Here’s What You Need to Know About Cuba’s Changing Domestic Property Rights

Here’s What You Need to Know About Cuba’s Changing Domestic Property Rights

The Cuban constitution establishes two types of property rights, those guaranteed to Cuban citizens and those guaranteed to the state.

According to Cuba’s constitution, all Cuban citizens are granted the right to own their homes as well as, “other possessions and objects which serve to satisfy one’s material and cultural needs.” Likewise, Cubans are allowed to own the tools relevant to their work, as long as these tools are not, “used to obtain earning derived from the exploitation of the work of others.”

The Cuban constitution grants additional property rights to small farmers. Farmers are allowed to own their land on the condition it is used for agricultural production, with subsequent rights including the authorized sale, swap, or transfer of land to the state or other small farmers. However, mortgages, leasing, and other liens on farmer’s lands are prohibited. Farmers may also group themselves, contingent on state approval, and own the resulting agricultural production cooperatives and associated lands. These cooperatives are exempt from seizure and taxes, and their land may be transferred to the state or to other similar cooperatives.cohiba cuban cigar

State property encompasses all land not owned by small farmers or their cooperatives, and includes, “subsoil, mines, mineral, plant and animal resources in the Republic’s maritime economic area, forests, waters, and means of communications.” It also comprises “the sugar mills, factories, chief means of transportation and all those enterprises, banks and facilities that have been nationalized and expropriated from the imperialist, landholders and bourgeoisie, as well as the factories, enterprises and economic facilities and scientific, social, cultural and sports centers built, fostered or purchased by the state and those to be built, fostered or purchased by the state in the future.”

State property, except in extraordinary circumstances, can never be transferred to a person or legal entity. Likewise, “the press, radio, television, cinema, and other mass media are state or social property and can never be private property.”
The Cuban government began liberalizing property rights during the economic crisis known as, “ the Special Period.”

In 1993, for example, the Cuban government issued Decree Law 142, the purpose of which was to distribute lands previously used by state-run farms to private farmers and cooperatives.

While farmers could not own the newly available land, they could own the goods they produced on that land and the profits from selling their products in state markets. The following year, further reforms allowed farmers to sell excess products at private markets, marking the first time the Cuban government allowed market forces to govern, to some extent, the sale of privately owned items.

After succeeding his brother, Fidel, in 2008, President Raúl Castro further loosened restrictions over personal property rights in Cuba. Months into his term, an internal memo was circulated within the government approving the sale of certain electronic devices and appliances that were previously restricted. While the relaxation was officially attributed to the expanded availability of electricity for consumers to power these new devices, in actuality, it was the first step of many Raúl Castro has made in liberalizing domestic personal property rights in Cuba.

The legalization of sales of electronic devices and appliances, including DVD players, cellphones, microwaves, televisions, computers, and the like, was an important step that had to be taken before Cuba could begin to import these consumer goods.

While many of these items were already traded in the Cuban black markets at very high prices, Cuban citizens can now purchase these goods legally, providing increased market opportunities for foreign exporters of such products. For example, cellphone ownership in Cuba increased from 330,000 in 2008 to 1.3 million in 2011.

Because Cuba produces few consumer electronics of its own, these newly purchasable goods demonstrate how strengthening personal property rights has the potential to spur increased trade with foreign suppliers.

Cuban Real Estate

Under today’s laws, persons of US jurisdiction would be violating US criminal law if they directly purchased real estate in Cuba. Furthermore, Cuban law restricts foreign ownership in Cuban real estate except in several developments designated for foreign ownership. It has been rumored that Cuba Americans are investing in Cuban real estate via local relatives.

Here’s What You Need to Know About Cuba’s Changing Domestic Property Rights was last modified: June 27th, 2016 by Cuba Journal

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