U.S. announces sweeping changes easing restrictions on business, travel to Cuba

The United States Departments Treasury and Commerce on Friday issued new regulations further easing restrictions on Americans travelling to and doing business in Cuba.

U.S. companies will be able to open offices on the island and engage in joint business ventures there, while individuals with relatives in Cuba will have more travel opportunities for people and the limit to the amount of money that can be sent people on the island are being eliminated.

The new rules, which go into effect on Monday, September 21st, are the latest steps taken by the White House and President Barack Obama to weaken the U.S. trade embargo and normalize relations with the communist island.

Under the new regulations, certain U.S. companies may now have a physical presence on the island, such as an office, retail store or warehouse. News bureaus, exporters of goods, mail service companies, telecommunications or internet companies, businesses associated with educational activities, religious organizations and certain travel services can set up offices there, employ Cuban nationals and open bank accounts on the island.

Starting Monday, the new rules will also make it easier for cruise ships, ferries and other recreational vessels, including aircraft, to go to Cuba.

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The new rules allow for joint ventures between Cuban and American businesses. This is especially vital for telecommunications and internet companies looking to offer their services on the island, where the telecommunications infrastructure is completely owned by the government-owned ETECSA.

“We made this change in large part because we got large feedback from industry,” a senior administration official said on a Friday conference call about the new regulations. “We contemplate that a potential joint venture may happen between U.S. companies and the Cuban government company of ETECSA.”

As part of the easing of restrictions, close relatives – defined as someone related to a person in Cuba by blood, marriage or adoption – can now travel to the island for a larger number of reasons – including journalistic and professional research, religious reasons and for humanitarian projects.

All travelers can now open a bank account in Cuba as well.

The new rules also eliminate the limit on remittances – money sent to individuals on the island from those in the U.S. Before the rule change, the maximum was $2,000 dollars per quarter.

“A stronger, more open U.S.-Cuba relationship has the potential to create economic opportunities for both Americans and Cubans alike,” Treasury Secretary Jacob J. Lew said in a press release. “By further easing these sanctions, the U.S. is helping support the Cuban people in their effort to achieve the political and economic freedom necessary to build a democratic, prosperous and stable Cuba.”

Supporters of lifting of the Cuban embargo applauded the move. The pro-democracy advocacy group #CubaNow, for one, called the latest regulation changes a “momentous step.”

"We urge Cuban leaders to lift restrictions prohibiting their citizens from fully benefiting from the expanded access to U.S. goods, services and know-how that is now within their reach,” executive director Ric Herrero said in a statement. "At the same time, we ask the U.S. Congress to put partisanship aside, dismantle what is left of the failed embargo and firmly commit itself to advancing the interests of the American and Cuban peoples."

The announcement was not received with the same enthusiasm by prominent Cuban-Americans in Congress who have opposed easing restrictions on the government of Raúl Castro.

“The sad reality is that the Castro regime is taking full advantage of the Obama administration’s willingness to concede on loosening the regulations while expecting nothing in return from the communist dictatorship,” U.S. Rep. Ileana Ros-Lehtinen (R-Florida). “Our regulations do not have to change. It is Cuba that needs to change, and the Castro brothers will not let that happen.”

Senior administration officials concede that these changes are contingent on what the Cuban government will allow to happen. As one senior administration official on the conference call put it, “We don’t have control there.”

It depends on the willingness of the government to meet the U.S. halfway. The administration's position is that the most effective way to empower the Cuban people is to increase social and economic ties with the island.