Cuba Connection

When President Barack Obama announced last December that the U.S. and Cuba would re-establish diplomatic relations after a half-century of glaring at each other across the Florida straits, some cheered the decision; others condemned it.

In any case, it means embassies and diplomats, trade and commerce, tourism and cigars. Right?

Not so fast, says Peter Quinter, chair of GrayRobinson’s customs and international trade group. He also chairs the Florida Bar Association’s international law section.

“Americans will be able to travel there, just as they do in every other country,” says the Miami attorney. “We’re at the very beginning of a new relationship with Cuba, and we here in Florida will be leaders in developing that relationship.”

But it will take some time.

Quinter was preparing this spring to lead about 20 prominent Sunshine State attorneys to Cuba to meet with lawyers and government officials there. The purpose, he says, is to “promote freedom and democracy in Cuba, and international relations.”

Travel to Cuba is still restricted to 12 categories, which include academic research, journalism, family visits and religious purposes. But travel restrictions have been eased somewhat within those categories, prompting online travel sites to quickly begin advertising flights, ferry rides and day trips to Cuba. Most people should still travel with groups, Quinter advises.

“People who have never been, they should not do this independently,” he says. “The people-to-people tours organize everything for you. That’s what people should do on their first trip.”

A big problem is money. Travelers have to carry cash for hotels, restaurants, car rentals, tour operations and purchases because credit-card processing capability is limited, and no U.S. bank-issued cards had been accepted. However, American Express and MasterCard announced they would begin allowing U.S. credit-card use in Cuba. 

Speaking of money, Cuba will be open to direct investment from the U.S., assuming the embargo is lifted, say C. Ryan Reetz and Pedro Martinez-Fraga, partners at Bryan Cave. Reetz is the managing partner of the Miami office. Martinez-Fraga, whose family escaped Cuba when he was a small child, is co-leader of the firm’s international arbitration team and a leader in the field of international litigation and transnational arbitration.

Individuals won’t be able to buy stocks, but large institutional investors—investment houses and firms that manage mutual funds and 401(k)s and the like—could see Cuba as more of a financial opportunity.

“As Cuba becomes more and more opened up to investment from the U.S., people will find themselves, understandably, having more interests in Cuba,” says Reetz. “There are many reasons to believe Cuba would welcome investment from U.S. sources.”

In order to build a vigorous hospitality industry and strengthen economic ties to the U.S., Cuba will need a financial infrastructure and trade agreements with the U.S. in place. However, U.S. companies that operate everything from hotels to highway toll booths will want to be sure their investments won’t be appropriated by the state, as happened after Fidel Castro came to power in 1959. 

Martinez-Fraga says Cuba has had a good track record with foreign investment over the past decade. “The rest of the world already invests in Cuba,” he notes. 

Many Americans just want to know if they can order cigars—or a case of rum—from home. Not yet, Quinter says, though one day that may be possible. 

However, U.S. visitors to Cuba are allowed to come home with $400 worth of items, including $100 worth of liquor and cigars. Quinter plans to come back with his share.