Educational Opportunities in Cuba

Educational Opportunities in Cuba
Compliance, Legalities +
Preparations for Travel
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This presentation is not intended as legal advice and should be considered general information only. The
answers to legal questions generally hinge upon the specific facts and circumstances of an institution.
Individuals with specific questions should contact their institution’s legal counsel.
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December 3, 2015
2:00 – 3:30 PM ET

Panelist
The opinions expressed during today’s event are not
necessarily those of PaperClip Communications
Luis Manuel Alcalde
Global Business Attorney
Kegler Brown Hill + Ritter
lalcalde@keglerbrown.com

Vinita Bahri-Mehra
Panelist
The opinions expressed during today’s event are not
necessarily those of PaperClip Communications
vmehra@keglerbrown.com

Cuba is subject to
a U.S. Embargo
So how can U.S. academic institutions, faculty, staff +
students legally and safely take advantage of available
educational opportunities involving Cuba?

Progress in U.S.-
Cuba RelationsExchanged prisoners
Relaxed/expanded U.S.
authorized travel categories
to Cuba
Expanded list of U.S.
authorized exports to Cuba
and Cuban nationals
Expanded list of Cuban
origin exports to U.S.
Removed Cuba from the
U.S. list of state sponsors
of terrorism
Corresponding banking
relationship established
Diplomatic relations
established + embassies
opened

Despite all the Progress…
U.S.-Cuba relations are not normal
U.S. maintains embargo on Cuba
U.S. companies cannot invest in Cuba or sell goods
to Cuba except for agricultural products, some
communications equipment or direct business to small
private sector (which Cuba has not yet allowed)
U.S. persons cannot freely travel to Cuba
outside of designated licensed categories
As some progress is made the complexities
of the embargo become more evident

What is the
Cuban Embargo?
U.S. policy to isolate Cuba which commenced
in the early 1960s
Comprehensive economic sanctions that include an
embargo on travel, trade and financial transactions
Legal underpinning of the embargo is executive orders
+ series of laws and regulations

Legislative/Regulatory
Basis of Cuban Embargo

Legislative/Regulatory
Basis of Cuban Embargo
Trading with the Enemy Act (1917)
Allows President to restrict trade
with countries hostile to U.S.
in time of war
Foreign Assistance Act of 1961
Allows President to deny assistance to
Cuba and impose trade embargo.
U.S. Treasury Cuban Import Regulations
and subsequent Cuban Asset Control
Regulations (“CACR”) prohibit imports from
and exports to Cuba and restrict travel to
and financial transactions with Cuba
Department of Commerce
Regulations
prohibit or restrict exports to Cuba
Cuban Democracy Act of 1992
Prohibits U.S. subsidiaries from trading with
Cuba and entry of vessels that have been to
Cuba for trade to come to U.S. for 6 mos.
Cuban Liberty and Democratic Solidarity
Act of 1996 (Helms-Burton) – codified
embargo and CACR Regs., but President
retains broad power to modify CACR.
Prohibits President from eliminating
embargo until specified conditions are met.

Principal Agencies
Enforcing Embargo

U.S. Department of the Treasury, Office
of Foreign Assets Controls (“OFAC”)
issues and enforces the Cuban
Assets Control Regulations (“CACR”) –
authorized travel, activities and
financial transactions
U.S. Department of
Commerce, Bureau of
Industry and Security (“BIS”)
authorized exports to Cuba

CACR +
Licenses
What is a License?

CACR +
Licenses
What is a License?
The term license shall
mean any license or
authorization
contained in or issued
pursuant to this part –
31 CFR 515.316

A general license is
any license or
authorization the
terms of which are set
forth in this part – 31
CFR 515.317

General licenses are
described in the
regulations. This means
that the travel, activity
and/or transaction is
authorized as described
without any need to seek
further permission

A specific license is
any license or
authorization issued
pursuant to this part
but not set forth in this
part 31 CFR 515.318

Travel/activities/transactions
not generally licensed
require application and
issuance of a specific
license granting permission
and describing what is
authorized

General License for
Accredited Degree Granting
Academic Institutions
accredited U.S.
graduate and
undergraduate
degree-granting
academic
institutions
including faculty,
staff + students
of such
institutions
available to:

1
Participating in a structured educational
program in Cuba that is part of a course offered
for credit by the U.S. institution;
2
Engaging in non-commercial academic
research in Cuba specifically related to Cuba for
purpose of obtaining undergraduate or
graduate degree from a U.S. institution
(Note: Prior to January 2015, only applied to graduate students)
Educational Activities
Subject to General License

3
Participation in formal course of study at a Cuban
academic institution provided U.S. institution will
accept formal course of study for credit towards
student’s graduate or undergraduate degree
4
Teaching at Cuban academic institution for any
length of time, academic program related to Cuban
institution provided teacher is regularly employed
by a U.S. or non-Cuban academic institution
(Note: Prior to January 2015, teaching engagement had to be at least 10 weeks)

5
Sponsoring (including paying stipend/salary) to
Cuban scholar to teach or engage in other scholarly
activity at U.S. academic institution
Such earnings may be remitted to Cuba as provided in §515.570 or carried on
the person of Cuban scholar returning to Cuba as provided in §515.560(d)(3)
6
Cuban or U.S. sponsored secondary school
academic exchanges for secondary school students
participating in structured study or program led by
teacher or other official + adult chaperones

7
Sponsorships of non-commercial academic
seminars, conference + attendance at such events
by faculty, staff, and students of a participating U.S.
academic institution and workshops in Cuba related
to Cuba or global issues involving Cuba
8
Establishment of academic exchanges and joint
non-commercial academic research projects with
universities or academic institutions in Cuba

9
Providing standardized testing services, including
professional certificate examinations, university
entrance examinations, and language examinations,
and related preparatory services for such exams to
Cuban nationals, wherever located
10
Providing internet based courses, including
distance learning and Massive Open Online
Courses (“MOOC”), to Cuban Nationals, wherever
located, provided course content is at
undergraduate level or below

11
Organization of, and preparation for, activities
described in paragraphs (a)(1) through (10) of this
section by employees or contractors of the
sponsoring organization that is a person subject to
U.S. jurisdiction
12
Facilitation by an organization that is a person
subject to U.S. jurisdiction, or a member of the staff
of such an organization, of licensed educational
activities in Cuba on behalf of U.S. academic
institutions or secondary schools, provided that:
Organization is directly affiliated
with one or more U.S. academic
institutions or secondary schools
Organization facilitates educational
activities that meet requirements of 1 or
more of the general licenses set forth in
§515.565(a)(1), (2), (3), and (6).

1
Hosting a public performance, clinic, workshop, or
athletic competition; provided the event is open for
attendance and in relevant situations participation
by the Cuban public; and provided further that all
profits after costs are donated to an independent
non-governmental organization in Cuba or a U.S.
based charity. The goal of such events should be to
promote people to people contacts or benefit the
Cuban people, to the extent possible. Any clinics or
workshop in Cuba must be organized and run at
least in part by authorized travelers.
Other Related Activities

General License
Professional Research
 Purpose of the research directly relates to the traveler's
profession, professional background, or area of expertise,
including area of graduate-level full-time study
 Traveler does not engage in recreational travel, tourist
travel, travel in pursuit of a hobby, or research for
personal satisfaction only
 Traveler's schedule of activities does not include free time
or recreation in excess of that consistent with a full-time
schedule of professional research

General License Attendance
at Professional Meetings
 Purpose of the meeting or conference is not promotion of
tourism in Cuba
 Purpose of the meeting directly relates to traveler's profession,
professional background, or area of expertise, including area of
graduate-level full-time study
 Traveler does not engage in recreational travel, tourist travel, or
travel in pursuit of a hobby
 Traveler's schedule of activities doesn’t include free time or
recreation in excess of that consistent with a full-time schedule
of attendance at professional meetings or conferences

 Every person engaging in any transaction subject to the
provisions of this chapter shall keep a full and accurate
record of each such transaction engaged in, regardless
of whether such transaction is effected pursuant to license
or otherwise, and such record shall be available for
examination for at least 5 years after the date of such
transaction.
 Reports under oath may be required at anytime before or
after a transaction including the production of any books
of account, contracts, letters or other papers connected
with any such transaction or property, in the custody or
control of the persons required to make such reports.
Record Keeping – 515.561 + .562

Ease of Other Restrictions
January + September 2015 eased
restrictions regarding:
Opening bank
accounts in Cuba
U.S. academic institutions can
open bank accounts to support
educational activities
authorized under educational
activities general license
Directly travelling
to Cuba from U.S.
2015 regulations no longer
requires U.S. citizens to book
through pre-authorized travel
agencies and travel only on
charter planes
However, as of now, there is still
no scheduled airline service
between U.S. and Cuba, as a
U.S.-Cuban aviation deal must
be reached first

Penalties for Violation of
Cuba Regulations
Can lead to criminal + civil penalties
Criminal
Imprisonment of up to 10 years
and fines of $1,000,000 dollars
for entities and up to $250,000
for individuals
Civil
Fines of up to $65,000 per
violation; Attempts to conceal
violations are separate offenses
that can lead to imprisonment
for up to 5 years + other
consequences

Penalties for Violation of
Cuba Regulations
Can lead to criminal + civil penalties
Criminal
Imprisonment of up to 10 years
and fines of $1,000,000 dollars
for entities and up to $250,000
for individuals
Civil
Fines of up to $65,000 per
violation; Attempts to conceal
violations are separate offenses
that can lead to imprisonment
for up to 5 years + other
consequences
Corporations and entities can face
many other federal government
sanctions such as loss of federal
contracts and grants

Living Expenses + Remittances
 All transactions ordinarily incident to travel within Cuba, including
payment of living expenses and the acquisition in Cuba of goods for
personal consumption there, are authorized. 31 C.F.R. 515.560
(a)(12)(c)(2).
 Subject to some restrictions (i.e. blocked sources) family members
can send remittances to close relatives in Cuba who are students in
Cuba participating in generally licensed activities and funds are used
solely to fund those activities. 31 C.F.R. 515.570(d)
 There are authorized entities to send remittances to Cuba including
Western Union. Payment in Cuba is made in CUCs and the dollar is
subject to a tax of 10% in addition to any exchange rate fluctuations
and fees.

Business Travel To Cuba
 Verify legality of travel
under U.S. law
 Identify what is needed
pursuant to Cuban law
(i.e. business visa, student visa,
event visa, tourist visa)
 OFAC authorized travel
providers are often able to
assist in obtaining visas
from the Cuban Embassy if
all required information is
provided to them
 Business visas required to
travel to Cuba to engage in
formal business meetings +
discussions with Cuban
officials

Cuban Business Visa
Initial request to
Commercial Attaché at
Cuban Embassy in D.C.
who must authorize
Consular Officials
 Valid passport
 One passport-type photo
 Letter of invitation from
Cuban institutions (sponsoring
institution)
 Completed visa application
form
 Payment of consular fees for
this service

Cuba Travel: Crime + Safety
 Ensure Compliance with Institution’s International Travel Policy
 Check State Department Travel Advisories & Current Events
 Most crime involves non-confrontational petit thefts,
pickpocketing, scams involving counterfeit items
 Sex trade is open and obvious in certain tourist areas
 Violent crime is not common
 Illegal drugs severely penalized

Vehicular accidents: a leading
source of injuries
Leave the driving to Cubans!

Cuba Travel: Health Issues
 There are no specific Health Notices for Cuba
 Health concerns focus on contaminated drinking water,
food washed with contaminated water and sexual activity
with strangers
 Travelers to Cuba must purchase health insurance from
Cuba but should have U.S. based insurance
cdc.gov/travel/destinations/traveler/none/cuba

Although there are numerous
hospitals in Havana, Americans
generally use the Cira Garcia
Hospital, which is operated
specifically for foreigners and
provides better quality care,
although still below U.S. standards.
Cira Garcia Hospital
41st Ave + 18th Street, Miramar
(53)7-204-2811
Ambulance Service: (53)7-204-4300

Export Control Issues
 The export and reexport to Cuba of all items subject to the Export
Administration Regulations (EAR) require a BIS license, unless
authorized by a license exception in Section 746.2(a)(1) of the EAR.
 A license exception is an authorization to export or reexport under
stated conditions certain items without a license that would
otherwise require a license.
 So if an item is not described in Section 746.2(a)(1), it cannot be
taken to Cuba without first applying for and being granted a license.
Check with counsel for any item not described therein.

What can be taken
to Cuba traveling
on educational
license?

EAR 740.14 BAG
Personal + household effects
Tools of trade such as computers
+ software owned by person
and for personal use
Must take reasonable security
precautions with technology
EAR 740.14(g)
Use secure connections, passwords,
firewalls, etc.
All items must come back to
U.S. unless consumed/destroyed

Agreements with
Cuban Universities
Macro
Agreement
Collaboration
Agreement
an umbrella or master
agreement to be followed
by specific project
agreements
agreement to collaborate
on specific areas in the
future

Specific Agreements
Visiting
Student
Agreements
Joint
Research
Agreements
Faculty
Exchange
Agreements
Student
Recruitment
Agreements
Educational
Services
Agreement
Testing, Certification Programs,
Preparatory Services

Important Terms +
Conditions
Financing Housing Language
Generally paid 100%
by U.S. party
In country expenses
to be paid by or for
students/faculty;
advised to carry cash
Assistance from host
school in finding
housing or hosting
students
Financial
responsibility for
housing –likely by
host university
Required language
skills to participate
in program
Language governing
the parties
agreement

Important Terms +
Conditions
Calendar Admission Expectations
Dates of program
Milestone for
completion, grades,
etc.
Eligibility criteria to
participate
Criteria for choosing
and permissible
numbers of students
Expected level of
participation by
students/faculty
Applicable academic
and national law
jurisdictions

Important Terms +
Conditions
Intellectual Property Dispute Resolution
Data + Personal
Information Protection
• Ownership of IP
Provided
• Ownership of IP
Developed
• Registration of IP
in Cuba
• Resolving disputes
as to students and
faculty
• Resolving disputes
between schools?
• Mediation will be a
better first step to
resolve disputes
Data + privacy in
Cuba is very different
than U.S., so to the
extent this is an issue,
it should be
considered/addressed
in agreement

Intellectual Property
Protection in Cuba
OCPI (Oficina Cubana Propiedad Industrial)
Cuban Office for Intellectual Property
(Ministry of Science, Technology 7 Environment)
Grants and Registers rights in industrial
property: patents + trademarks
CENDA (Centro Nacional de Derecho de Autor)
Under Ministry of Culture for copyright
legislation, policy +registration

Types of IP Protected
Patents for
inventions
+ industrial
designs
Protectable
plant
varieties
Marks +
slogans
Integrated
circuits
Copyrights

Types of IP Protected
Patents for
inventions
+ industrial
designs
Protectable
plant
varieties
Marks +
slogans
Integrated
circuits
Copyrights
Cuba is signatory to the
major international
agreements for the
protection of intellectual
property

Best
Practices7
Have Cuba-focused (OFAC) compliance policy + procedures
Have a successful training program
Financial and accounting systems: flagging + screening
Third parties: due diligence + contract clauses
Reporting a violation: voluntary disclosure
Monitoring compliance
Most important: mechanism for solving problems abroad
1
2
3
4
5
6
7

Thank You
Vinita Bahri-Mehra
vmehra@keglerbrown.com
Luis Manuel Alcalde
lalcalde@keglerbrown.com

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