FOR IMMEDIATE RELEASE:
CONTACTS: Mary Hanley
July 7, 1998 (202) 482-4883 Susan Hofer
SECRETARY DALEY ANNOUNCES NEW EXPORT GUIDELINES
FOR FINANCIAL SERVICE ENCRYPTION PRODUCTS
WASHINGTON -- Commerce Secretary William Daley announced today that the Clinton Administration has finalized guidelines to allow the export of U.S. manufactured encryption products of any bit-length when used by banks, financial institutions and their branches around the world to secure private electronic transactions. Strong encryption products -- with or without recovery features -- will be exportable to eligible institutions without a license, after a one-time review, to banks and financial institutions in 45 countries. Eligible institutions include banks, security firms, brokers and credit card companies.
These new guidelines will affect encryption exports for almost 70 percent of the world=s financial institutions and the world=s 100 largest banks. Today=s announcement follows last year=s decision to allow special treatment of encryption products used to secure financial communications and transactions.
AThis action gives our nation=s financial institutions the flexibility they need to remain globally competitive. Importantly, it balances those needs with law enforcement, national security and foreign policy concerns. Through steps like this we can continue to encourage the development of an electronic commerce system users can trust,@ said Secretary William M. Daley in a speech to exporters at the Commerce Department=s Bureau of Export Administration=s annual Update Conference.
The 45 eligible countries are either members of the international anti-money laundering accord, the Financial Action Task Force, or have enacted anti-money laundering laws. The list of currently eligible countries is attached. Manufacturers and other exporters will be able to ship the products to these countries with only minimum reporting requirements. Products which have already been reviewed can be shipped to financial institutions of eligible countries under license exception without further review.
Exports to banks and financial institutions in countries which are not eligible for license exception will continue to require approval under either export licensing arrangements or individual licenses. Applications for such licenses arrangements will be reviewed by agencies with a presumption of approval unless agencies raise specific concerns about a country or financial end user regarding participation in money laundering, narcotics trafficking or similar concerns.