Sunday, December 20, 2015

Fins - U.S. businesses keep wary eye on improving relations with Cuba

Fins: U.S. businesses keep wary eye on improving relations with Cuba
2:25 p.m. Thursday, Dec. 17, 2015 | Filed in: Business

It was a year ago that the U.S. and Cuban governments announced their
Cold War thaw — and we've seen many signs of rapprochement since.

Embassies have reopened, and airlines and cruise lines have plans to
start service to the island. It seems everyone is making travel plans to
explore the erstwhile forbidden island, if they haven't been there
already, including President Barack Obama.

So, finally, the Cold War with Cuba is over, right? No, not by a long shot.

"No question the hardest work is still ahead," said Adolfo Garcia, an
attorney and part-time West Palm Beach resident who represents people
wanting to do business in Cuba. "The hardest question is the money."

More specifically, the close to $10 billion in assets expropriated
without compensation by the Castros and legal judgments that, over
decades, have been levied against the Cuban government in U.S. courts.

Yes, the door has opened for tourism and some trade, but that's the
low-hanging fruit. It's direct investment in a country that creates
stability, prosperity and economic staying power.

In August, I wrote about how Cuba's totalitarian and communist rules
basically rule out free enterprise. But Garcia, a Cuban-born and
U.S.-raised attorney who works for a Boston law firm, Brown Rudnick,
said major hurdles also remain on the U.S. side.

The Helms-Burton law that codified the embargo, Garcia said, still
scares away executives and businesses. Companies may be interested in
Cuba, but the law is the law, and no one wants to break it.

"What I hear, and this is unanimous from all sides, is the biggest
problem is U.S. law," said Garcia, who is a proponent of the Obama
administration's approach to Cuba.

Then there are the legal judgments. These include long-standing claims
by U.S. citizens and businesses for compensation for their expropriated
properties, plus more recent judgments by American citizens and
residents — such as the families of the Brothers to the Rescue pilots
brutally killed by Cuban fighter jets — who sued the Cuban government in
U.S. courts.

Garcia said people on the Cuban side worry about "attachments" — a sort
of lien against a U.S.-Cuba business to settle existing claims. It's
akin to garnishing wages.

The claims are challenged by the Cuban government, which has said it is
owed $1 trillion from the U.S. for damages incurred under the embargo.

"That's a very tough argument," said Garcia. "And it's going to be very
hard to change U.S. law until these complicated and difficult issues are

And there is a U.S. presidential election next year, which means a new
president could put the brakes on all of this in 2017. Still, Garcia
said the opening toward Cuba announced a year ago is still very much
worth the effort.

"After 50-plus years, it was time to do something different," he said.
"Just remember, the goal is not immediate change in Cuba, but to create
conditions for change."

A correction from last week: Just wanted to set the record straight on
the name of Oasis Outsouring.

Source: Embargo, legal claims stand in way of normalized US-Cuba
business | -

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