Last week, the approval of the new policy for wholesale trade has gone almost unnoticed. In your November monthly meetingthe Council of Ministers changed (again) the requirements for wholesale sales by MSMEs and non-agricultural cooperatives (CNA). The measure ends a year of uncertainty about who can engage in wholesale trade and under what conditions. In this article I clarify how the rules of the game remain and their impact on Cuban companies and families.
A year of doubts
The Ministry of Internal Trade (MINCIN), as the State regulatory entity, defines wholesale trade as the business to business sales. Therefore, a furniture producing company that supplies the offices of another business makes wholesale sales. The same with the beer and soft drink suppliers of a cafeteria. On the other hand, businesses that sell directly to the population are retailers. In other countries, rankings vary based on other factors such as the amount of the purchase.
Until the end of last year, all MSMEs, CNAs and self-employed workers (TCP) with commercial activity could carry out wholesale no restrictionsas long as they had the commercial license issued by the MINCIN.
The Resolution 56 of the MINCIN, published in December 2024, introduced two important changes in this activity by private companies: 1) restriction on the number of companies that can carry out wholesale trade, and 2) mandatory intermediation of state companies in commercial operations. In practice, MSME-to-MSME sales would no longer be direct, since the seller had to hire a State marketer to reach the buyer.
As a consequence, fewer companies could sell wholesale, the value chain was lengthened with an unnecessary intermediary, operating costs increased and the price would be paid by the last link: Cuban families.
The rejection of the norm caused the Government to would postponeand a few months later he announced his indefinite suspension. In a recent reportthe Prime Minister described it as “very restrictive.” However, the climate of uncertainty was already generated, until now that the Council of Ministers has spoken.
Who can sell wholesale?
In addition to the aforementioned uncertainty, so many regulatory changes in a short time generate inevitable confusion. Next, I explain What businesses can sell wholesale? as of the date of this article, which includes the Council of Ministers’ rectification of November 2025:
- MSMEs and CNAs with the main activity of wholesale trade. The corporate purpose of private businesses in Cuba is divided into: a main activity and several secondary ones. It is a formula inherited from state-owned companies, where the State makes the distinction between its fundamental task and the rest of the complementary or accessory activities that the entity can carry out to generate income. For MSMEs it has sometimes been a straitjacket. Specifically, only 408 MSMEs Their main activity is wholesale trade, according to official figures. This is the hard core of private wholesale trade in Cuba: it includes importers and national distributors. The thousands of MSMEs and CNAs whose activity is secondary are excluded from wholesale trade. Here a market concentration has occurred in relatively few players that is detrimental to competition, price reduction and the economy.
- MSMEs, CNA and TCP that carry out productive activities. Businesses that produce goods may sell them wholesale or retail. For example, a MSME that makes ice cream or a TCP that makes furniture may sell to the population or to other companies. They will not be able to sell ice cream or furniture not produced by them.
- MSMEs and CNA producers can sell raw materials and products associated with their activity. In addition to the previous condition, MSMEs and CNAs with productive activities will be able to wholesale not only the final good (ice cream), but also its inputs and associated products (milk, flavorings, eggs…).
Who can’t sell wholesale?
- TCP. Only producers can sell their production wholesale. The figure of the TCP wholesaler disappeared with Resolution 56, a measure that remains. No self-employed person can import containers to sell to other businesses, which puts those who have operated this way until now in trouble. At first glance, the solution could be to convert the TCP business to MSME, but the approval of new private companies is virtually stopped.
What about the state intermediary?
State intermediation to sell wholesale is removed in a correct decision by the Government. Private businesses will be able to sell directly without hiring State marketing companies. In fact, they will be able to sell directly to: state companies, budgeted units, commercial companies with 100% Cuban capital; non-profit associative forms; religious institutions and fraternal associations; diplomatic missions; consular offices; representations of international organizations; foreign commercial representations; foreign investment modalities; users or concessionaires of the Mariel Special Development Zone, and other non-state economic actors. Logically, operations will be formalized through contracts.
Will there be new private wholesale trade businesses?
Between 2021 and 2024, the Ministry of Economy published the new approved MSMEs weekly, until this practice ceased in May. If you review the listingssince July 2023, “trade” MSMEs stopped appearing, indicating that this was the first activity to be suspended until the current almost total stoppage.
The Minister of Internal Trade said that “(…) the approval of new businesses to carry out wholesale trade activity must be carried out (…) conditional on its relationship with the territorial and country development strategy, as well as being endorsed in the corporate purpose as the main activity.” This phrase could be interpreted as the resumption of authorizations for private wholesale trade, but with a fundamental restriction: the “relationship” with the local and national strategy, a criterion that leads, without a doubt, to discretion.
What’s next?
The long and contradictory saga of wholesale trade appears to have reached its plateau state, for now. All the agents involved (Government, state marketing sector, private marketing sector and families) have taken their positions, some with more advantages than others, in a non-optimal solution.
The publication of the legal norms that regulate what is published in the press and the television report on the meeting of the Council of Ministers is expected. The new rules modify not only Resolution 56, but the Decree 107/2024a higher-ranking standard that generally regulates all unauthorized activities for the private sector. Although the rope has been “loosened”, there are still high (bureaucratic) barriers to the entry of new competitors in the private commercial sector.
Private marketers will continue to concentrate market powerin a trend that harms supply and prices. There are 408 registered MSMEs, but not all of them operate in the same part of the chain. Some are importers of goods that are then sold in shops, restaurants and other companies. The rest are local distributors and marketers, who are responsible for selling and transporting merchandise from warehouses to their destination, which includes interprovincial trips. There is also no evidence that the 408 are operating, so the size of the sector may be even smaller.
Wholesale trade is the source of the retailer. The fact is that Cuban families’ consumption is taking place mainly in the private sector (55% of purchases are in MSMEs and TCPs, according to the ONEI). Policy cannot be restrictive, but must adopt an open approach with precise regulations to encourage supply and production.
The wholesale trade policy can be comprehensive if the following are established:
- Clear and open rules for the entry of new actors. The critical supply situation requires a saturated commercial sector. The trading activity is very lucrative and operates as an initial phase where businesses raise capital to then invest in productive and more sustainable activities in the long term.
- Incentives to import raw materials and inputs, over final goods. This may include exemption from tariffs, lower tax burden for the private importer or facilities in contracts with large players such as state, mixed or foreign companies. Currently there is an extremely bureaucratic system, where each importer must request a tax reduction punctually and with due arguments. A single structure of the Ministry of Finance and Prices is in charge of processing all applications that may be submitted.
- Credits in foreign currency for importers for production. A part of the few that Cuban banks can offer can be allocated to companies that need to import merchandise to produce industrial goods or goods with economic impact.
- Importing clusters of MSMEs to reduce import costs and reduce sales prices. MINCEX and MINCIN can act as facilitators due to their institutional role and the possibility of establishing incentives. Integration with special areas such as Mariel, or others that may arise in the future, is strategic. Foreigners do not have to be the only investors in key areas of the Cuban economy. Furthermore, territorially, provincial or municipal governments can organize their own clusters.
- Monitoring and evaluation systems. The number of economic actors involved in the commercial sector, the volume of operations, the impact on increasing supply or decreasing prices can be measured.
In conclusion, the Government has resolved the contradictions of wholesale trade in a solution that maintains restrictions, but not as extreme as the original provisions of Resolution 56.
The new rules maintain the commercial sector private closed and highly concentrated. However, a policy that has taken so many turns of the helm could still have surprises in store for us.
