Quandary: Attorneys Puzzle Over Protection for Doing Business in Cuba

Jennifer Olmedo-Rodriguez Buchanan Ingersoll & Rooney

Jennifer Olmedo-Rodriguez
Buchanan Ingersoll & Rooney

Quite a few attorneys are wondering what legal recourse U.S. companies will have if business deals in Cuba go south.

Arbitration is the obvious answer. But in the U.S., Cuba’s court system is perceived as not being independent, making many attorneys wary of their chances of winning and collecting should a contract be breached, particularly in cases sensitive to the Cuban government, said Jennifer Olmedo-Rodriguez, a shareholder and commercial litigator with Buchanan Ingersoll & Rooney, who has been studying trade in Cuba for clients.

U.S. contract concerns about foreign courts are ameliorated by a clause stipulating mediation or international arbitration in a third country. But that third-country option is not always available in Cuba, and whether the Cuban government will execute a judgment in favor of a foreign investor remains a concern, attorneys said.

“We’ve asked them, ‘Have there been instances where the alternative dispute resolution has found against the Cuban government and the Cuban government has paid foreign investors?’ ” Olmedo-Rodriguez said. Cuban officials have repeatedly said yes, but documentation has not been provided.

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