceasing to offer such services. Moreover, these entities are required to furnish to OFAC by January 15 and July 15 of each year semiannual reports providing the total amount of all payments made to
Cuba or a third country related to any of the services authorized pursuant to the general license.

However, as always this general license does not authorize any transactions with those parties designated on OFAC’s Specially Designated Nationals (SDN) List.

While making use of this general license could be very profitable for U.S. service providers, there are still a number of considerations that come along with its use. Those seeking to provide services pursuant to this general license should first seek advice of legal counsel and be fully aware of all requirements imposed by the general license and any potential pitfalls which may occur from its use.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrari-legal.com.