On January 14, 2025, President Biden took action towards rescinding Cuba’s designation as a State Sponsor of Terrorism (“SST”) and to remove restrictions on financial transactions with certain Cuban parties by issuing to Congress a Certification of Rescission of Cuba’s Designation as a State Sponsor of Terrorism (“Certification”) and National Security Memorandum 29 (“NSM-29”) revoking a past National Security Presidential Memorandum related to Cuba that had been issued by then-President Trump in June 2017. President Biden also sent a Letter to the Chairmen and Chair of Certain Congressional Committees on the Suspension of the Right to Bring an Action Under Title III of the Cuban Liberty and Democtratic Solidarity (LIBERTAD) Act of 1996 (also known as the Helms-Burton Act) (“Title III Letter”) suspending for six months beyond January 29, 2025 the right to bring an action under Title III of the Act for “trafficking” in confiscated property claimed by US nationals.
These actions were taken in the context of an agreement between the Vatican and the Cuban government for the release of certain political prisoners. However, shortly after being inaugurated as the 47th President of the United States on January 20, 2025, Donald Trump rescinded both the Certification and NSM-29, effectively reinstating the status quo. That said, it does not appear that President Trump has rescinded the Title III Letter yet, but we would expect him to lift or not extend the six-month suspension of the right to bring an action under Title III as he was the first president to not continue suspension of the provision since its enactment in 1996, having allowed it to proceed for the first time in April 2019. Notably, the suspension does not affect pending suits brought before the suspension took effect.
Biden Rescission and Trump Reinstatement of Cuba’s State Sponsor of Terrorism Designation
This is the second time that President Trump has reversed his predecessor’s rescission of Cuba’s designation as an SST. Cuba was originally designated as an SST in 1982, but President Barack Obama rescinded that in May 2015. Then, on January 11, 2021, in the final days of the first Trump administration, the US State Department announced Cuba’s redesignation as an SST for allegedly supporting acts of international terrorism and granting safe harbor to terrorists.
As explained in our prior blog post on Cuba’s 2021 designation as an SST, the sanctions and export controls implications of the redesignation are limited because Cuba is already subject to comprehensive sanctions and strict export controls. For example, the Biden administration never reversed the first Trump administration’s imposition of a 10% de minimis threshold on Cuba in October 2019. That said, we recap the sanctions and restrictions triggered by Cuba’s SST status here:
- A licensing requirement for exports or reexports of goods or technology that could significantly enhance Cuba’s military capability or ability to support terrorism;
- A prohibition on exports and reexports to Cuba of defense articles and defense services and related technology under the International Traffic in Arms Regulations;
- A requirement for the United States to oppose loans to Cuba by the World Bank and other international financial institutions;
- A prohibition on any assistance to Cuba under the Food for Peace, Peace Corps, and Export-Import Bank programs;
- A prohibition on US Persons (i.e., entities organized under US laws and their non-US branches; individuals and entities physically located in the United States; and US citizens and permanent resident aliens, wherever located or employed) from engaging in financial transactions with the Cuban government without a license from the US Department of the Treasury’s Office of Foreign Assets Control, under the Terrorism List Governments Sanctions Regulations; and
- An exception to sovereign immunity that allows individual US Persons to bring claims against the Cuban government in US courts for personal injury and death resulting from terrorism or material support for terrorism.
Biden Revocation and Trump Reinstatement of NSPM-5 and the Cuba Restricted List
President Trump also rescinded former President Biden’s revocation of National Security Presidential Memorandum 5 of June 16, 2017 (“NSPM-5”), which revocation directed the Secretary of State to “immediately rescind” the “List of Restricted Entities and Subentities Associated With Cuba” (also known as the “Cuba Restricted List”). That list was developed pursuant to NSPM-5 and comprises entities determined to be under the control of, or who act for or on behalf of, the Cuban military, intelligence, or security services or personnel and with which direct financial transactions would disproportionately benefit the Cuban military, intelligence, or security services or personnel at the expense of the Cuban people or private enterprise in Cuba. On January 16, 2025, the Secretary of State issued a notice announcing that the rescission had occurred that has since been withdrawn.
At the time of publication, the State Department website has not yet been updated to reflect President Trump’s reinstatement of the Cuba Restricted List, but we anticipate that it will be updated soon.
Persons subject to US jurisdiction are generally prohibited from engaging in certain direct financial dealings with entities and subentities identified by the State Department on the Cuba Restricted List.
Looking Ahead
It remains to be seen whether President Trump will reinstate other aspects of the Cuba sanctions relaxed under President Biden, particularly given the confirmation of Marco Rubio, a strong critic of Cuba, as the new Secretary of State. For example, the May 2024 authorization for so-called “U-turn” transactions (i.e., funds transfers in which Cuba or Cuban national have an interest when such transfers originate and terminate outside the United States, provided that neither the originator nor beneficiary is subject to US jurisdiction) which was intended to support remittances with Cuban nationals and other measures could be under scrutiny.