Today, OFAC issued a Final Rule amended the Cuban Assets Control Regulations (CACR), amended a bunch of existing Frequently Asked Questions (FAQs) and issued a new one.
These changes correspond to the changes to remittances announced earlier by the State Department in its Saturday press release. Basically, they’re cutting out parties on the Cuba Restricted List (CRL) from the authorizations for remittances – just like General Licenses often exclude transactions involving parties on the Specially Designated Nationals (SDN) List.
Here’s the actual wording from the Final Rule:
OFAC is amending the Regulations to remove from the scope of certain remittance- related general authorizations any transactions involving entities or subentities identified on the Cuba Restricted List, as maintained by the State Department and published in the Federal Register. This action is intended to restrict such entities’ and subentities’ access to funds obtained in connection with remittance-related activities, including in their role as intermediaries or in their receipt of fees or commissions from processing remittance transactions. Specifically, OFAC is amending three general licenses in Subpart E of the Regulations to exclude from the scope of such authorizations any transaction involving any entity or subentity identified on the Cuba Restricted List: (i) § 515.570, which relates to remittances from persons subject to U.S. jurisdiction or from blocked accounts; (ii) § 515.572(a)(3), which relates to the provision of remittance forwarding services; and (iii) § 515.587, which relates to remittances from Cuban nationals to persons subject to U.S. jurisdiction. OFAC is also amending § 515.421, which provides interpretative guidance with respect to transactions ordinarily incident to a licensed transaction, to make clear that a transaction relating to the collection, forwarding, or receipt of remittances involving any entity or subentity identified on the 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. Because the amendments to §§ 515.570, 515.572(a)(3), and 515.587 expressly exclude these remittance-related transactions involving any entity or subentity on the Cuba Restricted List, upon the effective date of this rule, such transactions will not be authorized as ordinarily incident to licensed transactions under those provisions. OFAC is also adding a clarifying note in § 515.209 consistent with the amended § 515.421.
Here is the new FAQ:
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.
Not for nothing – and I’m not trying to be snarky here – but why isn’t OFAC part of the State Department? It’s implementing aspects of U.S. foreign policy – I would think that would trump that its purview includes financial assets.
Links:
Amended FAQs – 72, 717, 728, 732, 733, 734, 756, 759, 796, 797