Business Aviation Operations to and from Cuba (Part 2) – U.S. Sanctioned Countries Series

> | October 11, 2012 | 2 Comments
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Business Aviation Operations to and from Cuba (Part 2) - U.S. Sanctioned Countries Series

This business aviation blog post is part of a series on operating to U.S. sanctioned countries. Before reading this article, please read Business Aviation Operations to and from Cuba (Part 1).

Before operating flights to Cuba, operators of U.S.-registered aircraft must obtain licenses and ensure that all travelers have an Office of Foreign Assets Control (OFAC) specific or general license. For this reason, it is recommended that the process be started as early as possible before the trip is scheduled to take place. Operators should consult with their 3rd-party providers for the latest information and should supply as much information about the prospective trip as possible, so the appropriate licenses can be obtained from the Bureau of Industry and Security (BIS) and OFAC.

1. What are considerations when applying for licenses covering individuals?

All U.S. nationals and green card holders must have OFAC licenses to travel to Cuba. Certain categories of travelers may be eligible for a “general license”, such as those that cover bona fide journalists, members of religious organizations and sales agents who are employees of companies that can sell authorized products to Cuba, such as medicine, medical devices and agricultural commodities. Otherwise, the travelers will have to apply to OFAC for a specific Cuba travel license. Specific license applications submitted to OFAC for authorized categories of travelers require submission of detailed information on the scope and reason for travel, including a detailed itinerary showing a full time schedule of meetings or other authorized activities. No tourism or significant downtime is authorized for OFAC permitted travel licenses.

2. What documents must be submitted to obtain licenses?

Applications for a BIS temporary sojourn license must be submitted to BIS using the agency’s SNAP-R electronic licensing system. Applications to OFAC for travel licenses can be prepared using OFAC’s online licensing system, which still requires the application to be submitted to OFAC via hard copy or in a letter format. The more information that can be supplied to BIS and OFAC regarding the purpose of the trip, crew and passenger information, the better. Licenses typically set forth a specified number of trips during the validity period of the license. They also contain reporting requirements. The number of trips that will be authorized will depend on the type and purpose of operations.

3. How can your 3rd-party provider assist with a “licensed” flight?

A U.S.-based 3rd-party provider that is an OFAC-licensed Cuba travel service provider (TSP) can support licensed trips of U.S.-registered aircraft to Cuba with flight planning, jet fuel, ground handling, hotels and local transportation services. However, there are still significant limitations on how much U.S.-based 3rd-party providers can do for non-U.S. registered aircraft involving Cuba, unless the flight involves a diplomatic flight to or from Cuba that has been authorized by the U.S. State Department and Federal Aviation Administration (FAA).

4. Any other general tips when operating to sanctioned countries?

When planning a trip to Cuba or other sanctioned countries, always have a “Plan B” in place. For example, if the travelers receive their OFAC license, but not the BIS license for the aircraft, the travelers may need to consider flying on a commercial charter flight from Miami Intl (KMIA) rather than taking your aircraft. Also, be aware that every vendor in the U.S. doing international business with any country, including sanctioned countries, should pre-screen international clients against the various U.S. “restricted party” lists, including OFAC’s specially designated national list. Such restrictions are targeted towards specific entities and individuals that have been sanctioned for illegal acts such as export violations, international acts of terrorism, narcotics and weapons trafficking or money laundering. Significant civil penalties, which can be as high as $250,000 per violation, can be imposed on persons and companies that engage in transactions with prohibited parties. Your 3rd-party provider can help with this screening, and some have the ability to screen against numerous U.S. and non-U.S. “restricted party” lists in one search, although the operator is ultimately responsible for any violations.

11/08/12: Updated by author

Conclusion

Flight operations involving Cuba or other sanctioned countries are complicated and take extensive planning. Because licenses and other required authorizations take time, do not expect your 3rd-party provider to be able to obtain licenses within a matter of days before the trip. Because of the significant restrictions on Cuba, which include restrictions on travel, a trip to Cuba can involve months of pre-trip planning for U.S. citizens and U.S.-registered aircraft. The process of taking a U.S.-registered aircraft to Cuba, however, will go much more smoothly with as much advance planning as possible and the assistance of an experienced 3rd-party provider.

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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