Cuba Sanctions – Latest Developments

21st October 2016

The United States has long maintained sanctions against Cuba and which included a ban on vessels calling in US waters for 180 days after having traded to Cuba. It was recently announced that this prohibition has been amended so that a wider range of non-US vessels may now call at Cuba and then proceed directly to the US.

It should be noted however that this amendment does not amount to a complete lifting of the ban. As a helpful Client Alert produced by the Club’s US attorneys Freehill, Hogan & Mahar makes clear, a vessel may proceed to the US after calling in Cuba only if the cargo it carried to Cuba would, had it been subject to the US Export Administration Regulations, be categorised as "EAR99" and therefore not subject to export restrictions.

To determine whether a cargo would be classified as EAR99, Members should firstly determine if the item is designated by an Export Control Classification Number on the US Commerce Control List (“CCL”), which can be found here. Click the link for the “Commerce Control List Index” on the left side of the page.

If a cargo cannot be found on the CCL then it is most likely classified as EAR99 and a vessel is not then subject to the 180 rule. Conversely, if the cargo is on the CCL then whilst there is no prohibition on the vessel carrying and delivering it to Cuba, she will not be able to trade to US waters for 180 days afterwards, as before.

In case of doubt Members should seek guidance from the Managers. It should also be borne in mind that other provisions of US sanctions which remain in force against Cuba may mean that US insurers and reinsurers are unable to pay liabilities which involve Cuba or Cuban entities. Under the Rules the Club is unable to reimburse Members for sums which are unrecoverable from its reinsurers because of sanctions.

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