On March 2, 2026, Miguel Diaz-Canel stressed the need for urgent transformations in Cuba's economic and social model. Hours later, Decree-Law 114/2025 was published, regulating partnerships between state entities and private actors. The measure institutionalizes cooperation while preserving centralized state control.
On March 2, 2026, during a Council of Ministers meeting, President Miguel Diaz-Canel stated that urgent transformations in the country's economic and social model must be promoted. Cuban state media reported on the session that day, and shortly afterward, the Official Gazette published Decree-Law 114/2025 along with a complementary regulation on partnerships between state-owned enterprises and private actors.
The new rules permit the formation of 'domestic joint ventures' as mixed limited liability companies between state and private entities, as well as mergers, equity acquisitions, and economic association contracts. All such operations require approval from the Ministry of Economy and Planning, inter-ministerial evaluations, and authorization from the superior body overseeing the state entity.
A notable feature is unilateralism: only corporations with 100 percent Cuban capital or state limited liability companies can absorb private entities, but the reverse is not allowed. Mixed companies must conform to policies set for state-owned enterprises and can be rejected on grounds including public order, defense, national security, economic viability, or prior tax non-compliance.
Despite these limits, the new entities will be able to export and import directly under current legislation, set wages autonomously, distribute profits, and manage their assets. They remain subject to the national foreign currency allocation system, must submit periodic reports on strategic indicators to the state, and require ministerial approval for significant changes.
Overall, the regulation provides clearer guidelines for cooperation, acknowledging the private sector's role in Cuba's economy. It does not, however, challenge the dominance of state enterprises or decentralize economic power, preserving centralized administrative oversight for partnerships.