News

U.S. State Department reinstates Cuba Restricted List

19 February 2025

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Key takeaways

U.S. State Department action restores prohibitions on direct financial transactions with numerous Cuban military, intelligence, and security-linked entities.

The U.S. Department of State has formally republished the Cuba Restricted List, restoring prohibitions on direct financial transactions with numerous Cuban military, intelligence, and security-linked entities. This move follows President Trump’s Day-One order reversing the Biden Administration’s decision to rescind the list just days earlier. The reinstated list now also includes Orbit S.A., a Cuban-based remittance-processing company that the U.S. government has determined to be operating for or on behalf of the Cuban military.

Originally established in 2017 under National Security Presidential Memorandum 5 (NSPM-5), the Cuba Restricted List prohibits direct financial transactions with designated entities that the U.S. government has determined to be “under the control of, or act[ing] for or on behalf of, the Cuban military, intelligence, or security services or personnel,” pursuant to the Cuban Assets Control Regulations (CACR), 31 C.F.R. 515.209. These restrictions prohibit any person subject to U.S. jurisdiction from acting either as the originator of a transfer of funds whose ultimate beneficiary is an entity or sub-entity on the Cuba Restricted List, or as the ultimate beneficiary of a transfer of funds whose originator is an entity or sub-entity on the Cuba Restricted List, including transactions by wire transfer, credit card, check, or payment of cash.

On 14 January 2025, the Biden administration sought to ease sanctions on Cuba and facilitate U.S.-Cuban private-sector engagement by issuing National Security Memorandum 29 (NSM-29), which revoked NSPM-5 and rescinded the Cuba Restricted List. As part of this broader policy shift, President Biden also issued a Certification of Rescission of Cuba’s designation as a State Sponsor of Terrorism (SST) on the same day.

Following President Trump’s return to office, his administration immediately reversed these actions. On 20 January 2025, President Trump issued an Executive Order revoking Cuba’s SST rescission and NSM-29, thereby ordering the reinstatement of the Cuba Restricted List. On 31 January 2025, Secretary of State Marco Rubio approved the reinstatement, stating that the State Department’s objective is “to deny resources to the very branches of the Cuban regime that directly oppress and surveil the Cuban people while controlling large swaths of the country’s economy.” The Cuba Restricted List was formally republished in the Federal Register on 6 February 2025.

The State Department’s action reaffirms the Trump Administration’s longstanding policy to limit financial flows to Cuban government-controlled entities. Per 15 C.F.R. 746.2, Note 2 to paragraph (b)(3)(i), the Department of Commerce’s Bureau of Industry and Security will apply a presumption of denial for export and reexport applications involving entities on the Cuba Restricted List. The updated list—which includes Cuban governmental ministries, holding companies, hotels, marinas, and defense-sector enterprises—is publicly available and periodically updated on the State Department’s website.

The sole new addition to the reinstated list is Orbit S.A., a remittance-processing company that the State Department determines as “operating for or on behalf of the Cuban military.” Its designation is expected to further restrict the flow of remittances, a significant source of foreign currency for Cuba.

Authored by Yue-Zhen Li, Beth Peters, Stephen Propst, Deborah Wei, and Andrea Fraser-Reid.

Next steps

Companies should assess their contracts, financial transactions, and supply chains for exposure to restricted Cuban entities and update compliance protocols accordingly. Those engaged in cross-border trade or investment with Cuba should evaluate risks and assess compliance measures.

For further guidance on how these developments may affect your business, please consult with your Hogan Lovells contact.