Review of license exception for exports to Cuba

Review of license exception for exports to Cuba

The Bureau of Industry and Security (BIS) of the U.S. Commerce Department may grant a license exception for U.S. companies exporting certain items to Cuba when such items having the purpose of:

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  • Improving living conditions and supporting independent economic activity
  • Strengthening civil society
  • Improving communications to, from, and among the Cuban people may benefit from the January 16, 2015, BIS license exemption.

Prior to January 16, 2015 (the date of publication of the revised rules in the Federal Register), any export or re-export of products to Cuba subject to the EAR would require a license from BIS, and generally, applications for export licenses for trade with Cuba were denied.

New license exception

As part of the U.S. government’s efforts to chart a new course in bilateral relations with Cuba, BIS has implemented a new license exception (known as “support for the Cuban people” or SCP) that, among other changes to the EAR, authorizes the export of certain items that fall under new exception.

Major elements of these changes, in the revised regulations, are specifically aimed as “support for the Cuban people” and include:

 

  • Exports and re-exports providing support for the Cuban people in three areas—improving living conditions and supporting independent economic activity, strengthening civil society, and improving communications—will be eligible under the SCP license exception.
  • To improve living conditions and support independent economic activity, the SCP license exception will authorize: (1) building materials, equipment, and tools for use by the private sector to construct or renovate privately owned buildings, including privately owned residences, businesses, places of worship, and building for private sector social or recreational use; (2) tools and equipment for private agricultural activity; and (3) tools, equipment, supplies, and instruments for use by private sector entrepreneurs.
  • To strengthen civil society, the SCP license exception will authorize export and re-export of donated items and temporary export and re-export by travelers to Cuba of items for use in scientific, archaeological, cultural, ecological, educational, historic preservation, or sporting activities. The SCP license exception will also authorize exports and re-exports to human rights organizations, individuals, or non-governmental organizations that promote independent activity intended to strengthen civil society.
  • Travelers will be able to export temporarily items for use in professional research in the traveler’s profession or full-time field of study under the SCP exception. The activities or research, however, must not be related to items on the U.S. Munitions List or items controlled for “sensitive reasons” on the Commerce Control List.
  • To improve communications, the SCP license exception will authorize exports and re-exports of items for use by news media personnel and U.S. news bureaus.
  • The SCP exception will not authorize the export of items on the Commerce Control List for “sensitive reasons” such as national security, nuclear proliferation, regional stability, missile technology, and other reasons of similar sensitivity.
 
For more information, contact a professional with KPMG’s Trade & Customs practice:
Douglas Zuvich | +1 (312) 665-1022 | dzuvich@kpmg.com
Andrew Siciliano | +1 (631) 425-6057 | asiciliano@kpmg.com
 
Or your local KPMG Trade & Customs professional.

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