Sources: Star Cuban prospect Yoan Moncada’s free agency imminent

Star Cuban prospect Yoan Moncada no longer needs a specific unblocking license to play baseball in the United States, paving the way for Major League Baseball teams to pursue him with a contract most expect to shatter bonus records, government and major league sources told Yahoo Sports.

Recent changes by the Obama administration allow native Cubans who can prove permanent residence in a third country to receive a general unblocking license and avoid the sometimes-arduous application process for an Office of Foreign Asset Controls specific license, which was previously needed to do business in the U.S. Moncada, who left Cuba for Guatemala in August, has a permanent residency document, a Guatemalan National Identity Card and a statement from a Guatemala-based bank as proof of residency, sources familiar with his case told Yahoo Sports.

Any person who meets the requirements for a general unblocking license no longer will be issued a specific unblocking license, a Treasury Department official told Yahoo Sports, putting the onus on MLB to verify Moncada’s residency and allow teams to begin negotiating contracts with him. Moncada had been waiting for a specific license from OFAC since late September, sources said, the only holdup in an expected bidding war for his services.

MLB was drafting a letter to OFAC on Tuesday asking for a meeting in the near future to clarify the new regulations and potentially change league policy, which requires a specific unblocking license. Should a meeting take place soon, one league official estimated Moncada could be free to negotiate with teams within two weeks.

“If OFAC confirms that the process for unblocking Cuban players is no longer to apply for a specific license,” the official said, “MLB will conform to the law.”

Baseball’s fear of immediately declaring Moncada a free agent stems from past residency issues with Cuban players, including concerns about false documents and bribes to expedite the documentation process, sources said. Were the league to run afoul of Cuban Assets Control Regulations, issued under the Trading With the Enemy Act, it could be subject to penalties that include $1 million in corporate fines, $250,000 in individual fines and up to 10 years in prison.

With the onus now on the league to verify residency documents – a fairly complicated process with residency rules differing from country to country and potentially tens of millions of dollars at stake with the verification – it is seeking some sort of assurance that a good-faith effort in due diligence would shield it from potential legal issues should a player later be found to have falsified residency documents.

In a statement provided to Yahoo Sports, the league said: “MLB has important questions regarding how the new regulations apply to the unique circumstances of Cuban players based on our significant experience in this area, and our discussions with OFAC in prior years. MLB is committed to following the laws of the United States, and will not change its policy requiring that Cuban Players receive a specific OFAC unblocking license until it confirms with all relevant branches of our government, including OFAC, that any new approach is consistent with the law. We hope to receive clarity on this issue as quickly as possible.”

Most top Cuban players end up in third countries because major league rules specify those who take up residency in the United States are automatically entered into the amateur draft, where signing bonuses are significantly lower. The league sought to restrict the market on Cubans, too, by declaring those under 23 years old and without significant professional experience would not be granted full free agency but signed under the rules of a capped international bonus pool.

Moncada, 19, is about to take a sledgehammer to the idea it would restrict spending. He is perhaps the most desired player to leave Cuba ever, the hype surrounding him exceeding that of even Yasiel Puig, Jose Abreu, Aroldis Chapman and Yoenis Cespedes, who arrived and starred in the major leagues almost immediately. A switch-hitting infielder who could end up at second base, shortstop or third base, Moncada’s signing bonus should exceed $30 million and could go much higher, particularly considering the interested parties.

The New York Yankees, Boston Red Sox, Los Angeles Dodgers and Chicago Cubs remain the favorites for Moncada, major league sources said, particularly because the team that signs him will need to pay nearly a dollar-for-dollar penalty on his bonus. For every dollar a team spends over its allotted international bonus pool between July 2, 2014, and June 15, 2015, it is taxed an equal amount.

The incentive for the Yankees and Red Sox is evident: Not only do scouts believe Moncada is a rare five-tool prospect, the AL East powers already have exceeded their bonus pools and incurred penalties that will also limit their spending in the July 2, 2015-June 15, 2016 signing period. Because the Dodgers didn’t spend aggressively early on in the current period, their involvement will depend on just how strongly they believe Moncada is a star and whether he’s worth missing the upcoming class of top international players.

The Cubs and Texas Rangers are in an entirely different place: Because they spent big internationally two years ago, they are not eligible to sign a high-priced international free agent until July 2. Moncada, sources said, remains open to waiting until July 2 for one of the teams not allowed to sign him until then.

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