In major shift, Trump allows lawsuits against foreign firms in Cuba

The major policy shift, which will be announced on Wednesday, could expose U.S., European and Canadian companies to legal action

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President Donald Trump talks to reporters as he departs for travel to Texas from the White House in Washington
FILE PHOTO: U.S. President Donald Trump talks to reporters as he departs for travel to Texas from the White House in Washington, U.S., April 10, 2019. REUTERS/Kevin Lamarque

WASHINGTON (World2Day) – According to Reuters report, the Trump administration will allow lawsuits in U.S. courts for the first time against foreign companies that use properties Communist-ruled Cuba confiscated since Fidel Castro’s revolution six decades ago, a senior U.S. official said on Tuesday.

This major policy shift, to be announced on Wednesday, could expose U.S., European and Canadian companies to legal action and deal a blow to Cuba’s efforts to attract more foreign investment. It also shows Washington’s efforts to punish Havana over its support for Venezuela’s socialist President Nicolas Maduro.

President Donald Trump’s national security adviser John Bolton on Wednesday will explain the administration’s decision in a speech in Miami and will also announce new sanctions on Cuba, Venezuela and Nicaragua, countries he has branded a “troika of tyranny,” the official said, speaking on condition of anonymity.

However, it is unclear whether these property claims will be acceptable in U.S. courts. The European Union has already warned it could present a challenge with the World Trade Organization.

Back in January, Trump threatened to allow a controversial law that has been suspended since its creation in 1996, permitting Cuban Americans and other U.S. citizens to sue foreign companies doing business in Cuba over property seized in decades past by the Cuban government.

The complete lifting of the ban could allow billions of dollars in legal claims to move forward in U.S. courts and likely antagonize Canada and Europe, whose companies have significant business holdings in Cuba.

U.S.-Cuban relations have nosedived since Trump became president, partially rolling back the detente initiated by Obama and reverting to Cold War rhetoric. A six-decade U.S. economic embargo on Cuba has also remained officially intact.

OFFICAL SAYS THIS IS JUST A “BUMP” IN BUSINESS

Trump is still going ahead despite protests by European leaders to U.S. counterparts.

The U.S. official dismissed the EU’s warning of a possible WTO challenge and a cycle of counter-claims in European courts as doomed to fail.

Among the foreign companies heavily invested in Cuba are Canadian mining firm Sherritt International Corp and Spain’s Melia Hotels International SA. U.S. companies, including airlines and cruise companies, have forged business deals in Cuba since the easing of restrictions under Obama.

Experts are saying it is unclear how activating Title III will affect investors in Cuba given legislation in some countries like Canada blocking enforcement of Helms-Burton against their companies.

“This is a fringe policy decision that has not been tested legally,” said James Williams, president of Engage Cuba, a Washington-based lobbying group working to normalize relations with Cuba.

Some 5,913 claims held by U.S. companies and individuals have been have been certified by the U.S. Justice Department and are now estimated to be worth roughly $8 billion.

Cuban law ties settlement of any claims to U.S. reparations for damages from Washington’s embargo and what it considers other acts of U.S. aggression. Cuban estimates of that damage range from $121 billion to more than $300 billion.

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