Main Menu

The Times Are Changing, But Very Slowly

MSK Client Alert
July 21, 2015

First, we learned relations with Cuba were thawing, and now – on July 14th – there is the nuclear deal with Iran. Many American companies are clambering to make commercial deals with businesses in both countries – but not so fast! In fact, little has changed in terms of U.S. relations with either country, at least at the business level, although significant changes are likely in the future. With Cuba and Iran both, there are laws on the books that Congress will first have to change and, only then, will the commercial relationship be regularized.

The first step with Cuba is for the two countries to open embassies and appoint ambassadors. On July 19, 2015, full diplomatic relations were restored between the two countries. Cuba has had a head of mission in D.C. for some time. The U.S. embassy in Havana will be opened at about the same time, but the festivities of flag raising and a formal opening will await the visit of Secretary of State Kerry in about a month. There have been interest sections in both countries, with diplomats stationed at them, but normalized diplomatic relations are in the near future for the Cuba and the U.S. Until ambassadors are appointed by both countries, the chargé d’affaires serve as chiefs of mission. While the relationship continues to thaw, until the relevant sections of the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1995 (Helms-Burton), Trading with the Enemies Act, Cuba Democracy Act of 1992, and the Trade Sanctions and Export Enhancement Act of 2000 are amended by Congress, American companies will still not be able to freely conduct business with Cuban companies, and this means they also cannot do so through third parties or non-U.S. related entities. The state of the U.S. regulations can be found at 31 C.F.R. Part 515 (Office of Foreign Assets Control or OFAC) and 15 C.F.R. Parts 730 through 774 (Bureau of Industry and Security). For now at least, those hoping to travel to Cuba will still need to fall into one of the recognized travel categories, click here for more details.

With Iran, the situation is even less predictable. The Joint Comprehensive Plan of Action (JCPOA) was entered into last week between Iran, China, France, Germany, Russia, the U.K., the U.S. and the High Representative for Foreign Affairs and Security Policy for the European Union. The first step is this plan must be approved by the U.N. Security Council and that, too, occurred on July 19th. The reaction of the U.S. can be found here. The key excerpts include:

found here

OFAC website


Practice Areas

Back to Page