The administration has discretion to decide whether the Cuban Baseball Federation is too closely aligned with that country's sports ministry to allow independent agreements involving players. The Trump administration has worked to pull back from the closer ties to Cuba that were established during President Obama's tenure.
"Major League Baseball has been informed of the dangers of dealing with Cuba," the senior administration official said.
The move comes just months after MLB and the Cuban Baseball Federation reached a deal at the end of 2018 to facilitate Cuban baseball players joining U.S. teams without having to defect, as had been the case in years past.
The U.S. economic embargo on Cuba prohibits Americans from doing business with the Cuban government, so the MLB deal relied on a ruling issued during the Obama administration that held that the Cuban Baseball Federation is not run by the government on the communist-run island.
Now the Trump administration is undoing that ruling, meaning that any agreements for Cubans to play on U.S. teams will require specific licenses from the Treasury Department exempting them from the prohibition. It's likely the Trump administration would move quickly to grant those licenses.