SCIENTIFIC AND TECHNOLOGICAL OPTIONS ASSESSMENT
STOA
DEVELOPMENT OF SURVEILLANCE TECHNOLOGY AND RISK OF ABUSE OF ECONOMIC INFORMATION
Vol 5/5
The perception of economic risks arising from the potential vulnerability of electronic commercial media to interception
Working document for the STOA Panel
Luxembourg, October 1999 PE 168.184/Vol 5/5
From 1994 onwards, Washington began to woo private companies to develop an encryption system that would provide access to keys by government agencies. Under the proposals - variously known as `key escrow', `key recovery' or `trusted third parties' - the keys would be held by a corporation, not a government agency, and would be designed by the private sector, not the NSA. The systems, however, still entailed the assumption of guaranteed access to the intelligence community and so proved as controversial as the Clipper Chip. The government used export incentives to encourage companies to adopt key escrow products: they could export stronger encryption, but only if they ensured that intelligence agencies had access to the keys.
Under US law, computer software and hardware cannot be exported if it contains encryption that the NSA cannot break. The regulations stymie the availability of encryption in the USA because companies are reluctant to develop two separate product lines - one, with strong encryption, for domestic use and another, with weak encryption, for the international market. Several cases are pending in the US courts on the constitutionality of export controls; a federal court recently ruled that they violate free speech rights under the First Amendment.
The FBI has not let up on efforts to ban products on which it cannot eavesdrop. In mid-1997, it introduced legislation to mandate that key-recovery systems be built into all computer systems. The amendment was adopted by several congressional Committees but the Senate preferred a weaker variant. A concerted campaign by computer, telephone and privacy groups finally stopped the proposal; it now appears that no legislation will be enacted in the current Congress.
While the key escrow approach was being pushed in the USA, Washington had approached foreign organisations and states. The lynchpin for the campaign was David Aaron, US ambassador to the Organisation for Economic Co-operation and Development (OECD), who visited dozens of countries in what one analyst derided as a programme of `laundering failed US policy through international bodies to give it greater acceptance'.
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