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Friday, April 13, 2001

Cuba’s No-Cubans Rule Puts Cruise Lines in Uncharted Waters

13 April 2016

Cuba’s No-Cubans Rule Puts Cruise Lines in Uncharted Waters
Photo: gary yim / Shutterstock.com

(Bloomberg) — Carnival Corp.’s maiden voyage to Cuba next month will be filled with almost 700 cruisers looking to spend time assisting in economic, environmental and community development there. The one thing the boat won’t be carrying, however, is any Cubans. Raul Castro’s government prohibits native-born Cubans from returning by sea, and makes other forms of travel difficult for them as well, a remnant of discord that remains unaltered by U.S. President Barack Obama’s recent visit. Into the middle of this now comes the U.S. cruise industry. Faced with the choice of waiting for Castro to lift the prohibition or gaining access to Cuba immediately, companies such as Carnival have chosen the latter. The argument is that engagement may help facilitate change—but not everyone is happy with that calculus.“Something precious is lost when a foreign government dictates what kinds of U.S. citizens can sail out of the Port of Miami,” Miami Herald columnist Fabiola Santiago, who is Cuban-American, wrote after she was denied a ticket for Carnival’s new Fathom cruise to Cuba.

Carnival said it asked Cuba to reconsider the regulation. “We understand and empathize with the concerns being voiced and will continue to work the issue with Cuban officials,” Carnival spokesman Roger Frizzell said in a statement. “It is our hope and intention that we will be able to travel with everyone.”

For the moment, Cubans may not. The rule dates to the 1980s when that nation loosened some restrictions to allow immigrants to return to see family, said Wilfredo Allen, a Cuban-American immigration attorney in Miami. He said enforcement is spotty, with the closest scrutiny aimed at Cuban-Americans, not those who live in Mexico, the Caribbean or elsewhere.

Carnival officials signed agreements with Cuba last month during Obama’s historic two-day trip, allowing the MS Adonia, leaving from Miami on May 1, to arrive the following morning in Havana. It will be the first U.S. cruise liner to land there in more than 50 years.

Under U.S. laws, travel to Cuba is permitted only for Americans who fall into one of 12 categories outlined by the Treasury Department, including professional research and meetings, athletic events, journalism, educational activities and “people-to-people” travel.

The new Fathom brand, Carnival’s 10th cruise line, is aimed at the “social-impact travel” market, or travelers who are attracted to meaningful experiences with deeper social purpose. Carnival launched the line in June with plans for 7-day cruises to the Dominican Republic, where passengers would volunteer with local organizations. Fathom later added Cuba as a destination.

Yesterday, Fathom was forced to cancel its first “soft launch” cruise to the Dominican Republic this week after the U.S. Coast Guard required further testing of the ship. The April 17 inaugural cruise will depart on schedule, Fathom said.

As Carnival prepares for its first Cuba trip, its rivals are lining up to follow. Owen Torres, a spokesman for the second-largest cruise line, Royal Caribbean Cruises Ltd., said his company is still awaiting approval from Cuba to sail there and hopes to announce service “in the near future.” Norwegian Cruise Line Holdings, whose chief executive, Frank Del Rio, was born in Cuba, has also applied for Cuban permission to sail to the island. Del Rio has said the company’s upscale Oceania line is likely to be Norwegian’s first brand to visit Cuba.

Air or Sea

The U.S. State Department, through a spokesperson, said that ”it’s aware of reports that Cuban rules and regulations make it difficult for Cuban-Americans to travel to and from Cuba via sea,” and that the administration encourages “the Cuban government to ensure all U.S. citizens, regardless of national origin, have the opportunity for authorized travel to Cuba, whether by air or sea.”

The biggest curiosity about the Cuban rule is that it bars entry through a relatively little-used portal, as compared with Cuban airports. Using U.S. charter flights and regular airline service from other nations, native Cubans can come and go without too much effort. Allen said there is a logic to the Cuban government’s position.

“They don’t care about the flights because they pretty much control at the airport who comes in and who goes out and they control it from the get-go,” he said.

So, Cuban-American immigrants who want to return to visit family or friends must fly. And when U.S. airlines are awarded routes to Cuba—a process expected to conclude this summer—Cubans who fled the communist revolution will have a range of simpler, more affordable air travel options. Almost every U.S. airline, save for Virgin America Inc. and Allegiant Travel Co., is seeking access to Cuba, with most of them wanting to fly to Havana. Only 20 daily nonstop round-trips are permitted from the U.S. to Havana, which has made the capital oversubscribed.

Because the American embargo precludes tourism, much of the initial U.S. business to the island nation is expected to be among Cuban-Americans eager for a more affordable route from Florida. In the first 10 months of last year, 77 percent of the charter flight passengers to Cuba from Miami, Tampa and Orlando were Cuban-Americans, according to the Havana Consulting Group, a U.S. firm that focuses on business opportunities in the Cuban market.

Even with regular flights, it won’t be too easy to get there for those who were born in Cuba. Cubans who immigrated after 1970 must have a Cuban passport and a visa to visit the country, even if they’re American citizens with a U.S. passport. A Cuban passport typically takes months to receive and must be renewed every two years. Cubans who left the country before 1970 must apply for a $200 visa that allows travel in Cuba for 30 days.

Still, the muted public reaction in Florida, where many Cuban-Americans live, has been telling. Demonstrators haven’t flocked to Carnival’s Miami headquarters, nor have there been widespread calls for a boycott. Allen, a critic of the Cuban government, considers that emblematic of a broader moderation in political views about U.S.-Cuban relations.He nevertheless called Carnival’s acquiescence “disappointing.” That said, he predicts Cuba will retain dual rules for the cruise industry and airlines regarding Cuban-American travelers. “It all goes back to the Cuban government being a little bit schizophrenic,” he said.

© 2016 Bloomberg L.P

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