Airlines May Have Violated Cuba Sanctions, SEC Filing Says

A South American airline may have violated U.S. sanctions against Cuba, the airline said in an October filing with the Securities and Exchange Commission. Avianca Holdings said it recently became subject to U.S. sanctions regulations when its parent company, Synergy Aerospace Corp., conducted a 2018 share-transfer with a Delaware-based company “wholly-owned” by Synergy, the filings said. Soon after the transfer, Avianca said it discovered its “regularly scheduled” flights between Central and South America and Cuba were subject to U.S. laws and may have violated the U.S. Cuban Assets Control Regulations.

The company submitted a voluntary self-disclosure to OFAC in September, the filing said, and plans to request authorizations for its subsidiary airlines to continue flights to and from Cuba during a wind-down period or until the company “is no longer subject to the CACR.” The company said it has received “no assurance that such request will be granted” but is “committed” to cooperating with OFAC. “It is too early to predict what action OFAC may take in this regard (including sanctions and fines) and what effect such action could have on the Company’s reputation, business, financial position or results of operations,” the company said.