"Publication of New Frequently Asked Question (FAQ) on Basic Information and Updated FAQs on Cuba Sanctions"

Publication of New Frequently Asked Question (FAQ) on Basic Information and Updated FAQs on Cuba Sanctions 

“The Department of the Treasury's Office of Foreign Assets Control (OFAC) is publishing one new, basic information Frequently Asked Question (FAQ 1190). OFAC is also publishing two amended Frequently Asked Questions (FAQ 736 and FAQ 757) related to the Cuban Assets Control Regulations (CACR).  For more information on this specific action, please visit our Recent Actions page.”

“1190. Do U.S. sanctions target persons for engaging in political speech, religious practice, or other constitutionally protected activities?

OFAC does not sanction persons for their engagement in activities subject to U.S. constitutional protection, such as protected speech or religious practice or for their religious beliefs; nor do U.S. persons violate OFAC sanctions for engaging in such constitutionally protected activity. Furthermore, additional limitations and authorizations are in place to ensure that U.S. sanctions do not restrict the exchange of information or informational materials, or personal communication. The majority of OFAC sanctions programs are promulgated pursuant to the International Emergency Economic Powers Act, 50 U.S.C. 1701 et seq., which limits the authority to “regulate or prohibit, directly or indirectly . . . any postal, telegraphic, telephonic, or other personal communication, which does not involve a transfer of anything of value . . . or, the importation from any country, or the exportation to any country, whether commercial or otherwise, . . . of any information or informational materials.” 50 U.S.C. § 1702(b)(1), (3).  No authorization is necessary for U.S. persons to engage in activities that are not prohibited by or are otherwise exempt from sanctions. If you are concerned that potential sanctions may interfere with constitutionally protected activities, please reach out to OFAC for further guidance as described here.  Date Released August 27, 2024

736. May the U.S. dollar be used to conduct transactions in Cuba or with Cuban nationals?

Yes, under certain circumstances. Persons subject to U.S. jurisdiction may engage in transactions in U.S. dollars in Cuba or with Cuban nationals with respect to activity that is authorized pursuant to the Cuban Assets Control Regulations (CACR). For example, payments for telecommunications services in Cuba provided pursuant to 31 CFR § 515.542 may be provided in U.S. dollars. Further, the use of U.S. dollars for transactions that are exempt from the prohibitions of, or authorized by, the CACR is also allowed. For example, payments related to the importation or exportation of informational materials as defined in 31 CFR § 515.332, such as books or musical recordings, may be made in U.S. dollars.  Additionally, the May 29, 2024 amendment to section 515.584(d) of the CACR authorizes banking institutions subject to U.S. jurisdiction to process transactions originating and terminating outside the United States, provided that neither the originator nor the beneficiary is a person subject to U.S. jurisdiction (“U-turn general license”). As a result, transactions related to third-country commerce involving Cuba or Cuban nationals may be processed in U.S. dollars through the U.S. financial system via banking institutions located in the United States that serve as intermediary banks, provided that neither the originator nor the beneficiary is a person subject to U.S. jurisdiction. For more information on the “U-turn” general license, please see FAQ 757.  OFAC expects U.S. banks, including their foreign branches and subsidiaries, to conduct due diligence on their own direct customers (including, for example, ownership structure (for entities), proof of citizenship (for individuals), and address information to confirm that the transactions being processed are consistent with the U-turn general license. All banks, including those acting solely as intermediaries, should screen against the OFAC SDN List and their own internal filters. In cases where the remitter or beneficiary of the transaction is not a direct customer, the U.S. banking institution that is acting as an intermediary may rely on the remitter’s or beneficiary’s address as stated in the transaction to determine whether the remitter or beneficiary is a person subject to U.S. jurisdiction, unless the U.S. banking institution knows or has reason to know that the remitter or beneficiary of a transaction is a person subject to U.S. jurisdiction. OFAC will consider the totality of the circumstances surrounding the bank’s processing of transactions where a bank is acting solely as an intermediary and fails to block a prohibited transaction engaged in by a person subject to U.S. jurisdiction, including the factors listed above, to determine what, if any, enforcement action to take against the bank. Note, however, that transactions meeting the requirements of 31 CFR § 515.584(d) may be processed notwithstanding the involvement of a specially designated national of Cuba, as defined in 31 CFR § 515.306, in the transaction. The examples below illustrate some of the transactions and parties that may use the U-turn general license.  Date Updated: August 27, 2024

757. Are U.S. banking institutions authorized to process “U-turn” transactions in which Cuba or a Cuban national has an interest?

Yes. Effective May 29, 2024, banking institutions subject to U.S. jurisdiction are authorized to process “U-turn” transactions, i.e., funds transfers originating and terminating outside the United States, provided that neither the originator nor the beneficiary is a person subject to U.S. jurisdiction. For a complete description of what this general license authorizes and the restrictions that apply, see 31 CFR § 515.584(d). For additional information, see FAQ 736.  Date Updated: August 27, 2024”