852. What did the October 27, 2020 amendment to the Cuban Assets Control Regulations (CACR) do?
On October 27, 2020, OFAC issued an amendment to the CACR, effective November 26, 2020, to remove from the scope of certain remittance-related general authorizations any transactions involving entities or subentities identified on the State Department’s Cuba Restricted List. Specifically, the October 27, 2020 rule amends the following general licenses: (i) 31 CFR § 515.570, relating to remittances from persons subject to U.S. jurisdiction or from blocked accounts; (ii) 31 CFR § 515.572(a)(3), relating to the provision of remittance forwarding services; and (iii) 31 CFR § 515.587, relating to remittances from Cuban nationals to persons subject to U.S. jurisdiction. For more information, see 31 CFR §§ 515.570, 515.572, and 515.587.
Further, the October 27, 2020 rule amends 31 CFR § 515.421 to clarify that a transaction relating to the collection, forwarding, or receipt of remittances involving an entity or subentity identified on the State Department’s Cuba Restricted List is not authorized as an ordinarily incident transaction where the terms of the general or specific license expressly exclude any such transactions (see, e.g., 31 CFR § 515.570(j), 31 CFR § 515.572(a)(3), or 31 CFR § 515.587). For more information, see 31 CFR § 515.421. OFAC also added a clarifying note in 31 CFR § 515.209, consistent with the amended text of 31 CFR § 515.421. As a result of these amendments, effective November 26, 2020, persons subject to U.S. jurisdiction will no longer be authorized to process remittances to or from Cuba through FINCIMEX or any other entity or subentity on the Cuba Restricted List.
Date Released
October 26, 2020
1) The FAQ relays the nature of the amendments, effective as of Nov. 26, 2020, to 515.209, 515.421, 515.570, 515.572 and 515.587 of the CACR. See the FR notice for the text of the amended provisions, which will be reflected in the Research System when they take effect.
The FAQ does not provide meaningful "interpretive guidance," but does flag FINCIMEX as a CRL-listed entity with which dealings are likely to be particularly impacted as a result of the amendments.
Note that remittance-related transactions that involve CRL-listed entities as payment processors fall outside the scope of the prohibition at 515.209 of the CACR because they are not “direct financial transactions” with CRL-listed entities. The amendments to the CACR have the effect of prohibiting remittance-related transactions not through the alteration of the scope of the prohibition at 515.209, but instead through the amendment to 515.421, which removes remittance-related transactions involving CRL-listed entities from the scope of transactions authorized as “ordinarily incident” to certain otherwise-authorized remittance transactions. The text of the provision and commentary below will be amended in the Research System once the amendment takes effect.
2) Note that the press release issued on 10-26-2020 announcing the remittance-related actions specifies that the purpose of the CACR amendments was to restrict the ability of "Cuba’s military-run institutions" from benefitting from certain remittance-related general authorizations in the CACR (not the Cuban government in its entirety).