[Code of Federal Regulations]

[Title 31, Volume 3]

[Revised as of July 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 31CFR515.206]



[Page 91-92]

 

                  TITLE 31--MONEY AND FINANCE: TREASURY

 

 CHAPTER V--OFFICE OF FOREIGN ASSETS CONTROL, DEPARTMENT OF THE TREASURY

 

PART 515_CUBAN ASSETS CONTROL REGULATIONS--Table of Contents

 

                         Subpart B_Prohibitions

 

Sec. 515.206  Exempt transactions.



    (a) Information and informational materials. (1) The importation 

from any country and the exportation to any country of information or 

informational materials as defined in Sec. 515.332, whether commercial 

or otherwise, regardless of format or medium of transmission, are exempt 

from the prohibitions and regulations of this part except for payments 

owed to Cuba for telecommunications services between Cuba and the United 

States, which are subject to the provisions of Sec. 515.542.

    (2) This section does not authorize transactions related to 

information or informational materials not fully created and in 

existence at the date of the transaction, or to the substantive or 

artistic alteration or enhancement of information or informational 

materials, or to the provision of marketing and business consulting 

services by a person subject to the jurisdiction of the United States. 

Such prohibited transactions include, without limitation, payment of 

advances for information or informational materials not yet created and 

completed, provision of services to market, produce or co-produce, 

create or assist in the creation of information or informational 

materials, and payment of royalties to a designated national with 

respect to income received for enhancements or alterations made by 

persons subject to the jurisdiction of the United States to information 

or informational materials imported from a designated national.

    (3) This section does not authorize transactions incident to the 

transmission of restricted technical data as defined in the Export 

Administration Regulations, 15 CFR parts 730-774, or to the exportation 

of goods for use in the transmission of any data. The exportation of 

such goods to designated foreign countries is prohibited, as provided in 

Sec. 515.201 of this part and Sec. 785.1 of the Export Administration 

Regulations.

    (4) This section does not authorize transactions related to travel 

to Cuba when such travel is not otherwise authorized under Sec. 

515.545.



    Example #1: A U.S. publisher ships 500 copies of a book to Cuba 

directly from Miami aboard a chartered aircraft, and receives payment by 

means of a letter of credit issued by a Cuban bank and confirmed by an 

American bank. These are permissible transactions under this section.

    Example #2: A Cuban party exports a single master copy of a Cuban 

motion picture to a U.S. party and licenses the U.S. party to duplicate, 

distribute, show and exploit in the United States the Cuban film in any 

medium, including home video distribution, for five years, with the 

Cuban party receiving 40% of the net income. All transactions relating 

to the activities described in this example are authorized under this 

section or Sec. 515.545.

    Example #3: A U.S. recording company proposes to contract with a 

Cuban musician to create certain musical compositions, and to advance 

royalties of $10,000 to the musician. The music written in Cuba is to be 

recorded in a studio that the recording company owns in the Bahamas. 

These are all prohibited transactions. The U.S. party is prohibited 

under Sec. 515.201 from contracting for the Cuban musician's services, 

from transferring $10,000 to Cuba to pay for those services, and from 

providing the Cuban with production services through the use of its 

studio in the Bahamas. No information or informational



[[Page 92]]



materials are in being at the time of these proposed transactions. 

However, the U.S. recording company may contract to purchase and import 

preexisting recordings by the Cuban musician, or to copy the recordings 

in the United States and pay negotiated royalties to Cuba under this 

section or Sec. 515.545.

    Example #4: A Cuban party enters into a subpublication agreement 

licensing a U.S. party to print and publish copies of a musicial 

composition and to sub-license rights of public performance, adaptation, 

and arrangement of the musical composition, with payment to be a 

percentage of income received. All transactions related to the 

activities described in this example are authorized under this section 

and Sec. 515.545, except for adaptation, and arrangement, which 

constitute artistic enhancement of the Cuban composition. Payment to the 

Cuban party may not reflect income received as a result of these 

enhancements.



    (b) Donation of food. The prohibitions contained in this part do not 

apply to transactions incident to the donation of food to 

nongovernmental organizations or individuals in Cuba.



[54 FR 5233, Feb. 2, 1989, as amended at 60 FR 39256, Aug. 2, 1995; 64 

FR 25812, May 13, 1999]