     12-24-96. Communications Daily:

     New encryption export rules probably won't be issued until early
     next week

     New encryption export rules probably won't be issued until early
     next week, just day or 2 before they go into effect on Jan. 1,
     govt. officials said Mon. Administration is revising rules after
     taking informal comments from industry.

     Greg Simon, chief domestic policy staffer for Vice President Gore,
     said section of rules requiring detailed business plans from
     encryption companies is likely to be changed, move that "has been
     in the works for a long time."

     Other industry observers said there's increased pressure
     for Administration to change its encryption strategy because
     export controls were ruled unconstitutional last week. Harris
     Miller, pres. of Information Technology Assn. of America
     (ITAA), wrote Dec. 22 to President Clinton asking for changes
     in draft rules Administration issued earlier this month, objecting
     also to business plan requirement.

     Meanwhile, Organization for Economic Cooperation & Development
     (OECD) released set of guidelines for encryption policy that
     concluded development of encryption methods should be market-driven.
     Group of ad hoc experts has met several times this year to create
     international guidelines for encryption.

     Draft -- which won't be released in full form until March -- says
     countries may allow law enforcement officers to access encrypted
     data (wiretapping) but recommendations don't "encourage" it, OECD
     official said.

     He said other principles in draft include that:

       (1) Encryption should be trustworthy.
       (2) User should have choice of methods.
       (3) Standards should be developed nationally and internationally.
       (4) Protection of privacy and password data should be assured.
       (5) Liability should be stated clearly.
       (6) International cooperation should be continued.

     Draft is expected to become formal OECD guideline in spring, it
     said.

     Industry observers said U.S. govt. at first said it would work with
     private industry on encryption rules acceptable to all, but then
     tried through drafting sessions to increase emphasis on govt.
     positions.

     [For the OECD draft, Euro crypto and commentary see:

       http://www.quintessenz.at/Netzteil/OECD/index.html
       http://www.ozemail.com.au/~firstpr/crypto/
       http://www.modeemi.cs.tut.fi/~avs/eu-crypto.html
       http://www.eff.org/~declan/global/japan/rotenberg.reply.102896

     Thanks to Robin Whittle for the URLs.]

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     12-26-96. Nikkei English News:

     OECD to back police authority to decode e-money transactions

     Paris -- The Organization for Economic Cooperation and Development
     will not object to member nations giving their police the right to
     decipher codes used in electronic money transactions. The
     organization of industrial countries has mapped out an eight-point
     guideline on standardizing coding technology, crucial to the safe
     and widespread use of e-money. It has called on members to
     cooperate in the process.

     The OECD also warned that e-money is open to crime risks.

     The guideline, to be announced by spring, also urges members to
     adopt domestic laws supporting code standardization. Nevertheless,
     heavy debate is expected over the question of decoding rights for
     police, because of privacy issues.

     The U.S. has already decided to allow authorities to read e-money
     codes from January, and is expected to call on Japan and other
     countries to follow suit to help prevent international crimes.

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