harris.statement (fwd)

[Mike Godwin <mnemonic@eff.org>]

Forwarded message:
From postmaster Fri Feb  4 17:49:27 1994
Date: Fri, 4 Feb 1994 17:47:41 -0500
From: Dan Brown <brown>
Message-Id: <199402042247.RAA00197@eff.org>
To: eff-board, eff-staff
Subject: harris.statement

United States Department of State
Washington, D.C. 20520

EMBARGOED FOR RELEASE, 3:00 PM EST, FEB. 4, 1994



Statement of
Dr. Martha Harris
Deputy Assistant Secretary of State
for Political-Military Affairs
February 4, 1994


Encryption -- Export Control Reform


The Secretary of State is announcing today measures arising from 
the Administration's decision to reform export control procedures 
applicable to products incorporating encryption technology. These 
reforms are part of the Administration's effort to eliminate 
unnecessary controls and ensure efficient implementation. The 
reforms will simplify encryption product export licensing and 
speed the review of encryption product exports, thus helping U.S. 
manufacturers to compete more effectively in the global market. 
While there will be no changes in the types of equipment 
controlled by the Munitions List, we are announcing measures to 
expedite licensing.

Last year the President announced an initiative to encourage U.S. 
manufacturers and users of encryption to take advantage of a 
government technology (the key-escrow chip) that provides 
excellent security while ensuring that the Government has a means 
to decode the encryption when lawfully authorized, such as when 
executing a court-authorized warrant in connection with a criminal 
investigation. At the time he announced this initiative, the 
President directed a comprehensive review of U.S. policy regarding 
domestic use and export of encryption technology. The reforms we 
are announcing today result from that review.

The President has determined that vital U.S. national security and 
law enforcement interests compel maintaining appropriate control 
of encryption. Still, there is much that can be done to reform 
existing controls to ensure that they are efficiently implemented 
and to maintain U.S. leadership in the world market for encryption 
technology. Accordingly, the President has asked the Secretary of 
State to take immediate action to implement a number of procedural 
reforms. The reforms are:

* License Reform: Under new licensing arrangements, encryption 
manufacturers will be able to ship their products from the United 
States directly to customers within approved regions without 
obtaining individual licenses for each end user. This will improve 
the ability of our manufacturers to provide expedited delivery of 
products, and to reduce shipping and tracking costs. It should 
also reduce the number of individual license requests, especially 
for small businesses that cannot afford international 
distributors.

* Rapid review of export license applications: A significant 
number of encryption export license applications can be reviewed 
more quickly. For such exports, we have set a license turnaround 
goal of two working days.

* Personal use exemption: We will no longer require that U.S. 
citizens obtain an export license prior to taking encryption 
products out of the U.S. temporarily for their own personal use. 
In the past, this requirement caused delays and inconvenience for 
business travellers.

* Allow exports of key-escrow encryption: After initial review, 
key-escrow encryption products may now be exported to most end 
users. Additionally, key-escrow products will qualify for special 
licensing arrangements.

These reforms should have the effect of minimizing the impact of 
export controls on U.S. industry. The Department of State will 
take all appropriate actions to ensure that these reforms are 
implemented as quickly as possible. The Secretary of State asks 
that encryption product manufacturers evaluate the impact of these 
reforms over the next year and provide feedback both on how the 
reforms have worked out and on recommendations for additional 
procedural reforms.

The contact point for further information on these reforms is Rose 
Biancaniello, Office of Defense Trade Controls, Bureau of 
Political-Military Affairs, Department of State, (703) 875-6644.