Cuba: US targets cruise lines in massive compensation case

April 27, 2023
Cuba cruise ships
The United States' Helms-Burton Act means any company that has invested in properties nationalised by the Cuban government can be penalised. Graphic: Green Left

The world’s top four cruise companies have recently lodged appeals against a December 2022 decision by a United States federal judge who held them financially liable for nearly US$451 million for using docks nationalised in the Cuban Revolution.

The four companies are Carnival Corp, Royal Caribbean Group, Norwegian Cruise Line Holdings and MSC Cruises.

The first two announced in January this year that they were appealing the decision. Since then, the other two companies have decided to follow suit.

Last year South Florida US District Court Judge Beth Bloom ordered each of the four cruise lines to pay more than $109 million in damages.

The total judgment also consists of interest which was trebled as punitive damages.

The figure was arrived at supporting the nearly $9.2 million claim certified by the Foreign Claims Settlement Commission for the Havana Docks Corporation, which had owned a 1934 concession to several piers in Havana Harbour. That concession was expropriated in 1960 by Fidel Castro's revolutionary government.

However, Havana Docks’ concessionary interest would have expired by effluxion of time in 2004 — before the alleged trafficking in “expropriated property” took place. It was only in 2016 that US-based cruise ships started travelling again to Cuba.

In addition, the Barack Obama administration allowed US citizens to travel to Cuba under a “lawful travel” exemption of the US blockade regulations and the cruise lines had been licensed by US Treasury Department to sail to Cuba.

None of this appeared to matter to the South Florida US District Court.

The action against the cruise lines was brought under Title III of the Cuban Liberty and Democratic Solidarity (Libertad) Act of 1996 (the Helms-Burton Act) which gives the heirs to assets “wrongfully” seized and not compensated for their property the right to sue companies that have profited from the use of the property.

Typically, the “heirs” bringing these actions are reactionary right-wing Cuban Americans living in Florida, many of whom have very deep pockets.

The Helms-Burton Act codifies the extraterritorial nature of the blockade, providing measures to penalise any company that invested in properties nationalised by the Cuban government.

One of the major objectives of the statute is to apply the maximum pressure on foreign companies — not just US ones — to stop trading and otherwise doing business with and investing in Cuba, with the aim of destroying the economy and bringing down the government.

The Act gives US courts the power to prosecute non-US companies for trading or investing in Cuban assets expropriated by the Revolution.

The extraterritorial effect of the Act is contrary to international law and is an extreme example of imperialist bullying by the US.

Title III of the Act had been suspended for over 20 years, rendering the right to sue for compensation provisions inoperative. However, in May 2019 then US President Donald Trump decided not to renew the suspension of Title III, thus bringing it into effect and activating the right to sue for damages.

There have been over 40 similar cases filed against shipping and other companies doing business in Cuba. However, Judge Bloom’s decision is the first successful application of Title III.

The nationalisation of US assets in 1960 occurred because the US-owned oil refineries, under pressure from Washington, refused to handle oil coming from the Soviet Union. The Cuban government was left with no choice but to place the assets under state intervention.

At the time, the Cuban economy was still largely owned and controlled by US interests, more concerned with maximising their profits than improving the living conditions of ordinary Cubans.

Washington retaliated to the Cuban government’s intervention by cancelling Cuba’s sugar import quota (some 2.72 million tonnes), banning commercial ships from docking in Cuban ports and suspending US financial credits to Cuban banks.

Behind the scenes, Washington was also funding terrorist activities against the Revolution.

This whole sequence of events led to the Cuban government expropriating the assets of all US-owned corporations in the country.

The Cuban government did offer compensation to all nations whose assets were expropriated. Indeed, appropriate compensation was paid to all except the US. The latter refused to accept any compensation on the ground that the assets of US-owned companies ought not to have been expropriated in the first place.

One may not have all that much sympathy for the big cruise lines but it is important to realise that for many years now tourism has been the lifeblood of the Cuban economy. If these types of Helms-Burton Act claims are successful, they have the potential to totally wreck the Cuban economy.

Of course, at the risk of stating the obvious, that is the underlying objective of the deplorable US legislation.

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