On January 11, 2021, the U.S. Department of State (“DOS”) redesignated Cuba on the List of State Sponsors of Terrorism (“SST List”) for “repeatedly providing support for acts of international terrorism in granting safe harbor to terrorists.” DOS based its decision on the continuous support by Cuba of the Maduro regime in Venezuela and on Cuba’s refusal to extradite to Colombia certain leaders of the National Liberation Army (ELN), a U.S. designated Foreign Terrorist Organization. DOS held Cuba accountable for harboring individuals wanted or convicted in the U.S. for violent crimes, including an individual on the Federal Bureau of Investigation’s List of Most Wanted Terrorists.
DOS had previously removed Cuba from the SST List in 2015, in connection with the restoration of diplomatic ties between Cuba and the U.S.
DOS’ designation of Cuba on the SST List has at least two major legal implications. First, it triggers a number of additional economic sanctions against Cuba, including (i) a ban on export licenses for dual-use items, critical technology, and items on the U.S. Munitions Control List; (ii) the prohibition of U.S. assistance to Cuba, including export-import bank credits and guarantees; (iii) the authorization for the U.S. President to further restrict or ban imports of goods and services from Cuba; (iv) the prohibition of financial transactions by U.S. persons with the government of Cuba; (v) the requirement that U.S. representatives at international financial institutions vote against loans or other financial assistance to Cuba; (vi) Cuba’s ineligibility for the Generalized System of Preferences; and (vii) the denial of tax credits for income earned in Cuba.
U.S. and foreign persons violating these economic sanctions on Cuba may face significant civil and criminal penalties. Accordingly, businesses should immediately update their sanctions compliance programs, and carefully review any transaction involving Cuba to confirm whether they can proceed without first obtaining a license from the U.S. Government. The second major legal implication of DOS’ redesignation of Cuba on the SST List is that it triggers an exception to the jurisdictional immunity of that country in the U.S. under the Foreign Sovereign Immunities Act. Consequently, victims of terrorist acts caused or supported by officials, employees, or agents of the Cuban Government may now have a clearer path to seek damages in a court of the U.S.
Diaz Reus International Law Firm & Alliance