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Open Cuba talks have U.S. yachts and crew poised to set sail

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News in mid January that U.S. travel restrictions to Cuba will be eased sent a wave of enthusiasm through parts of the yachting industry as management and charter companies are eager to make it available to their yachts, crews and clients.

“This is exciting and will expand and push cruising down further south,” said Rupert Connor, president of Luxury Yacht Group in Ft. Lauderdale.

Yachts have always been able to visit Cuba, but yachts with ties to the U.S. — either through flag, ownership, guests or crew — have been legally restricted by U.S. laws, mostly those delineated in the Cuban Assets Control Regulations portion of the Treasury Department’s Office of Foreign Assets Control.

Key among those restrictions was not to spend U.S. money in a way that aided Cuba or its residents. But a shift in policy proposed by President Obama on Jan. 16 means travel for authorized purposes such as humanitarian or research will be easier, U.S. credit and debit cards can be used, and travelers can buy airline tickets direct from the U.S.

“The lack of money restrictions is big,” Connor said. “We know we have a big demand for Cuba.”

The United States severed diplomatic ties with Cuba in 1961. In mid-January, Obama opened talks on resuming diplomatic relations. It was unclear when final policies will be in place, but the yachting sector is watching closely.

Before the policy shift, U.S. visitors to Cuba had to apply for a special license granted on a case-by-case basis. Now, they can go to the U.S. Department of Treasury online and apply for a general license under one of 12 categories for travel, which include family, research, education, religion or humanitarian reasons. Previously, it was difficult to get the special license, said Michael Reardon, president of Hill Robinson.

“We did have a managed yacht with an owner who wanted to go to Cuba a while ago,” he said. “He looked into the educational or humanitarian project but it was hard to do and it was a big commitment to host people onboard.”

But yachts have done it, and now it should be even easier, Connor said.

“A luxury yacht is hard pressed to go as a charity, but there was an [owner] that filled his freezer with meat he gave away to Jewish synagogues, and he didn’t have problem,” Connor said.

While yacht captains and owners with U.S. ties have figured out ways to visit Cuba in the past, there still always was the shadow of the Helm Burton Act, the U.S. law that defines the economic embargo against Cuba. Part of that means insurance companies will not cover a yacht with ties to the U.S. to travel there.

“There is discussion amongst legislators about the possibility of complete repeal of the Act and some additional modifications to the embargo that would permit commerce in Cuba by U.S. businesses,” said S. Scott Stamper, senior vice president with Atlass Insurance Group.

“But until then, the embargo prohibits U.S. citizens or companies from doing business in Cuba.

“If there is an instance of property damage or bodily injury, we can’t legally adjust a claim or exchange money or authorize a marina to do repairs, or even send adjustors to review the circumstances related to the loss,” he said. “As enthusiastic as we are for our insureds’ opportunity to visit, we are anxiously awaiting to see if there are changes in the law that will allow us the authority to extend insurance coverage to include navigation to Cuba.”

He sees what most of the world sees in regards to this relationship: “As the embargo and sanctions are repealed, Cuba will likely become a regular part of every boat yacht policy,” Stamper said.

Health insurance for crew has also been a concern, but that is changing, said Mark Bononi, director of the yacht division at MHG. Previously crew with medical issues faced problems if their yacht visited Cuba.

“If crew have medical expenses, they either quit or hope they don’t get sick while there,” Bononi said. “The challenge is that the crew doesn’t get to decide if the yacht goes to Cuba.”

But since the announcement, at least one insurer launched a new policy.

A1 CUBA MS 5951

Cuban courtesy flag at the dock.

“I am sure all companies will address it, but as of today I have only heard of one so far,” Bononi said. “If a boat calls us to go, we’ll contact the insurer to see if their policies have changed or adapted.”

According to the White House, talks will also include discussions with the Cuban and Mexican governments on the unresolved maritime boundary in the Gulf of Mexico. Official documents state, “Previous agreements between the United States and Cuba delimit the maritime space between the two countries within 200 nautical miles from shore. The United States, Cuba, and Mexico have extended continental shelf in an area within the Gulf of Mexico where the three countries have not yet delimited any boundaries.”

Despite all the uncertainty, one thing is clear: discussions have begun, and things are changing for yachts with U.S. ties that want to visit Cuba. After all, yachts are all about the travel and the location.

“I ran boats a million years ago and we took a 68-footer to St. Maarten, Antigua and almost died with the weather and wind,” Reardon said. “Cuba is protected, it’s way closer and when it opens up, it will be heaven.”

“As soon as they can give the all clear, yachts will go,” Connor said, “but we can’t yet give that blanket all clear yet.”

Apply for a license to travel to Cuba from the U.S. Department of Treasury’s Office of Foreign Assets Control at www.treasury.gov/ofac. A phone operator said due to increased volume of requests, she could not say how long it will take to receive a license by mail.

Click for USCG U.S. Travel Restrictions to Cuba.

Dorie Cox is associate editor of The Triton. Comments on this story are welcome at dorie@the-triton.com.

About Dorie Cox

Dorie Cox is editor of The Triton.

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