A recent inspection operation in Sancti Spíritus has resulted in over 200 fines and the shutdown of at least five private businesses, primarily due to violations concerning pricing and the use of electronic payment systems.
The state-run telecenter CentroVisión Yayabo reported the penalties on Tuesday. The bulk of the fines were related to pricing irregularities, while others were tied to non-compliance with electronic payment regulations.
Inspectors uncovered a range of violations, including businesses refusing to accept electronic payments or charging differing prices based on whether customers paid in cash or via transfer. They also noted issues with product quality, outdated consumer information, and expired goods.
Stricter Measures Raise Concerns Among Cubans
The operation involved both municipal and provincial inspectors, along with officials from the ONAT and the Ministries of Labor and Internal Trade. It focused on establishments in key commercial areas of the city.
The news sparked a wave of criticism on social media, where many Cubans voiced their disapproval of the government's persistent reliance on fines and closures as solutions to the challenges faced by private commerce.
"Keep on with the witch hunt, and not even Martina the Little Cockroach will want to invest," one user sarcastically remarked.
Another commented, "All the businesses are closing to avoid the fines and inspectors... where will this end? It's the same old story and the problem won't be solved."
Impact on Private Businesses
Others warned that increased inspections might further diminish the available supply for consumers. "Many self-employed individuals will start closing down; the fines are quite steep, and everything will become more challenging. Things will go underground, and prices will skyrocket," an online user predicted.
Some questioned the legal procedures used to impose the penalties, referencing the Administrative Procedure Law 169/2024. They argued that inspectors are not authorized to directly impose certain fines upon detecting an infringement.
"Inspectors cannot impose fines immediately upon finding alleged violations because that is not the established procedure. If violated, the fines are void even if the infraction is valid," one commenter asserted.
Challenges in Electronic Payments
The issue with electronic payments arises amid the government's struggles to promote the digitization of the economy. Official media acknowledged in July the dismal outcomes of the initiative, with only 3.77% of transactions in Cuba being digital. In Sancti Spíritus, less than 10% of private businesses routinely accept transfers.
Entrepreneurs highlight a contradiction that complicates moving away from cash: many suppliers, wholesalers, and importers demand payments outside banking channels or in foreign currency, while businesses face challenges withdrawing the necessary cash from banks to restock goods.
"If the payment chain doesn't translate into electronic operations from wholesale SMEs and importers, everything else will continue to trend towards illegality as a normal occurrence," summarized a user.
The inspections in Sancti Spíritus are part of a broader crackdown extending to various provinces. On August 6, five businesses were shut down in Bayamo for refusing to accept payment via transfer, while similar sanctions were announced in Guantánamo.
In Havana, the municipal government of Plaza de la Revolución also warned of temporary closures of up to three months for certain pricing violations in private establishments.
The Central Bank of Cuba attempted to ease some regulations in July by removing the 5,000 pesos limit for cash payments between economic actors and reducing the commission on commerce from 1.5% to 0.8%.
However, the operation in Sancti Spíritus highlights the gap between official demands and the everyday realities of an economy marked by cash shortages, weak banking infrastructure, and a supply chain still heavily reliant on non-electronic transactions.
FAQs on Business Inspections and Fines in Cuba
What led to the business closures in Sancti Spíritus?
The closures were primarily due to violations related to pricing and the refusal to accept electronic payments.
How are electronic payments impacting Cuban businesses?
Many businesses face challenges accepting electronic payments due to infrastructure issues and the preference of suppliers for cash or foreign currency transactions.
What legal concerns were raised about the fines?
Some individuals argue that inspectors are not legally authorized to impose fines immediately upon detecting infractions, as per the Administrative Procedure Law 169/2024.