During the third ordinary session of the National Assembly's tenth legislature, Manuel Marrero, the Prime Minister of Cuba, announced significant changes to the regulations for micro, small, and medium-sized enterprises (MSMEs) and self-employment (TCP).
Among the primary changes for MSMEs and Non-Agricultural Cooperatives (NCAs) is the decentralization of approval authority to the Municipal Administration Councils (CAM), the implementation of new regulations for approving social purposes, and the requirement to declare the legality of the source of funds. New criteria for becoming a partner or administrator have also been set, accompanied by the introduction of an internal control system. State-owned MSMEs will continue to be approved by the Ministry of Economy and Planning, and residency status is now required for partners of an MSME or NCA. Approval timeframes have been extended as well.
Regarding self-employment regulations, the number of employees will be limited to three people, including family members, and social security affiliation is now mandatory. Additionally, TCPs exceeding a certain annual revenue threshold must transition to legal entities. Marrero emphasized that these measures are not an attack on non-state management forms or a step backward but rather necessary corrections and redirections for each economic actor to play their appropriate role.
The creation of a new Institute for the Attention to Non-State Economic Actors was also announced, with its headquarters and structure set to be operational by September. According to the Cuban Prime Minister, these reforms aim to strengthen the Cuban economy and ensure that all economic actors contribute effectively to the country's development. Recently, the Council of Ministers approved six decree laws to be presented to the Council of State, updating the legal provisions for MSMEs, self-employed workers, and private sector companies in Cuba.
"Contrary to what the enemies of the Revolution claim, this is not a crusade against MSMEs or non-state management forms. These policies were approved at the Communist Party Congress," Marrero stated regarding the new decrees. The extraordinary meeting took place on July 12. The Cuban Prime Minister acknowledged that the initial regulations had legal gaps leading to "distortions" and admitted that there were mistakes in the state counterpart's service contracting with the private sector.
Key Changes in Cuban Private Sector Regulations
To provide a clearer understanding of the recent regulatory changes announced by the Cuban government, we have compiled a list of frequently asked questions and their answers.
What are the new approval authorities for MSMEs in Cuba?
The approval authority for MSMEs has been decentralized to the Municipal Administration Councils (CAM).
What are the new criteria for self-employment in Cuba?
Self-employed individuals can employ up to three people, including family members, and must be affiliated with social security. Those exceeding a certain annual revenue must convert to legal entities.
When will the new Institute for the Attention to Non-State Economic Actors be operational?
The institute is expected to be operational by September.