OFAC closed the Cuba U-turn on 30 September. A dollar payment with a Cuban interest now comes back even when neither party is American

The US Treasury's Office of Foreign Assets Control (OFAC) published two Cuba rules on 30 September. One amends the Cuban Assets Control Regulations (CACR), the core embargo rules. The other creates a new set, the Cuba Sanctions Regulations, to carry out Executive Order 14404 of 1 May 2026. OFAC also issued five new FAQs, amended 29 others and published an alert titled "Expanded Sanctions Against Cuba".

Those are the main changes; the rules also narrow educational travel. The travel changes will get the headlines. For a European company or bank, the two financial changes matter more.

Until 30 September a bank subject to US jurisdiction could process a dollar payment in which Cuba or a Cuban national had an interest, provided the transfer started and ended outside the United States and neither the payer nor the payee was subject to US jurisdiction. This was the U-turn licence in 31 CFR 515.584(d). It let a Spanish company pay a Cuban counterparty in dollars through a New York correspondent.

OFAC removed it. Section 515.584(d) now authorises those banks to reject such transfers instead of blocking them; processing them is no longer authorised. OFAC also removed, in 515.584(e), the authorisation to unblock and return transfers the old licence would have covered. Rejected means the funds go back to the sender. Blocked would have meant frozen in the United States.

A dollar payment with a Cuban interest that clears through a US bank, or through a foreign subsidiary of one, will come back. Before you discover that on a live invoice, check which of your Cuba-related flows are denominated in dollars and which correspondent they route through.

The Cuba Restricted List is published by the State Department, not OFAC. It names entities and subentities that the State Department says are controlled by, or act for, the Cuban military, intelligence or security services. It is not part of the SDN List, so an SDN screen will not find its entries.

Under the 2017 version of National Security Presidential Memorandum 5, persons subject to US jurisdiction were barred from direct financial transactions with those entities, meaning acting as the originator or the ultimate beneficiary. That ban stays. From 30 September the ban also covers indirect ones. Under amended 31 CFR 515.209, an indirect financial transaction is taking part in a funds transfer without being its originator or ultimate beneficiary, when either of them is on the list, whether by wire, card, cheque or cash. That reaches a correspondent bank in the middle of the chain, a card acquirer, or a travel agent collecting money for a listed hotel.

Two features of 515.209 cut the other way. A company owned by a listed entity is not restricted unless the State Department names it too, so there is no 50 percent rule here, unlike the SDN List. And travel arrangements and commercial engagements that were in place before an entity was listed are carved out. The State Department also keeps a separate Cuba Prohibited Accommodations List, covered by 515.210.

OFAC extended the anti-evasion prohibition in 31 CFR 515.201(c) to cover 515.209. It also narrowed 18 general licences that had excluded only direct transactions with listed entities, among them those for travel, family visits, support for the Cuban people, internet services and certain financial transactions. Each now excludes indirect transactions as well.

The Cuban embargo reaches further than most US sanctions programmes. Under 31 CFR 515.329, a person subject to US jurisdiction includes US citizens, residents and companies, and any entity, wherever organised, that they own or control.

A Dutch, Polish or Spanish subsidiary of a US group is therefore bound by the new indirect-transaction ban. A European company with no US owner is not bound by the CACR directly, but it meets the rules through its banks, its US customers and any dollar payment that touches a US correspondent.

The new part 516 is narrower. It binds US persons in the ordinary sense, defined in 31 CFR 516.316: citizens, permanent residents, US-organised entities and their foreign branches, and anyone in the United States. A Dutch subsidiary of a US group is bound by the CACR's indirect-transaction ban but is not, on the text, a US person under part 516.

The new Cuba Sanctions Regulations, 31 CFR part 516, implement Executive Order 14404, "Imposing Sanctions on Those Responsible for Repression in Cuba and for Threats to United States National Security and Foreign Policy". OFAC says it will add more provisions later.

People and companies designated under the order appear on the SDN List with their own tag, [CUBA-EO14404], separate from the older [CUBA] tag. OFAC added 11 entries with it on 17 September: three individuals and eight state-owned enterprises. The eight are three nickel-sector companies in Moa and one in Nicaro, in Holguin province, and four military research centres, three in Havana and one in Camaguey. The tag has not been stable. OFAC's first E.O. 14404 designations, on 7 May, were published as [CUBA-EO], and the May updates to GAESA and Moa Nickel SA used the same string.

The order reaches non-US banks. OFAC's alert says foreign financial institutions that conduct or facilitate significant transactions for a person blocked under E.O. 14404 may be sanctioned. Note 3 to 516.201 says such banks go on OFAC's existing CAPTA List, the List of Foreign Financial Institutions Subject to Correspondent Account or Payable-Through Account Sanctions. General Licence 1 of 7 May 2026 authorises transactions under the order that are already authorised or exempt under the CACR, such as certain family remittances and deliveries of food, medicine and medical devices.

OFAC's alert says professional-meetings travel was previously authorised under "31 CFR § 560.564(a)(2)". Part 560 is the Iran programme. The provision is 31 CFR 515.564, as FAQ 1275 and the CACR rule both say.

1. Find dollar payments with a Cuban interest that route through US banks and agree an alternative with the counterparty before the next invoice.
2. Screen Cuban counterparties against the Cuba Restricted List as well as the SDN List. Some names sit on both, but neither list is a subset of the other, and a subsidiary of a listed entity is restricted only if named.
3. If you are owned or controlled by a US person, treat intermediary roles as prohibited when a listed entity is the payer or payee: collecting, forwarding or settling funds for it.
4. Add [CUBA-EO14404] and [CUBA-EO] to the tags your rules treat as Cuba-related, so that matches under the new order are not filtered out by rules written for [CUBA].
5. Travel businesses: stop selling professional-meetings and group people-to-people trips under the removed licences. The wind-down for professional-meetings travellers already in Cuba ends on 30 October; people-to-people trips with at least one transaction completed before 30 September are grandfathered.

We screen the OFAC SDN List as OFAC publishes it, as one of the sources on our coverage register, so entries tagged [CUBA-EO14404] arrive with the file. The State Department's Cuba Restricted List is not on that register today, so a Cuba Restricted List check has to be run separately against the State Department's published list.

This post reads the two OFAC rules published on 30 September 2026, OFAC's alert, FAQs 1271 to 1275, the 17 September designations and 31 CFR 515.329. It does not cover the 29 amended FAQs or the travel rules in detail, and it is not legal advice on any particular transaction.

These are US measures. We have not considered how EU law, including the EU Blocking Statute, treats compliance with them by EU companies; that is a question for counsel.