Exports to Cuba

[Federal Register Volume 64, Number 92 (Thursday, May 13, 1999)]
[Rules and Regulations]
[Pages 25807-25808]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-12132]


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DEPARTMENT OF COMMERCE

Bureau of Export Administration

15 CFR Part 746

[Docket No. 990427108-9108-01]
RIN 0694-AB93


Exports to Cuba

AGENCY: Bureau of Export Administration, Commerce.

ACTION: Final rule.

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SUMMARY: The Department of Commerce, Bureau of Export Administration is 
amending the Export Administration Regulations to implement a part of 
the January 5, 1999, Presidential initiative to enhance the United 
States' support of the Cuban people to promote a transition to 
democracy. This final rule authorizes the issuance of licenses for 
exports of food and certain agricultural commodities sold to 
individuals and independent non-governmental entities in Cuba. This 
rule will increase the number of license applications submitted to the 
Department of Commerce for exports to Cuba.

DATES: This rule is effective May 10, 1999.

FOR FURTHER INFORMATION CONTACT: James Lewis, Director, Office of 
Strategic Trade and Foreign Policy, Bureau of Export Administration, 
Telephone: (202) 482-0092.

SUPPLEMENTARY INFORMATION:

Background

    On January 5, 1999, the President announced that the United States 
will initiate certain actions to enhance support of the Cuban people to 
promote transition to democracy. In doing this, the U.S. seeks to 
assist and support the Cuban people without strengthening the current 
Cuban government. The objective is to promote the development and 
evolution of an independent civil society to help promote a transition 
to a free, independent, and prosperous nation.
    These measures are consistent with the Cuban Democracy Act of 1992, 
as amended, and the Cuban Liberty and Democratic Solidarity (LIBERTAD) 
Act of 1996. The President is authorized to furnish assistance and 
provide other support for individuals and independent non-governmental 
organizations in Cuba.
    Under the President's initiative, the Department of Commerce, 
Bureau of Export Administration (BXA) may approve, on a case-by-case 
basis, applications for exports of food (both solids and liquids) and 
certain agricultural commodities for sale to independent non-
governmental entities (i.e., individuals and other entities that are 
not controlled, owned or operated by the Cuban government) in Cuba. For 
purposes of the new initiative, ``independent non-governmental 
entities'' is defined to include religious groups, private farmers, and 
private sector undertakings such as family restaurants. When submitting 
applications, applicants must demonstrate on the license application 
that the prospective end-user or class of end-users is independent from 
the Cuban government. Include such information in Block 24, Additional 
Information, on Form BXA-748P. The U.S. Government will review this 
information within 30 days. Agricultural commodities that may be 
authorized for sale under the new policy include, but are not limited 
to, insecticides, pesticides, herbicides, seeds and fertilizer. 
Agricultural equipment is not eligible for consideration under this 
policy.
    Consistent with existing practice, the Department of Treasury, 
Office of Foreign Assets Control (OFAC) will generally authorize 
financial transactions (e.g., purchase price, shipping and handling 
charges) related to export sales of food or agricultural commodities 
specifically authorized by BXA. Therefore, an export sale of food 
authorized by Commerce will not require additional specific 
authorization from OFAC for shipping, obtaining payments or other 
financial transactions. Licenses may be authorized to pay for local 
warehousing and transportation services provided that charges and fees 
levied for delivery are customary and reasonable.
    Exporters are advised to indicate on their license applications for 
the export of food and agricultural commodities whether they plan to 
deliver such commodities to Cuba by vessel or aircraft. An export 
license must be obtained from BXA for vessels to transport licensed 
commodities to Cuba. Authorization for the vessel and for necessary 
ship stores may be requested at the time of application for the export 
of food or agricultural commodities for sale in Cuba under the new 
policy. However, note that authorization must be obtained from OFAC for 
the return of such vessels to the United States within 180 days of 
leaving Cuba. OFAC is publishing elsewhere in this issue of the Federal 
Register a separate regulation that allows the return of such vessels 
under a General License, provided that all items have been authorized 
via applicable Federal regulations. Aircraft flying to Cuba to deliver 
commodities licensed under this policy must be eligible for License 
Exception AVS (see Sec. 740.15 of the EAR) or must be specifically 
licensed by BXA.
    The President also called for expansion of people-to-people 
contacts between the United States and Cuba by facilitating travel of 
persons from the United States to Cuba and from Cuba to the United 
States, and streamlining licensing procedures for authorizing such 
travel. Pursuant to the President's initiative, BXA will also review, 
on a case-by-case basis, license applications requesting authorization 
to use private aircraft for temporary sojourn for travel to Cuba 
involving educational, cultural, journalistic, religious, or athletic 
exchanges and other people-to-people contacts. This policy furthers the 
President's March 1998 initiative, under which BXA is already 
reviewing, with a presumption of approval, applications for temporary 
exports of private aircraft involving humanitarian aid and assistance 
programs. This policy is applicable to temporary sojourn flights from 
the U.S. to Cuba of aircraft not eligible for BXA License Exception AVS 
(see Sec. 740.15 of the EAR), and that require specific authorization 
from BXA. Note that aircraft may fly on regularly scheduled charter 
flights to Cuba generally under License Exception AVS. OFAC must 
authorize travel by U.S. persons associated with such flights. Any 
commodities included on the aircraft that do not qualify for License 
Exception BAG (see Sec. 740.14 of the EAR) or License Exception TMP 
(see Sec. 740.9 of the EAR) require a specific Commerce license 
authorizing the export of such items to Cuba.
    As another part of this initiative, other agencies will authorize 
direct charter flights to Cuba departing from U.S. cities other than 
Miami by separate notice. The United States is also seeking to 
reestablish direct mail between the United States and Cuba. This 
measure requires the agreement of the Cuban

[[Page 25808]]

government. BXA reminds exporters that the mailing of gift packages 
through U.S. mail still constitutes an export and must meet the 
content, frequency and dollar value requirements of 
Secs. 746.2(a)(1)(viii) and 740.12 of the EAR, or be specifically 
licensed by BXA.
    Although the Export Administration Act (EAA) expired on August 20, 
1994, the President invoked the International Emergency Economic Powers 
Act and continued in effect the EAR, and, to the extent permitted by 
law, the provisions of the EAA in Executive Order 12924 of August 19, 
1994, extended by Presidential notice of August 13, 1998 (63 FR 44121, 
August 17, 1998).

Rulemaking Requirements

    1. This interim rule has been determined to be not significant for 
purposes of E.O. 12866.
    2. Notwithstanding any other provision of law, no person is 
required to, nor shall any person be subject to a penalty for failure 
to comply with a collection of information, subject to the Paperwork 
Reduction Act (PRA), unless that collection of information displays a 
currently valid OMB Control Number. This rule involves a collection of 
information previously approved by the Office of Management and Budget 
under control number 0694-0088, ``Multi-Purpose Application,'' which 
carries a burden hour estimate of 45 minutes per manual submission and 
40 minutes per electronic submission. In addition, miscellaneous and 
recordkeeping activities account for 12 minutes per submission. As a 
result of this rule, the paper work burden on the public is increased 
by 22 hours on an annual basis.
    3. This rule does not contain policies with Federalism implications 
sufficient to warrant preparation of a Federalism assessment under E.O. 
12612.
    4. The provisions of the Administrative Procedure Act (5 U.S.C. 
553) requiring notice of proposed rulemaking, the opportunity for 
public participation, and a delay in effective date, are inapplicable 
because this regulation involves a military and foreign affairs 
function of the United States (Sec. 5 U.S.C. 553(a)(1)). Further, no 
other law requires that a notice of proposed rulemaking and an 
opportunity for public comment be given for this interim final rule. 
Because a notice of proposed rulemaking and an opportunity for public 
comment are not required to be given for this rule under 5 U.S.C. or by 
any other law, the requirements of the Regulatory Flexibility Act (5 
U.S.C. 601 et seq.) are not applicable.

List of Subjects in 15 CFR Part 746

    Exports, Foreign trade, Reporting and recordkeeping requirements.

    Accordingly, 15 CFR chapter VII, subchapter C, is amended as 
follows:

PART 746--[AMENDED]

    1. The authority citation for 15 CFR part 746 continues to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
22 U.S.C. 287c, 6004; E.O. 12918, 59 FR 28205, 3 CFR, 1994 Comp., p. 
899; E.O. 12924, 3 CFR, 1994 Comp., p. 917; Notice of August 13, 
1997 (62 FR 43629, August 15, 1997); Notice of August 13, 1998 (63 
FR 44121, August 13, 1998).

    2. Section 746.2 is amended by adding a new paragraph (b)(4)(iii) 
to read as follows:


Sec. 746.2  Cuba.

* * * * *
    (b) * * *
    (4) * * *
    (iii) Exports of food (both solids and liquids) and agricultural 
commodities may be approved, on case-by-case basis, for use by 
independent non-government entities in Cuba. Such entities may not be 
controlled, owned or operated by the Cuban government. Applicants must 
demonstrate on the license application in Block 24, Additional 
Information, that the prospective class or classes of end-users are 
independent from the Cuban government.
    (A) Agricultural commodities that will be considered for approval 
include, but are not limited to, insecticides, herbicides, pesticides, 
seeds and fertilizer. Agricultural equipment is not eligible under this 
paragraph (b)(4)(iii) for sale to Cuba.
    (B) For purposes of this paragraph (b), independent non-government 
entities include, but are not limited to, religious groups, private 
farmers, and private sector undertakings such as family restaurants.
* * * * *
    Dated: May 10, 1999.
R. Roger Majak,
Assistant Secretary for Export Administration.
[FR Doc. 99-12132 Filed 5-10-99; 3:39 pm]
BILLING CODE 3510-33-P