Obama Administration stalls Cuba ferry plans, for now

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Amid an election year, the Obama Administration told Cuba ferry entrepreneurs that their plans are a no-go.

Arguing that ferries don’t fit in the administration’s current people-to-people travel policy, the Treasury Department’s Office of Foreign Assets Control (OFAC) sent a denial letter to at least one of five entrepreneurial groups vying to offer passenger service between Florida and Cuba.

Ferry service from U.S. ports to Cuba would be “beyond the scope of current policy,” OFAC said in a letter to Fort Lauderdale-based Havana Ferry Partners LLC, after consulting with unspecified State Department officials.

“This is such a shame,” said a Cuban entrepreneur in HolguĂ­n interested in selling wholesale goods to startup private businesses in Cuba. “Ferries could be a big gateway to private commerce. I have received discount offers for merchandise from stores and distributors in Florida, at extraordinary prices. But the question is how to get it here.”

The U.S. Department of State did not respond to a request for comment by deadline of this article.

“The president has the last word,” said Bruce Nierenberg, a cruise industry veteran who also applied for a license to offer Tampa-Havana ferry service, in a first stage. “For this to happen, it has to come to the White House.”

However, nothing will happen in the run-up of the presidential elections, Nierenberg said, adding that he is not making any effort to obtain a license before Nov. 12.

Even so, Havana Ferry officials said they plan to appeal and continue their push, having recruited Arent Fox LLP, a Washington lobbying firm that includes former U.S. Senator Byron Dorgan. 

“We believe in this, and will get this done,” said Jorge Fernández, a Havana Ferry investor and Cuba native.

Havana Ferry Partners is planning to offer ferry service from Port Everglades — and possibly Key West and Tampa — to Havana; Nierenberg and his United Caribbean Lines plans to offer a Tampa-Havana connection, to be followed by connections from Port Everglades and Miami. Meanwhile, America Cruise Ferries Inc., a Dominican Republic-based ferry operator with investors from France, Puerto Rico and Mexico, has said it would like to offer service connecting Puerto Rico, the Dominican Republic, Cuba and Florida. Finally, Spanish ferry operator Balearia SA initiated Miami-Bahamas fast ferry service in 2011, most likely with an eye on future Cuba service; and a pair of Florida entrepreneurs announced recently they have commissioned construction of a high-speed catamaran for Havana service from Key Largo.

America Cruise Ferries, a company controlled by French shipping entrepreneur Daniel Berrebi, last year obtained an OFAC license allowing ferry service to Cuba, but only for cargo. A U.S. subsidiary of Berrebi’s UniShipping obtained an OFAC license in 2003 to provide cargo service between U.S. ports and Cuba.

Due to inaction, OFAC effectively denied an additional license application Havana Ferry Partners submitted Jan. 31, to provide one-time ferry service to U.S. pilgrims for the visit of Pope Benedict XVI to Cuba, late this month. Havana Ferry Partners principal Leonard Moecklin said March 6 his company had a vessel on standby, but that he would need to know from OFAC by March 9, at latest, to be able to provide the service.

The denial letter came one-and-half years after Havana Ferry Partners filed its original application.

“To date, only air charter services have been permitted for the transportation of authorized travelers between the United States and Cuba,” OFAC said in the letter dated Feb. 27 to Havana Ferry Partners. “A White House initiative expanding purposeful travel to Cuba to broaden U.S. outreach to the Cuban people included, among other things, increasing the number of U.S. airports available for the operation of direct charter flights. Ferry services were not included in the group of policy changes. After consultation with the Department of State, OFAC has determined that the issuance of specific licenses … is beyond the scope of current policy.”

Havana Ferry’s Moecklin insists that ferry service would be consistent with Obama’s people-to-people policy, allowing — for instance — ailing private businesses in Cuba to obtain supplies from the United States at lower cost than via charter flights.

If it weren’t for this executive decision, U.S. sanctions regulations would allow for ferry service to Cuba, an OFAC official told Cuba Standard on background.

The sanctions statute that regulates travel services and carrier services “would permit OFAC to license the operation of passenger vessels,” the official said. By issuing a license, OFAC can override a provision in the Helms-Burton law that prohibits any vessel from docking at a U.S. port six months after having visited a Cuban port.

“However, OFAC would issue such licenses only if it has received guidance that doing so is consistent with current U.S. policy,”  the official added.

In the startup phase, Havana Ferry Partners would create 200 jobs, Moecklin said, adding that he has the support of local politicians. However, neither Rep. Allen West (R-Ft. Lauderdale) nor Sen. Bill Nelson (D-Fla.) has thrown their support behind the project.

“We wanted their help,” Moecklin said. “We just kind of gave up on it.”

Rep. West’s office did not return calls and emails from Cuba Standard.

Meanwhile, Nierenberg, whose company is based near Tampa, was complimenting Rep. Kathy Castor (D-Tampa) as “very helpful.”

In the meantime, Havana Ferry Partners is in talks with Clean Caribbean & Americas (CCA), a consortium set up by oil companies to provide spill response. Havana Ferry is offering to keep a vessel lined up to bring supplies for emergencies in Cuban waters.

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