From: Martin Minow <minow@apple.com>
Date: Sat, 16 Nov 1996 09:11:58 -0800 (PST)
To: cypherpunks@toad.com
Subject: Re: Clipper 3.11 executive order
In-Reply-To: <Pine.SUN.3.95.961115171049.27778D-100000@viper.law.miami.edu>
Message-ID: <v03007802aeb3a1bae4a1@[17.219.103.51]>
MIME-Version: 1.0
Content-Type: text/plain


-----BEGIN PGP SIGNED MESSAGE-----BY SAFEMAIL-----

In a message to Cypherpunks, Professor Froomkin referenced a presidential
press release concerning Clipper.
  http://library.whitehouse.gov/PressReleases.cgi?date=0&briefing=4

Note that this URL will give you today's briefing. To find the
original, you'll have to scan back through the website to find
November 15th, or you can read the rest of this long message.

Martin Minow
minow@apple.com

                           THE WHITE HOUSE

                    Office of the Press Secretary

  _______________________________________________________________

  For Immediate Release                         November 15, 1996



                        TEXT OF A LETTER FROM
                   THE PRESIDENT TO THE SPEAKER OF
                   THE HOUSE OF REPRESENTATIVES AND
                     THE PRESIDENT OF THE SENATE


                          November 15, 1996



  Dear Mr. Speaker:     (Dear Mr. President:)

  In order to take additional steps with respect to the
  national emergency described and declared in Executive
  Order 12924 of August 19, 1994, and continued on August 15,
  1995, and August 14, 1996, necessitated by the expiration of
  the Export Administration Act (EAA) on August 20, 1994, I hereby
  report to the Congress that pursuant to section 204(b) of the
  International Emergency Economic Powers Act, 50 U.S.C. 1703(b)
  (the "Act"), I have today exercised the authority granted by the
  Act to issue an Executive order (a copy of which is attached) to
  revise the provisions that apply to the administration of the
  export control system maintained by Department of Commerce in
  the Export Administration Regulations, 15 CFR Part 730 et seq.

  The new Executive order relates to my decision to transfer
  certain encryption products from the United States Munitions
  List administered by the Department of State to the Commerce
  Control List administered by the Department of Commerce.
  When I made that decision I also decided to amend Executive
  Order 12981 of December 5, 1995, which sets forth procedures
  for the interagency review and disposition of dual-use export
  license applications, to include the Department of Justice
  among the agencies that have the opportunity to review such
  applications with respect to encryption products transferred
  to Department of Commerce control.

  Also, in issuing the new order, I provided for appropriate
  controls on the export and foreign dissemination of encryption
  products transferred to the Department of Commerce.  Among
  other provisions, I determined that the export of encryption
  products transferred to Department of Commerce control could
  harm national security and foreign policy interests of the
  United States even where comparable products are or appear to
  be available from foreign sources.  Accordingly, the new order
  makes clear that any EAA provision dealing with issuance of
  licenses or removal of controls based on foreign availability
  considerations shall not apply with respect to export controls
  on such encryption products.  Notwithstanding this, the
  Secretary of Commerce retains the discretion to consider the
  foreign availability of comparable encryption products in any
  particular case.

                                Sincerely,


                                WILLIAM J. CLINTON


                               #  #  #

                           THE WHITE HOUSE

                    Office of the Press Secretary

  _______________________________________________________________

  For Immediate Release                         November 15, 1996



                          November 15, 1996



  MEMORANDUM FOR THE VICE PRESIDENT
                 THE SECRETARY OF STATE
                 THE SECRETARY OF THE TREASURY
                 THE SECRETARY OF DEFENSE
                 THE ATTORNEY GENERAL
                 THE SECRETARY OF COMMERCE
                 UNITED STATES TRADE REPRESENTATIVE
                 DIRECTOR OF THE OFFICE OF MANAGEMENT AND BUDGET
                 CHIEF OF STAFF TO THE PRESIDENT
                 DIRECTOR OF CENTRAL INTELLIGENCE
                 DIRECTOR, FEDERAL BUREAU OF INVESTIGATION
                 DIRECTOR, NATIONAL SECURITY AGENCY
                 ASSISTANT TO THE PRESIDENT FOR NATIONAL
                    SECURITY AFFAIRS
                 ASSISTANT TO THE PRESIDENT FOR ECONOMIC POLICY
                 ASSISTANT TO THE PRESIDENT FOR SCIENCE AND
                    TECHNOLOGY POLICY

  SUBJECT:       Encryption Export Policy


  Encryption products, when used outside the United States, can
  jeopardize our foreign policy and national security interests.
  Moreover, such products, when used by international criminal
  organizations, can threaten the safety of U.S. citizens here
  and abroad, as well as the safety of the citizens of other
  countries.  The exportation of encryption products accordingly
  must be controlled to further U.S. foreign policy objectives,
  and promote our national security, including the protection of
  the safety of U.S. citizens abroad.  Nonetheless, because of
  the increasingly widespread use of encryption products for the
  legitimate protection of the privacy of data and communications
  in nonmilitary contexts; because of the importance to U.S.
  economic interests of the market for encryption products;
  and because, pursuant to the terms set forth in the Executive
  order entitled Administration of Export Controls on Encryption
  Products (the "new Executive order") of November 15, 1996,
  Commerce Department controls of the export of such dual-use
  encryption products can be accomplished without compromising
  U.S. foreign policy objectives and national security interests,
  I have determined at this time not to continue to designate such
  encryption products as defense articles on the United States
  Munitions List.

  Accordingly, under the powers vested in me by the Constitution
  and the laws of the United States, I direct that:

  1.  Encryption products that presently are or would be
  designated in Category XIII of the United States Munitions
  List and regulated by the Department of State pursuant to
  the Arms Export Control Act (22 U.S.C. 2778 et seq.) shall
  be transferred to the Commerce Control List, and regulated
  by the Department of Commerce under the authority conferred

                                 more

                                                    (OVER)

                                  2

  in Executive Order 12924 of August 19, 1994 (as continued on
  August 15, 1995, and August 14, 1996), Executive Order 12981
  of December 5, 1995, and the new Executive order except
  that encryption products specifically designed, developed,
  configured, adapted, or modified for military applications
  (including command, control, and intelligence applications),
  shall continue to be designated as defense articles, shall
  remain on the United States Munitions List, and shall continue
  to be controlled under the Arms Export Control Act.  The
  transfer described in this paragraph shall be effective upon
  the issuance of final regulations (the "Final Regulations")
  implementing the safeguards specified in this directive and
  in the new Executive order.

  2.  The Final Regulations shall specify that the encryption
  products specified in section 1 of this memorandum shall be
  placed on the Commerce Control List administered by the
  Department of Commerce.  The Department of Commerce shall,
  to the extent permitted by law, administer the export of such
  encryption products, including encryption software, pursuant
  to the requirements of sections 5 and 6 of the former Export
  Administration Act (50 U.S.C. App. 2405 and 2406), and the
  regulations thereunder, as continued in effect by Executive
  Order 12924 of August 19, 1994 (continued on August 15, 1995,
  and on August 14, 1996), except as otherwise indicated in or
  modified by the new Executive order, Executive Order 12981 of
  December 5, 1995, and any Executive orders and laws cited
  therein.

  3.  The Final Regulations shall provide that encryption
  products described in section 1 of this memorandum can be
  licensed for export only if the requirements of the controls
  of both sections 5 and 6 of the former Export Administration
  Act (50 U.S.C. App. 2405 and 2406), and the regulations
  thereunder, as modified by the new Executive order, Executive
  Order 12981 of December 5, 1995, and any Executive orders
  and laws cited therein, are satisfied.  Consistent with
  section 742.1(f) of the current Export Administration
  Regulations, the Final Regulations shall ensure that a license
  for such a product will be issued only if an application can
  be and is approved under both section 5 and section 6.  The
  controls on such products will apply to all destinations.
  Except for those products transferred to the Commerce Control
  List prior to the effective date of the Final Regulations,
  exports and reexports of encryption products shall initially be
  subject to case-by-case review to ensure that export thereof
  would be consistent with U.S. foreign policy objectives and
  national security interests, including the safety of U.S.
  citizens.  Consideration shall be given to more liberalized
  licensing treatment of each such individual product after
  interagency review is completed.  The Final Regulations shall
  also effectuate all other specific objectives and directives set
  forth in this directive.

  4.  Because encryption source code can easily and mechanically
  be transformed into object code, and because export of such
  source code is controlled because of the code's functional
  capacity, rather than because of any "information" such code
  might convey, the Final Regulations shall specify that
  encryption source code shall be treated as an encryption
  product, and not as technical data or technology, for export
  licensing purposes.

  5.  All provisions in the Final Regulations regarding
  "de minimis" domestic content of items shall not apply with
  respect to the encryption products described in paragraph 1
  of this memorandum.

                                 more

                                  3

  6.  The Final Regulations shall, in a manner consistent with
  section 16(5)(C) of the EAA, 50 U.S.C. App. 2415(5)(C), provide
  that it will constitute an export of encryption source code
  or object code software for a person to make such software
  available for transfer outside the United States, over radio,
  electromagnetic, photooptical, or photoelectric communications
  facilities accessible to persons outside the United States,
  including transfer from electronic bulletin boards and Internet
  file transfer protocol sites, unless the party making the
  software available takes precautions adequate to prevent the
  unauthorized transfer of such code outside the United States.

  7.  Until the Final Regulations are issued, the Department of
  State shall continue to have authority to administer the export
  of encryption products described in section 1 of this memorandum
  as defense articles designated in Category XIII of the United
  States Munitions List, pursuant to the Arms Export Control Act.

  8.  Upon enactment of any legislation reauthorizing the
  administration of export controls, the Secretary of Defense,
  the Secretary of State, and the Attorney General shall reexamine
  whether adequate controls on encryption products can be
  maintained under the provisions of the new statute and advise
  the Secretary of Commerce of their conclusions as well as any
  recommendations for action.  If adequate controls on encryption
  products cannot be maintained under a new statute, then such
  products shall, where consistent with law, be designated or
  redesignated as defense articles under 22 U.S.C. 2778(a)(1),
  to be placed on the United States Munitions List and controlled
  pursuant to the terms of the Arms Export Control Act and the
  International Traffic in Arms Regulations.  Any disputes
  regarding the decision to designate or redesignate shall be
  resolved by the President.



                                     WILLIAM J. CLINTON



                                # # #

                           THE WHITE HOUSE

                    Office of the Press Secretary

  _______________________________________________________________

  For Immediate Release                         November 15, 1996


                           EXECUTIVE ORDER

                            - - - - - - -

       ADMINISTRATION OF EXPORT CONTROLS ON ENCRYPTION PRODUCTS


       By the authority vested in me as President by the
  Constitution and the laws of the United States of America,
  including but not limited to the International Emergency
  Economic Powers Act (50 U.S.C. 1701 et seq.), and in order to
  take additional steps with respect to the national emergency
  described and declared in Executive Order 12924 of August 19,
  1994, and continued on August 15, 1995, and on August 14, 1996,
  I, WILLIAM J. CLINTON, President of the United States of
  America, have decided that the provisions set forth below shall
  apply to administration of the export control system maintained
  by the Export Administration Regulations, 15 CFR Part 730
  et seq. ("the EAR").  Accordingly, it is hereby ordered as
  follows:

       Section 1.  Treatment of Encryption Products.  In order
  to provide for appropriate controls on the export and foreign
  dissemination of encryption products, export controls of
  encryption products that are or would be, on this date,
  designated as defense articles in Category XIII of the
  United States Munitions List and regulated by the United States
  Department of State pursuant to the Arms Export Control Act,
  22 U.S.C. 2778 et seq. ("the AECA"), but that subsequently are
  placed on the Commerce Control List in the EAR, shall be subject
  to the following conditions:  (a)  I have determined that the
  export of encryption products described in this section could
  harm national security and foreign policy interests even where
  comparable products are or appear to be available from sources
  outside the United States, and that facts and questions
  concerning the foreign availability of such encryption products
  cannot be made subject to public disclosure or judicial review
  without revealing or implicating classified information that
  could harm United States national security and foreign policy
  interests.  Accordingly, sections 4(c) and 6(h)(2)-(4) of
  the Export Administration Act of 1979 ("the EAA"), 50 U.S.C.
  App. 2403(c) and 2405(h)(2)-(4), as amended and as continued
  in effect by Executive Order 12924 of August 19, 1994, and
  by notices of August 15, 1995, and August 14, 1996, all
  other analogous provisions of the EAA relating to foreign
  availability, and the regulations in the EAR relating to such
  EAA provisions, shall not be applicable with respect to export
  controls on such encryption products.  Notwithstanding this,
  the Secretary of Commerce ("Secretary") may, in his discretion,
  consider the foreign availability of comparable encryption
  products in determining whether to issue a license in a
  particular case or to remove controls on particular products,
  but is not required to issue licenses in particular cases or
  to remove controls on particular products based on such
  consideration;

       (b)  Executive Order 12981, as amended by Executive
  Order 13020 of October 12, 1996, is further amended as follows:

       (1)  A new section 6 is added to read as follows:
  "Sec. 6.  Encryption Products.  In conducting the license
  review described in section 1 above, with respect to export
  controls of encryption products that are or would be, on
  November 15, 1996, designated as defense articles in Category


                                 more

                                                    (OVER)

                                  2

  XIII of the United States Munitions List and regulated by the
  United States Department of State pursuant to the Arms Export
  Control Act, 22 U.S.C. 2778 et seq., but that subsequently are
  placed on the Commerce Control List in the Export Administration
  Regulations, the Departments of State, Defense, Energy, and
  Justice and the Arms Control and Disarmament Agency shall have
  the opportunity to review any export license application
  submitted to the Department of Commerce.  The Department of
  Justice shall, with respect to such encryption products, be a
  voting member of the Export Administration Review Board
  described in section 5(a)(1) of this order and of the Advisory
  Committee on Export Policy described in section 5(a)(2) of this
  order.  The Department of Justice shall be a full member of the
  Operating Committee of the ACEP described in section 5(a)(3) of
  this order, and of any other committees and consultation groups
  reviewing export controls with respect to such encryption
  products."

       (2)  Sections 6 and 7 of Executive Order 12981 of
  December 5, 1995, are renumbered as new sections 7 and 8,
  respectively.

       (c)  Because the export of encryption software, like the
  export of other encryption products described in this section,
  must be controlled because of such software's functional
  capacity, rather than because of any possible informational
  value of such software, such software shall not be considered
  or treated as "technology," as that term is defined in
  section 16 of the EAA (50 U.S.C. App. 2415) and in the EAR
  (61 Fed. Reg. 12714, March 25, 1996);

       (d)  With respect to encryption products described in this
  section, the Secretary shall take such actions, including the
  promulgation of rules, regulations, and amendments thereto, as
  may be necessary to control the export of assistance (including
  training) to foreign persons in the same manner and to the same
  extent as the export of such assistance is controlled under the
  AECA, as amended by section 151 of Public Law 104-164;

       (e)  Appropriate controls on the export and foreign
  dissemination of encryption products described in this section
  may include, but are not limited to, measures that promote the
  use of strong encryption products and the development of a key
  recovery management infrastructure; and

       (f)  Regulation of encryption products described in this
  section shall be subject to such further conditions as the
  President may direct.

       Sec. 2.  Effective Date.  The provisions described in
  section 1 shall take effect as soon as any encryption products
  described in section 1 are placed on the Commerce Control List
  in the EAR.

       Sec. 3.  Judicial Review.  This order is intended only to
  improve the internal management of the executive branch and to
  ensure the implementation of appropriate controls on the export
  and foreign dissemination of encryption products.  It is not
  intended to, and does not, create any rights to administrative
  or judicial review, or any other right or benefit or trust
  responsibility, substantive or procedural, enforceable
  by a party against the United States, its agencies or
  instrumentalities, its officers or employees, or any other
  person.



                                WILLIAM J. CLINTON

  THE WHITE HOUSE,
      November 15, 1996.


-----BEGIN PGP SIGNATURE-----BY SAFEMAIL-----
Version: 1.0b4 e22

iQCVAwUBMo3yMW23+ciinrc5AQGThQQAwBOZ9AV6IB+0lp2VHs6h+AAkb/XOiTsj
PpzXuD7TwWItvNErM1nV1f7KP5X7uzhLdAwZZVdBeOrKzzqm2WtvMCFBBjrStpDp
M71ckQTU+CPsACj55VVN5Vo4puMheiiWVodYQbr0RvV8L/u/3+89K6HL21zK4lmk
znvyInZUJKo=
=IFje
-----END PGP SIGNATURE-----