Business Aviation Operations to and from Cuba (Part 1) – U.S. Sanctioned Countries Series

> | October 4, 2012 | 2 Comments
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This business aviation blog post is the first in a series on operating to U.S. sanctioned countries.

Because of the long-standing U.S. sanctions and significant restrictions on travel to and from Cuba, only a small number of flights between the U.S. and Cuba occur each day, and most of these are charter (non-scheduled commercial) flights. As a result, planning for and operating authorized business aviation flights involving U.S.-registered aircraft and U.S. travelers can be time-consuming and challenging. As a result, it is critical for business aviation operators to have a clear understanding of what types of operations are permitted and to work with an experienced 3rd-party provider to assist with authorized flights and trips.

1. How does Cuba place in terms of U.S. sanctioned countries?

Of the countries subject to comprehensive U.S. sanctions, which currently includes Cuba, Iran, Myanmar (Burma), North Korea, The Republic of Sudan (Northern Sudan), and Syria, the U.S. sanctions on Cuba are the most significant in scope. Not only are virtually all trade-related transactions with Cuba prohibited, the U.S. also restricts most travel-related transactions with Cuba. While there are certain categories of travel with Cuba that are permitted by a specific or general license, most business travel to/from Cuba remains prohibited by the Cuban Assets Control Regulation, which is administered by the Treasury Department’s Office of Foreign Assets Control (OFAC).

2. What are the different types of sanctions the U.S. imposes on various countries?

U.S. sanctions can range from targeted financial sanctions aimed at certain individuals in a country, to restrictions on certain types of investment in a country, to comprehensive economic sanctions, which prohibit virtually all trade and financial sanctions involving a target country. In addition to trade and financial sanctions, the U.S. can also impose restrictions on the export and re-export of U.S. origin goods and technology, including civil aircraft, to sanctioned countries via the export control laws and regulations.

3. Does the status of sanctions change?

U.S. sanctions are based on multilateral and unilateral foreign policy and national- security issues. As a result, they can and do change frequently as world events dictate. For example, over the past few years, we have seen sanctions on Libya lifted, re-imposed, and then lifted again. We have also seen sanctions come and go on Iraq and the Balkans countries. By contrast, the U.S. sanctions on Cuba have been in place since the early 1960s and have not changed significantly in 50 years. As a result of the ever- changing scope and breath of sanctions, it is important for owners and operators of business aircraft to stay abreast of changes to U.S. sanctions and export controls on the countries where they may conduct flight operations or overflights. While an experienced 3rd-party service provider can give its business aviation customers sanctions guidance, it is recommended that pilots and corporate aviation staff check the websites of OFAC and the Commerce Department’s Bureau of Industry and Security (BIS), or consult with an export controls and sanctions attorney, for the most up- to-date information.

4. How do Cuba sanctions impact operation of business aircraft?

U.S. sanctions on Cuba can impact business aircraft operations in a variety of ways. For example, flights between certain points in the U.S. and destinations in Central or South America may need to overfly Cuban airspace. In such a case, the 3rd-party provider that obtains the overflight permit will need a license from OFAC in order to obtain the overflight authority from the Cuban Government. In addition, two separate licenses are required even to operate a business aviation flight involving a U.S.-registered aircraft between the U.S. and Cuba. First, the operator will need what is known as a Temporary Sojourn export license from BIS for the aircraft to be exported from the U.S. on a temporary basis. This license will also cover any onboard technology, such as navigation equipment, communication equipment, etc., and will only be issued if the aircraft will be traveling to Cuba for an authorized purpose. Additionally, each person that will travel onboard the aircraft must be authorized by OFAC through either a specific or general license. As noted above, only certain categories of travel are even eligible for travel to Cuba. Both licenses should be applied for in parallel and it may take many weeks or months to obtain these licenses from OFAC and BIS. Your 3rd-party provider can assist you with the license application process, but there is no guarantee that the license will be issued, since they are granted on a case-by-case basis.

5. Do regulations affect private non-revenue and charter (non-schedule commercial) similarly?

Yes. There are no distinctions in terms of licenses and operating restrictions between private non-revenue and charter operations, since all U.S.-registered aircraft involving flights to and from Cuba must have in place a Temporary Sojourn license issued by BIS. However, it is also important to consider any restrictions that may be imposed by the operator’s insurance coverage, lease agreement, or flight department operational specifications, as these considerations may prohibit you from operating your aircraft to a sanctioned country. It is also important for operators to have contingency plans in place when traveling to Cuba. If you have a mechanical problem on the ground, it may be very difficult to obtain parts and service support for your aircraft.

6. What restrictions are imposed with a Temporary Sojourn license?

Temporary Sojourn licenses issued by BIS include a number of terms and conditions, including that equipment controlled for national security purposes not be available to Cuban nationals while on the ground in Cuba. In addition to the BIS restrictions, other U.S. Government agencies administer regulations that impact the aircraft’s temporary sojourns to Cuba. For example, U.S. Customs and Border Protection (CBP) maintains certain requirements for aircraft departing for and arriving from Cuba, and the passengers and crew will likely be subject to CBP scrutiny prior to departure and upon return from Cuba. CBP regulations also require the aircraft commander to present to CBP the BIS Temporary Sojourn license. In addition, because U.S.-registered aircraft are not permitted to spend significant time on the ground in Cuba, after dropping the passengers off in Cuba the crew and the aircraft must depart Cuba and reposition to a destination outside Cuba before it returns. While flight crewmembers are not permitted to leave the aircraft in Cuba, they do not require OFAC licenses, visas or customs processing in Cuba. CBP also imposes restrictions on which U.S. airports can be used for direct flights between Cuba and the U.S. Finally, the FAA also imposes restrictions and requirements on flight operations between the U.S. and Cuba.

7. From what airports may an aircraft depart the U.S. to Cuba?

Until Sept 26, 2011, all aircraft departing U.S. for Cuba were restricted to Miami (KMIA), New York (KJFK), or Los Angeles (KLAX). There are currently 19 U.S. airports available for direct departures to Cuba (KATL, KAUS, KBWI, KORD, KDFW, KFLL, KIAH, KJFK, KLAX, KEYW, KMIA, KMSY, KOAK, KMCO, KPBI, KPIT, TJSJ, KRSW, and KTPA). Aircraft must operate 0800-2200 local without special permission from both OFAC’s Miami office and from CBP at the appropriate airport.

Next week, in part 2 of this article, we’ll discuss applying for licenses and other tips for operating to Cuba from the U.S.

Questions?

If you have any questions about this article, contact me at bobbybutler@univ-wea.com.

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About

Bobby D. Butler, Jr. is Senior Vice President, Global Partnership Management. Previously he served as Vice President, Chief Compliance Officer and Director of Internal Audit of Universal. Bobby has extensive experience with compliance and international business issues and is a regular speaker on subjects such as the Foreign Corrupt Practices Act (“FCPA”), global anti-bribery, export controls, economic sanctions, anti-boycott, anti-trust and the like. Bobby is the former Chairman of the Board of International Compliance Professionals Association (ICPA) and a member of the Houston District Export Council. In addition, he holds membership positions with the Ethics and Compliance Officers Association, the Society of Corporate Compliance and Ethics, the Greater Houston Business Ethics Roundtable and the American Bar Association. He is adjunct faculty with the University of Houston and Houston Community College. In addition, he serves on the advisory boards for University of Houston’s Supply Chain and Logistics Technology Degree Program and Houston Community College’s Business Curriculum and Export Academy. Bobby is a certified Compliance and Ethics Professional and holds a Masters in Business Administration – International Business with honors from Our Lady of the Lake University, San Antonio, Texas. In addition, he holds a BA in Political Science from Loyola University, New Orleans, LA and completed a fellowship from Loyola’s Institute of Politics. Bobby can be reached at bobbybutler@univ-wea.com.

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