Cam OB3 is the only defined OB association believed to belong to the Outer Galactic Arm or Cygnus Arm. Very few members have been observed and the distance modulus to the association is not well known. We attempt a more complete description of the population of Cam OB3 and a better determination of its distance modulus. We present uvby photometry of the area surrounding the O-type stars BD +56 864 and LS I +57 138, finding a clear sequence of early-type stars that define an uncatalogued open cluster, which we call Alicante 1. We also present spectroscopy of stars in this cluster and the surrounding association. From the spectral types for 18 very likely members of the association and UBV photometry found in the literature, we derive individual reddenings, finding a extinction law close to standard and an average distance modulus DM=13.0+-0.4. This value is in excellent agreement with the distance modulus to the new cluster Alicante 1 found by fitting the photometric sequence to the ZAMS. In spite of the presence of several O-type stars, Alicante 1 is a very sparsely populated open cluster, with an almost total absence of early B-type stars. Our results definitely confirm Cam OB3 to be located on the Cygnus Arm and identify the first open cluster known to belong to the association.