Cuba regulates for the first time the partnerships between state and private enterprises, but maintains state control

Cuba published on March 3, 2026 in the Official Gazette No. 24 Ordinary the Decree-Law 114/2025, approved by the Council of State on December 10, 2025, which regulates for the first time the partnerships between state and non-state business entities, including private micro, small, and medium enterprises and cooperatives. The regulation comes into effect 30 days after its publication, meaning at the beginning of April 2026, and establishes four types of alliances between the state and private sectors.

The four pathways established by the decree are: the formation of mixed Limited Liability Companies (S.R.L.), the acquisition of shares in existing private S.R.L. by state entities, the absorption of private S.R.L. by state companies, and economic association contracts without the need to create a new legal entity.

Despite the apparent openness, state control remains a central pillar of the model. All operations require an explicit resolution from the Ministry of Economy and Planning (MEP), which directs and supervises policy in this area and has a period of 10 days to act, according to Article 54.1 of the decree. The evaluation committee for applications is chaired by a deputy minister and includes the General Directorate of Planning and Development.

Mixed entities will have business autonomy: they will be able to define their administrative structure, number of employees, salaries, and open businesses both in Cuba and abroad. They will also be able to export and import directly and will not be subject to the Economic Plan. However, they must report strategic indicators to the State in areas such as energy, investments, foreign currency, and food.

The decree expressly prohibits these associations from operating in the sectors of health, education, and activities related to the armed institutions —Fuerzas Armadas Revolucionarias (FAR) and Ministerio del Interior (MININT)—, except for certain exceptions. For mergers and acquisitions, a certification of valuation of real estate and intangible assets owned by the state to be transferred is also required.

Eligible state partners include state-owned enterprises, state-run limited liability companies (S.R.L.), 100% Cuban stock companies, and budgeted units with special treatment. On the private side, small and medium-sized enterprises (mipymes) with up to 100 employees, as well as agricultural and non-agricultural cooperatives, may participate.

The Decree-Law 114/2025 fills a legal void that existed since the legalization of micro, small, and medium-sized enterprises (mipymes) in August 2021 through Decree-Law 46. That regulatory framework, which allowed the emergence of limited liability companies with their own legal personality, explicitly prohibited mixed companies between state and private capital, limited to one enterprise per person, and banned Cuban partners abroad.