Commerce Committees Move Encryption Bills

The House and Senate Commerce Committees moved in perfect harmony this week, passing companion bills to allow digitally encrypted information to be exported. If they become law, the measures would open America’s doors to increased electronic commerce in world markets.

Both bills would allow the Secretary of Commerce to deny the export of encryption products to specific groups and organizations if it would be used to harm national security, used to exploit children or used for illegal Activities. Beyond that provision, though, the bills are not identical. A compromise bill incorporating some or all of each bill’s provisions will have to be written if each bill passes its own chamber as currently written.

Bliley Pushes House Bill

House bill H.R.850, the Security and Freedom through Encryption Act, was introduced by Rep. Bob Goodlatte (R-Virginia) and shepherded through the Commerce Committee by Chairman Tom Bliley (R-Virginia). Despite the express purpose of easing export restrictions, getting an export permit will not be particularly quick or easy. The house bill requires the Secretary of Commerce to consult with the Secretaries of State and Defense, the Director of Central Intelligence and the Attorney General when reviewing of any encryption product for export. U.S. companies would be prohibited from exporting products to the People’s Liberation Army in China or the Communist China Military.

“In easing restrictions on the export of strong encryption products, we allow people to conduct safe and secure transactions on-line,” Bliley said. “This Committee has made electronic commerce a high priority because it is important for our nation’s economy.”

Bliley also used the committee vote Wednesday as an opportunity to take a shot at the Clinton administration, furthering the ongoing spat between Republicans and Democrats over international security issues. “We cannot wait for the Administration to change its encryption policy. We also know from experience, that in the end, any real progress will require Congressional action,” Bliley said.

McCain Leads Senate Action

Senate bill S.798, the Promote Reliable On-Line Transactions to Encourage Commerce and Trade Act, does not give oversight authority to the Departments of State, Defense and Justice. Introduced by Commerce Committee Chairman John McCain (R-Arizona), the bill would create an Encryption Export Advisory Board to review applications for exemption of some technologies and make recommendations to the Secretary of Commerce. The bill also directs the National Institute of Standards and Technology to establish an advanced encryption standard by Jan. 1, 2002.

The bill also does not specifically leave out Communist Chinese organizations and does not However, it does restrict exportation of non-defense encryption technology to member countries of the North Atlantic Treaty Organization, the Association of Southeast Asian Nations and the Organization for Economic Cooperation and Development.

“The bill carefully balances our national security and law enforcement interests while updating current laws on encryption technology,” McCain said. “It is illogical to deny U.S. producers the ability to compete globally if similar products are already being offered by foreign companies.”

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