Cuba's Legal Landscape Quiet Amid Obstacles on Both Sides
The slow volume of legal work owes as much to hurdles put in place by the Cuban government as the Trump administration's policy reversal, but the island's draft constitution could change the trade equation.
August 20, 2018 at 06:00 AM
8 minute read
Three years ago, the phones were ringing off the hook for American attorneys with a working knowledge of doing business in Cuba.
U.S. President Barack Obama and Cuba's President Raul Castro announced the beginning of a process aimed at normalizing relations between the two neighbors, separated by 93 miles of the Florida Straits, in December 2014. By the following summer following a historic visit by Obama, full diplomatic relations had been restored, and embassies were opened in Washington and Havana.
Now both men have left office, and the phones have gone silent.
“Of the inquiries we've had, I've referred a few to Cuban lawyers and told a few that it's not an optimistic environment,” said Harper Meyer founding partner James Meyer in Miami.
Attorneys working in the space pin some of the blame on the Trump administration's policy reversal. In June 2017, Trump announced that he would curtail tourism and other business dealings that could profit Cuba's military-controlled companies.
“Trade is down, travel is down, investment is down,” said Peter Quinter, who chairs the U.S. customs and international trade group at GrayRobinson in Miami. “It's typical of Trump anywhere in the world.”
And Cuba has vanished from the trade conversation, nudged aside by the brewing trade war with China and kerfuffles with the European Union and partners in NAFTA. These trade relationships individually and collectively dwarf the one with Cuba. The U.S. exported just $291 million in goods to the country in 2017, although the tally of $181 million for the first half of 2018 is up almost $30 million from the first half of the last year.
“The amount of trade between Cuba and the U.S. is minuscule,” Quinter said.
Disinterest and stringent U.S. regulations are not the only obstacles to launching and completing deals — on tourism, joint ventures or trade — with Cuba.
Greenberg Traurig's Yosbel Ibarra, co-managing shareholder of the firm's Miami office, tells his clients with interest in doing business with Cuba that, at least on the U.S. side, they can apply to the U.S. Office of Foreign Assets Control and receive a clear answer.
“You can get a license or not get it. There's certainty,” he said. “On the Cuban side, it becomes a lot more complicated.”
Even at the height of the Obama administration's openness to the communist country, there were still complications in getting the Cuban government to sign off on projects, Ibarra explained. And the replacement of Raul Castro by successor Miguel Diaz-Canel as president in April has had little immediate impact. Efforts to gain approval remain slow.
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