What President Trump's new Cuba policy means for American business

MIAMI – Some U.S. executives who do business with Cuba breathed a sigh of relief after President Donald Trump outlined his new Cuba policy in Miami because it won't have much impact on their companies. But others have pressed the pause button until they see how the new regulations implementing the changes are written.

Lawyers who help firms navigate the thicket of laws and regulations governing the embargo and dealings with the island have been combing through a memorandum that Trump signed on June 16 as well as three pages of frequently asked questions issued by the U.S. Treasury's Office of Foreign Assets Control (OFAC) and a White House fact sheet to get a sense of the new policy.

Until the regulations are written, that's all they have to go on. Trump has mandated that the regulation-writing must begin by mid-July.

"Until the regulations change, everything is status quo," said Yosbel Ibarra, a Miami lawyer on Greenberg Traurig's Cuba practice team.

How long it will take to write new rules is anybody's guess, but it isn't an easy task because multiple agencies and departments will be involved. Some key posts that would have oversight over the new policy also have yet to be filled by the Trump administration, according to lawyers.

Don't expect a rush by U.S. companies that have proposals pending before the Cuban government to get deals inked before the new rules go into effect, say lawyers and business consultants.

"The way corporations are, when they know rule-making is underway, they are always going to hold up until the regulations are written," said Robert Muse, a Washington lawyer who specializes in U.S.-Cuba law. "They are not going to set themselves at the far end of the branch."

The prohibition on doing business with the military is significant because since the 1990s, the Cuban military has been taking control of ever larger chunks of the economy. Many officers have been sent abroad for business training.

Now the military conglomerate GAESA controls an estimated 40 to 60 percent of the economy.

The military's Gaviota Tourism Group, for example, controls or has joint ventures with foreign partners in 64 hotels and villas, including many resort hotels as well as the Saratoga, a favorite of visiting congressional and business delegations, and the new luxury Gran Hotel Manzana Kempinski in Havana.

Even though former President Barack Obama opened up more opportunities for U.S. companies to do business in Cuba, not that many agreements have been finalized. Most are in the transportation sector, the telecommunications industry and in the hospitality sector.

Some of the U.S. companies have signed deals with military entities. Telecommunications projects, for example, go through ETECSA, the state communications company that is controlled by the military, and Starwood Hotels & Resorts, now a part of Marriott International, has signed an agreement with Gaviota, the military tourism company, to manage a Cuban hotel as a Four Points by Sheraton.

Meanwhile, the coming prohibition on business with the Cuban military has prompted calls from clients who want to make sure exactly who their Cuban counterparts and business partners are, Ibarra said.

But even companies looking at business that seemingly have nothing to do with the Cuban military are wary.

"I've already had a client call and say I guess I'm not going forward [in Cuba]," said Charles Serrano, a Chicago business and travel consultant.