Companies Applaud Encryption Export

FRAMINGHAM (07/21/2000) - White House Chief of Staff John Podesta announced this week that the Clinton administration is lifting restrictions on exports of software with strong encryption to certain countries. Current regulations require a U.S. company wishing to export such software to obtain a license and to allow a technical review of the software.

Podesta said unregulated sales would be permitted to the 15 countries of the European Union as well as Australia, Norway, Hungary, Poland, Japan, New Zealand, Switzerland and the Czech Republic. Sales to other nations will still be subject to licensing and inspection by the U.S. Department of Commerce's Office of Strategic Trade.

Export restrictions are supported by law enforcement agencies concerned about the use of strong encryption by terrorists and hostile governments. But U.S. software companies have pressed hard to overturn the regulations, which they say put them at a competitive disadvantage.

Many large U.S. financial companies have already been granted exemptions from the export laws and are allowed to use strong encryption products overseas.

Stewart Noyce, vice president of marketing at Certicom Corp., an encryption technology provider in Hayward, Calif., said easing of the restrictions will streamline business processes and eliminate the need for costly legal counsel to review export requirements.

Certicom customer Qualcomm Inc. in San Diego, said lifting export restrictions will benefit both its bottom line and end users. "It will create a better environment for e-commerce, and people will feel more comfortable processing transactions online," said Dave Ross, director of product management for Qualcomm's Eudora e-mail clients.

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