PRESIDENT Clinton has tried to defuse tensions with the EU and Canada by postponing a measure which would allow foreign companies to be sued in the US for certain activities in Cuba under the so called Helms Burton law.
But he has not used his presidential waiver on the enabling section which legalises future measures.
The President's action has been criticised by the Republican cosponsor of the law, Congressman Dan Burton, as "capitulating to foreign interests" and "giving aid and comfort to Castro".
Under strong pressure from the EU and Canada, President Clinton compromised on the implementation of Title III of the Act where he has flexibility on its application. He has allowed it to become law on August 1st but has postponed for six months the right of aggrieved US companies to begin lawsuits for compensation in US courts. This means that lawsuits cannot begin until next May.
But the measure in the Act which imposes travel restrictions on senior executives (and their families) of companies which exploit confiscated US owned property in Cuba is already in force and cannot be waived by the President. The EU is threatening to take retaliatory action against US businessmen if the travel ban is imposed on European executives.
So far only Canadian executives from the Sherritt mining company have been advised that they will be banned from the US unless the company ceases its activities in Cuba.
The Canadian ambassador in Washington has praised President Clinton for his waiver on the lawsuit clause and says that he hopes it will become permanent. But the ambassador said that Canada has still the problem of the travel restrictions measure.
Private groups in Canada have threatened to promote a boycott of Florida where Canadian tourists spend over 1 billion a year.
President Clinton's compromise is an attempt to manoeuvre between the demands of the Cuban American lobby for tougher action against President Fidel Castro and the fears of US businesses that they will be damaged by retaliatory measures by trading partners.
The Cuban lobby is especially strong in Florida and New Jersey which are among the key states in the presidential election on November 5th. The President compromise attempts to send a reassuring message to both the Cuban Americans and business but it leaves him open to the criticisms of both camps for not going far enough.
President Clinton admitted in a TV interview that he was being "severely criticised" by the "allies" of the US for the powers in the Helms Burton law. The State Department was known to be deeply unhappy with the effect it was having on relations with the EU, Canada and Mexico and there were even indications that US diplomats would be halfhearted in applying it.
AFP adds. The EU welcomed President Clinton's decision to delay for six months US lawsuits against foreign companies but vowed to go on fighting for the legislation on which they are based to be scrapped altogether.
"It is a welcome step," a spokesman for the Irish EU Presidency said. "We always want to have a good trading relationship between ourselves and the United States and this is something that is obviously in the interests of that."
However, he stressed that the EU remained fundamentally opposed to all the extra territorial aspects of the Helms Burton Act on Cuba and to pending legislation on Iran and Libya with similar implications.
Even though Mr Clinton backed down, a number of European countries may still go ahead with plans to enact legislation which would protect their companies against the kind of US actions envisaged by the Helms Burton Act.
Britain already has such legislation on its statute book under the 1980 Protection of Trading Interests Act. Under this, British companies can be required not to cooperate with foreign courts, by refusing to provide documents or send witnesses.