On September 21, 2015, the Department of Commerce’s Bureau of Industry and Security (BIS) published amendments to the Export Administration Regulations (EAR) in support of the Administration’s new policy toward Cuba. This action builds upon the regulatory changes published in January of this year, which paved the way for increased trade and engagement with Cuba, and the recent rescission of Cuba’s designation as a State Sponsor of Terrorism. BIS’s rule, published in conjunction with amendments to the Cuban Assets Control Regulations, aims to encourage engagement between the U.S. and Cuban people by expanding authorizations for exports and reexports to Cuba and removing certain unintended restrictions on such transactions.
BIS made several revisions to License Exception Support for the Cuban People (SCP) to further promote exports and reexports that improve living conditions in Cuba; embolden Cuba’s private sector; strengthen civil society in Cuba; and facilitate the free flow of information to, from, and within Cuba. For example:
- BIS removed the requirement that items authorized for export to Cuba for private sector use and for telecommunications be “sold or donated,” thereby explicitly authorizing leases, loans, and other types of transactions.
- BIS also expanded the temporary exports authorized under this exception. The exception now allows, for example, travelers to take company or personally-owned laptops or mobile devices classified as EAR99 or controlled for export only for anti-terrorism reasons (e.g., a mass market smartphone) to Cuba for the traveler’s use in professional meetings and research.
- BIS added a new authorization permitting exports and reexports of commodities and software classified as EAR99 or controlled only for anti-terrorism reasons to individuals and private sector entities in Cuba to facilitate these individuals’ and entities’ development of software meant to improve the free flow of information or otherwise support the private sector activities identified in License Exception SCP.
- The rule also adds a new authorization permitting exports and reexports to Cuba of certain items subject to low-level export controls for use by eligible end-users to establish, maintain, or operate a physical presence in Cuba.
- For companies interested in promoting their businesses in Cuba, the rule authorizes EAR99 items that are normally given away for free as gifts for promotional purposes—such as pens, hats, or t-shirts—to be exported and reexported to Cuba.
BIS’s amendments are not limited to License Exception SCP. BIS also made revisions to other license exceptions, its licensing policy for items that ensure safety in civil aviation, and its deemed export and reexport policy for Cuba. A comprehensive analysis of the changes to U.S. export controls applicable to Cuba can be found here.
Although the Cuba embargo remains in place, BIS’s new rule represents another important step in the continuing evolution of the U.S. government’s policy on Cuba and should contribute to the Administration’s goal of building a stronger, more open relationship between the two countries.