14ymedio, Havana, July 22, 2021 — Garage sales, a retail option that many Cuban shoppers have been using for some years, have been legalized according to an announcement that appeared on Tuesday in the Official Gazette. Another resolution also allows customers to purchase items using installment plans from retail stores that offer them.
The Ministry of Internal Commerce issued Resolution 97/2021, which legalizes these sales, describing them as “as a form of occasional retail activity” and establishes regulations that operators must follow.
These authorizations are part of a package of conciliatory measures the government adopted in response to a wave of countrywide protests on July 11. The first of these measures, the unrestricted import of food and medicine, came just three days after the unprecedented demonstrations.
The resolution states that a commercial or self-employed license is not required to operate garage sales but does indicate that items to be sold “must be for domestic and personal use, used, pre-owned or new.” Transactions must take place in garages, covered entries or other residential areas so as not to obstruct sidewalks and roads.
However, the sale of large consignments of imported and domesctically produced items as well as animal skins, rare woods and food is not allowed. Permit applications to conduct garage sales must be submitted to the Municipal Administration Council office at least one week prior to a sale’s scheduled date.
The resolution states that permits can be issued both electronically and in person. A minimum fee may be charged for the permit, the proceeds of which will go to the local government, but will never exceed fifty pesos.
As though these regulations were not enough — in other countries, such as the United States, this activity is conducted freely and informally by private individuals — municipal government authorities will determine what days these sales can be take place as well as the hours, locations and maximum number of consecutive days of operation. A retailer will be able to submit one application for all dates scheduled within a year, half-year or trimester.
In 2013 the government prohibited the sale of imported goods in private stores, with regulations that made the sale of clothing brought into the country by so-called ’mules’ from countries such as Mexico, Panama and Russia impossible.
Garage sales have become more relevant for many Cubans in the last two years due to acute shortages that prevail throughout the network of state-owned retail stores. With the start of the pandemic, promoters of these sales have organized into WhatsApp groups which, in some cases, provide home delivery.
Some groups, such as those involved in animal protection, have used garage sales to raise money for the rescue, medical treatment and adoption of dogs and cats found on the streets. Until now, this type of activity was conducted without legal protection but it is becoming more and more common.
Along with garage sales, the Ministry of Domestic Commerce also legalized retail installment plans, but only for individuals and only for products such as furniture, mattresses, bicycles and home appliances costing more than 2,500 pesos.
To take advantage of this form of payment, purchasers must be Cuban citizens and permanent residents, must reside in the province where the items are being purchased, be over eighteen years of age, and be able to make legal and financial decisions. A customer must also be able to demonstrate that he or she has a regular, steady source of income.
To qualify for an installment plan, a purchaser must provide proof of identity and certification from a guarantor that he or she has the financial means to make the payments. Also necessary is certification from the purchaser’s employer indicating his or her salary or, in the case of self-employed workers, a personal income tax affidavit. State employees can use installment plans through “payroll discount” through prior agreement between the store and the employer.
Pensioners or social security beneficiaries who want to buy something in installments will have to provide an income statement from the state Labor Office or the National Institute of Social Security.
The maximum interest a person may be charged is 2.5% over the purchase price. The buyer will be required to make a downpayment, which is negotiable but can never be more than 20%. The payment period may not be longer than one year.
The regulation states that, if a customers fails to fulfill the terms of the original or revised contract, the store is authorized to “repossess the item” without providing a refund of the amount already paid.
Installment plans will not be available, however, at stores that only accept payment in freely convertible foreign currency, which are among the few state-run retailers still selling home appliances and hardware amid severe shortages plaguing the network of peso stores.
COLLABORATE WITH OUR WORK: The 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.