By William Mauldin And Jack Nicas
WASHINGTON--Americans will be able to travel more freely to Cuba
starting Friday and U.S. companies will see looser restrictions,
according to new rules released Thursday by the Obama
administration.
While pure tourism will still be banned and much of the
decades-old embargo on trade remains intact, officials and
businesses said the policy changes will boost ties between Cubans
and Americans in one of the biggest policy shifts in 50 years.
The new move sets up a battle between entrenched foes of the
Castro regime in Havana, including many U.S. lawmakers, and the
increasing number of Americans who want to travel and do business
in Cuba.
Declaring the decades-old isolation policy a failure, President
Barack Obama last month moved to renew ties with Havana with an
exchange of prisoners and a plan to relax some rules on business
and travel.
"The regulations will dramatically expand the ability for
Americans to visit Cuba and will begin to permit American
businesses to explore the Cuban market," said Jake Colvin, Cuba
expert at the National Foreign Trade Council, which opposes
unilateral sanctions.
The officials who developed the rules at the Treasury Department
and Commerce Department said they sought to emphasize ties that
would link ordinary Cubans and Americans rather than enrich the
Cuban state, which directly controls much of the economy. The goal
appears to be giving Cubans a taste of finance and travel ties to
encourage the government to open up the economy further.
Still, critics of Mr. Obama's plan in both parties vowed to
fight what they see as an attempt to undermine Congress and a web
of U.S. laws limiting commerce across the Straits of Florida.
Sen. Marco Rubio (R, Fla.), a Cuban-American opposed to the
easing of ties, called the new rules "a windfall for the Castro
regime that will be used to fund its repression against Cubans, as
well as its activities against U.S. national interests in Latin
America and beyond."
Among the rule changes:
--Twelve categories of Americans, ranging from family members of
Cubans to professionals attending meetings, will be able to visit
Cuba without seeking permission from the U.S. government, and U.S.
citizens will be allowed to bring back $400 in goods from Cuba,
including $100 in alcohol and tobacco, such as Cuba's famous rum
and cigars.
--U.S. firms will be allowed to work on telecommunications
infrastructure in the country and export devices ranging from
mobile phones to consumer software without a license.
--The U.S. agribusinesses that already ship hundreds of millions
of dollars of farm products to Cuba a year will gain more flexible
payment terms, helping them compete better with Brazilian and other
food producers.
--U.S. banks will be able to open correspondent accounts with
Cuban financial institutions to facilitate business payments and
allow bank card transactions in Cuba. Allowed money transfers to
Cuban citizens will quadruple to $2,000 per quarter, and
remittances to private businesses and humanitarian projects will be
unlimited.
Lawyers following the rules said they adhered closely to the
blueprint the White House laid out in December. But their
publication Friday means businesses and travelers will be able to
move ahead with plans to enter the market or apply for licenses for
other commerce not automatically granted under the new rules.
For most Americans, the biggest change will be that trips to the
island are set to become far easier, likely cheaper--and, in some
ways, similar to traditional tourism.
While U.S. law still forbids tourism to Cuba, the changes
announced Thursday will allow eligible Americans to travel to the
country on the honor system, eliminating a requirement for many to
obtain prior approval.
The Treasury Department also said that starting Friday, it will
no longer require licenses for airlines or travel agents to provide
travel to Cuba. Since the Obama administration loosened
restrictions on travel to Cuba several years ago, U.S. airlines
have been operating dozens of weekly charter flights to the island,
carrying relatives of Cuba residents, humanitarians, journalists
and other authorized travelers.
But those airlines, including American Airlines Group Inc. and
United Continental Holdings Inc., have operated those charters on
behalf of middlemen licensed by the Treasury Department. The
department's new rules will allow airlines to operate charter
flights to Cuba on their own and sell tickets directly to
customers.
For now, however, those flights will remain under the regulatory
distinction of being charter flights. Regularly scheduled
commercial air service--how most people fly in the U.S. and
elsewhere--still requires a series of regulatory steps from other
federal agencies, including the State Department and the
Transportation Department.
It's unclear how those charter flights to Cuba operated directly
by U.S. airlines would differ to average fliers from regularly
scheduled commercial air service.
What is clear is the interest from U.S. airlines to capitalize
on a new exotic tourist destination just 90 miles off the coast of
Florida.
"When rules are loosened in an orderly fashion, we're standing
by and ready and eager to grow," Robert Land, JetBlue Airways
Corp.'s senior vice president of government affairs, said in an
interview before Thursday's changes were announced.
"We're further than we've been since Jack Kennedy was in office
and as an airline looking to provide lift, that's very promising,"
Mr. Land said. "How fast that spigot opening goes to a full flow,
there are so many obstacles," including in Cuba and on Capitol
Hill.
In an email following the Treasury Department's announcement
Thursday, Mr. Land said that JetBlue "continues to be eager to grow
our existing charter business within the soon-to-be expanded bounds
of the regulations."
Still, an official on the conference call Thursday said that
Americans who travel to Cuba outside of the new approved categories
"do so at their peril, in violation of U.S. law."
Write to William Mauldin at william.mauldin@wsj.com and Jack
Nicas at jack.nicas@wsj.com
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