Union Calendar No. 160
105TH CONGRESS
1ST SESSION
H. R. 695
[Report No. 105–108, Parts I, II, III, IV, V]
A BILL
To amend title 18, United States Code, to affirm
the rights of United States persons to use and
sell encryption and to relax export controls on
encryption.
SEPTEMBER 29, 1997
Reported from the Committee on Commerce with an
amendment, committed to the Committee of the Whole
House on the State of the Union, and ordered to be
printed
IB
Union Calendar No. 160
105TH CONGRESS
1ST SESSION
H. R. 695
[Report No. 105–108, Parts I, II, III, IV, V]
To amend title 18, United States Code, to affirm the rights of United
States persons to use and sell encryption and to relax export controls
on encryption.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 12, 1997
Mr. GOODLATTE (for himself, Ms. LOFGREN, Mr. DELAY, Mr. BOEHNER, Mr.
COBLE, Mr. SENSENBRENNER, Mr. BONO, Mr. PEASE, Mr. CANNON, Mr.
CONYERS, Mr. BOUCHER, Mr. GEKAS, Mr. SMITH of Texas, Mr. INGLIS
of South Carolina, Mr. BRYANT, Mr. CHABOT, Mr. BARR of Georgia, Ms.
JACKSON-LEE of Texas, Ms. WATERS, Mr. ACKERMAN, Mr. BAKER, Mr.
BARTLETT
of Maryland, Mr. CAMPBELL, Mr. CHAMBLISS, Mr.
CUNNINGHAM, Mr. DAVIS of Virginia, Mr. DICKEY, Mr. DOOLITTLE, Mr.
EHLERS, Mr. ENGEL, Ms. ESHOO, Mr. EVERETT, Mr. EWING, Mr. FARR
of California, Mr. GEJDENSON, Mr. GILLMOR, Mr. GOODE, Ms. NORTON,
Mr. HORN, Ms. EDDIE BERNICE JOHNSON of Texas, Mr. SAM JOHNSON
of Texas, Mr. KOLBE, Mr. MCINTOSH, Mr. MCKEON, Mr. MANZULLO,
Mr. MATSUI, Mr. MICA, Mr. MINGE, Mr. MOAKLEY, Mr. NETHERCUTT,
Mr. PACKARD, Mr. SESSIONS, Mr. UPTON, Mr. WHITE, and Ms. WOOL-
SEY) introduced the following bill; which was referred to the Committee
on the Judiciary, and in addition to the Committee on International Rela-
tions, for a period to be subsequently determined by the Speaker, in each
case for consideration of such provisions as fall within the jurisdiction of
the committee concerned
MAY 22, 1997
Reported from the Committee on the Judiciary with an amendment
[Strike out all after the enacting clause and insert the part printed in italic]
Referral to the Committee on International Relations extended for a period
ending not later than July 11, 1997
•H.R. 695 RH
JUNE 26, 1997
Referral to the Committee on International Relations extended for a period
ending not later than July 25, 1997
Referred to the Committees on Commerce, National Security, and the Perma-
nent Select Committee on Intelligence for a period ending not later than
September 5, 1997, for consideration of such provisions of the bill and
amendment reported by the Committee on the Judiciary as fall within the
jurisdiction of those committees pursuant to clause 1(e) and (k), rule X
and rule XLVIII, respectively
JULY 25, 1997
Reported from the Committee on the International Relations with an
amendment
[Strike out all after the enacting clause and insert the part printed in boldface roman]
JULY 30, 1997
Referral to the Permanent Select Committee on Intelligence extended for a
period ending not later than September 12, 1997
JULY 31, 1997
Referral to the Committee on National Security extended for a period ending
not later than September 12, 1997
SEPTEMBER 5, 1997
Referral to the Committee on Commerce extended for a period ending not
later than September 12, 1997
SEPTEMBER 11, 1997
Referral to the Permanent Select Committee on Intelligence extended for a
period ending not later than September 16, 1997
Referral to the Committee on Commerce extended for a period ending not
later than September 26, 1997
SEPTEMBER 12, 1997
Reported from the Committee on the National Security with amendments
[Omit the part struck through in bold brackets and insert the part printed in boldface italic
and amend the title]
SEPTEMBER 16, 1997
Reported from the Permanent Select Committee on Intelligence with an
amendment
[Strike out all after the enacting clause and insert the part printed in boldface roman in double
bold brackets]
SEPTEMBER 25, 1997
Referral to the Committee on Commerce extended for a period ending not
later than September 29, 1997
SEPTEMBER 29, 1997
Additional sponsors: Mr. HASTINGS of Washington, Mr. COOK, Mr. FOX of
•H.R. 695 RH
Pennsylvania, Mrs. MORELLA, Mr. BILBRAY, Mrs. MYRICK, Mr.
DEFAZIO, Mr. WATKINS, Mr. FRANKS of New Jersey, Mr. MARTINEZ,
Mr. SHAYS, Mr. NADLER, Mr. HOSTETTLER, Mr. FALEOMAVAEGA, Mrs.
LINDA SMITH of Washington, Mr. PAXON, Mr. WELDON of Florida, Mr.
GORDON, Mr. HUTCHINSON, Ms. RIVERS, Mr. SNOWBARGER, Mrs.
TAUSCHER, Mr. DELAHUNT, Mr. ROHRABACHER, Mr. COOKSEY, Mr.
MORAN of Virginia, Mr. GALLEGLY, Mr. CAMP, Mr. WEXLER, Mr.
WELLER, Mr. SHERMAN, Mr. DREIER, Mr. CALVERT, Mr. CAPPS, Mr.
LINDER, Mr. MCINNIS, Mr. GRAHAM, Mr. THOMAS, Ms. MCKINNEY, Ms.
MCCARTHY of Missouri, Mr. FRANK of Massachusetts, Mr. SISISKY, Mr.
FORBES, Mr. BLUNT, Mr. ISTOOK, Mr. PICKERING, Mr. DOOLEY of Cali-
fornia, Mr. LATHAM, Mr. COX of California, Mr. ROEMER, Mr. FAZIO of
California, Mr. ADAM SMITH of Washington, Mr. KIND, Mr. BALLENGER,
Mr. NEY, Mr. SALMON, Mr. HOUGHTON, Mr. MCHUGH, Ms. FURSE, Mr.
HASTINGS of Florida, Mr. DIAZ-BALART, Mr. KING, Ms. SLAUGHTER,
Mr. FROST, Mr. BURTON of Indiana, Ms. DUNN, Ms. CHRISTIAN-GREEN,
Mr. ENGLISH of Pennsylvania, Mr. LAMPSON, Mr. BRADY, Mr. SMITH of
New Jersey, Mrs. CHENOWETH, Mr. COBURN, Mrs. CUBIN, Mr. BOB
SCHAFFER of Colorado, Mr. BARTON of Texas, Mr. LARGENT, Mr. CLEM-
ENT, Mr. HILLIARD, Mr. LUTHER, Mr. CRAPO, Mr. ROGAN, Mr. AN-
DREWS, Mr. BONILLA, Ms. ROS-LEHTINEN, Mr. GUTKNECHT, Mr.
HAYWORTH, Mr. SUNUNU, Mr. SCARBOROUGH, Mr. NEUMANN, Mr. SAN-
FORD, Mr. NORWOOD, Ms. PRYCE of Ohio, Mr. LEWIS of Kentucky, Mr.
KASICH, Mr. ARCHER, Mr. HANSEN, Mr. HERGER, Mr. RILEY, Mr.
HILL, Mr. TAUZIN, Mr. MORAN of Kansas, Mr. BURR of North Carolina,
Mr. BLUMENAUER, Mr. POMEROY, Mr. RIGGS, Mr. KINGSTON, Mr. MIL-
LER of California, Mr. DUNCAN, Mr. WHITFIELD, Mr. SMITH of Oregon,
Mr. QUINN, Mr. KENNEDY
of Massachusetts, Mrs. KELLY, Mr.
METCALF, Mr. MARKEY, Mr. NEAL of Massachusetts, Mrs. EMERSON,
Mr. CHRISTENSEN, Mr. WATTS of Oklahoma, Mr. SOUDER, Mr. POMBO,
Mr. STENHOLM, Mr. TIAHRT, Mr. MCGOVERN, Mr. PARKER, Mr. WICK-
ER, Mr. BARRETT of Nebraska, Mr. GEPHARDT, Mr. KIM, Mrs. JOHNSON
of Connecticut, Mr. LUCAS of Oklahoma, Mr. BROWN of California, Mr.
KNOLLENBERG, Mr. TALENT, Mr. TIENEY, Mr. KLUG, Mr. JENKINS, Mr.
CONDIT, Mr. HALL of Texas, Mr. BACHUS, Mr. CRANE, Mr. WAMP, Mr.
CASTLE, Mr. LAHOOD, Mr. GOODLING, Mr. SHIMKUS, Mr. SERRANO, Mr.
HOLDEN, Mr. HOBSON, Mr. RAHALL, Mr. THOMPSON, Mr. THUNE, Mr.
CLYBURN, Mr. HILLEARY, Mr. DEAL of Georgia, Mr. COLLINS, Mr. DAN
SCHAEFER of Colorado, Mr. HALL of Ohio, Mr. LIVINGSTON, Mr.
HOEKSTRA, Mr. WISE, Mr. FILNER, Mr. MCDERMOTT, Ms. SANCHEZ,
Mrs. THURMAN, Mr. TANNER, Mr. PASTOR, Ms. KAPTUR, Mr. LEWIS of
Georgia, Mr. JACKSON of Illinois, Ms. MILLENDER-MCDONALD, Mr.
CUMMINGS, Mr. JEFFERSON, Mr. FORD, Mr. BARRETT of Wisconsin, Mr.
FATTAH, Mr. BARCIA, Ms. HOOLEY of Oregon, Mrs. NORTHUP, Mr.
VENTO, Mr. BONIOR, Mrs. CLAYTON, Mrs. KENNELLY of Connecticut,
Mr. PALLONE, Mr. OLVER, Ms. KILPATRICK, Ms. DELAURO, Mrs. MEEK
of Florida, Ms. STABENOW, Mr. STEARNS, Mr. RADANOVICH, Mr. TAY-
LOR of North Carolina, Mr. WALSH, Mr. NUSSLE, Mr. DAVIS of Illinois,
and Mr. RUSH
Deleted sponsors: Mr. EVERETT (added February 12, 1997; deleted July 30,
•H.R. 695 RH
1997), Ms. EDDIE BERNICE JOHNSON of Texas (added February 12,
1997; deleted May 13, 1997), Mr. SOLOMON (added March 13, 1997; de-
leted April 29, 1997), Mr. ROTHMAN (added April 10, 1997; deleted July
24, 1997), Mr. JONES (added June 23, 1997; deleted September 8,
1997), Mr. BUNNING (added July 9, 1997; deleted July 30, 1997), Mr.
THORNBERRY (added July 24, 1997; deleted September 4, 1997), and
Mr. HEFLEY (added July 29, 1997; deleted July 30, 1997)
SEPTEMBER 29, 1997
Reported from the Committee on Commerce with an amendment, committed
to the Committee of the Whole House on the State of the Union, and
ordered to be printed
[Strike out all after the enacting clause and insert the part printed in boldface italic in bold
parentheses]
A BILL
To amend title 18, United States Code, to affirm the rights
of United States persons to use and sell encryption and
to relax export controls on encryption.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Security and Freedom
Through Encryption (SAFE) Act’’.
SEC. 2. SALE AND USE OF ENCRYPTION.
(a) IN GENERAL.—Part I of title 18, United States
Code, is amended by inserting after chapter 121 the fol-
lowing new chapter:
‘‘CHAPTER 122—ENCRYPTED WIRE AND
ELECTRONIC INFORMATION
‘‘2801. Definitions.
‘‘2802. Freedom to use encryption.
•H.R. 695 RH
‘‘2803. Freedom to sell encryption.
‘‘2804. Prohibition on mandatory key escrow.
‘‘2805. Unlawful use of encryption in furtherance of a criminal act.
‘‘§ 2801. Definitions
‘‘As used in this chapter—
‘‘(1) the terms ‘person’, ‘State’, ‘wire commu-
nication’, ‘electronic communication’, ‘investigative
or law enforcement officer’, ‘judge of competent ju-
risdiction’, and ‘electronic storage’ have the mean-
ings given those terms in section 2510 of this title;
‘‘(2) the terms ‘encrypt’ and ‘encryption’ refer
to the scrambling of wire or electronic information
using mathematical formulas or algorithms in order
to preserve the confidentiality, integrity, or authen-
ticity of, and prevent unauthorized recipients from
accessing or altering, such information;
‘‘(3) the term ‘key’ means the variable informa-
tion used in a mathematical formula, code, or algo-
rithm, or any component thereof, used to decrypt
wire
or
electronic
information
that
has
been
encrypted; and
‘‘(4) the term ‘United States person’ means—
‘‘(A) any United States citizen;
‘‘(B) any other person organized under the
laws of any State, the District of Columbia, or
any commonwealth, territory, or possession of
the United States; and
•H.R. 695 RH
‘‘(C) any person organized under the laws
of any foreign country who is owned or con-
trolled by individuals or persons described in
subparagraphs (A) and (B).
‘‘§ 2802. Freedom to use encryption
‘‘Subject to section 2805, it shall be lawful for any
person within any State, and for any United States person
in a foreign country, to use any encryption, regardless of
the encryption algorithm selected, encryption key length
chosen, or implementation technique or medium used.
‘‘§ 2803. Freedom to sell encryption
‘‘Subject to section 2805, it shall be lawful for any
person within any State to sell in interstate commerce any
encryption, regardless of the encryption algorithm se-
lected, encryption key length chosen, or implementation
technique or medium used.
‘‘§ 2804. Prohibition on mandatory key escrow
‘‘(a) PROHIBITION.—No person in lawful possession
of a key to encrypted information may be required by Fed-
eral or State law to relinquish to another person control
of that key.
‘‘(b) EXCEPTION FOR ACCESS FOR LAW ENFORCE-
MENT PURPOSES.—Subsection (a) shall not affect the au-
thority of any investigative or law enforcement officer, act-
•H.R. 695 RH
ing under any law in effect on the effective date of this
chapter, to gain access to encrypted information.
‘‘§ 2805. Unlawful use of encryption in furtherance of
a criminal act
‘‘Any person who willfully uses encryption in further-
ance of the commission of a criminal offense for which
the person may be prosecuted in a court of competent ju-
risdiction—
‘‘(1) in the case of a first offense under this
section, shall be imprisoned for not more than 5
years, or fined in the amount set forth in this title,
or both; and
‘‘(2) in the case of a second or subsequent of-
fense under this section, shall be imprisoned for not
more than 10 years, or fined in the amount set forth
in this title, or both.’’.
(b) CONFORMING AMENDMENT.—The table of chap-
ters for part I of title 18, United States Code, is amended
by inserting after the item relating to chapter 33 the fol-
lowing new item:
‘‘122. Encrypted wire and electronic information ................ 2801’’.
øSEC. 3. EXPORTS OF ENCRYPTION.
ø(a) AMENDMENT TO EXPORT ADMINISTRATION ACT
OF 1979.—Section 17 of the Export Administration Act
of 1979 (50 U.S.C. App. 2416) is amended by adding at
the end thereof the following new subsection:
•H.R. 695 RH
ø‘‘(g) COMPUTERS AND RELATED EQUIPMENT.—
ø‘‘(1) GENERAL RULE.—Subject to paragraphs
(2), (3), and (4), the Secretary shall have exclusive
authority to control exports of all computer hard-
ware, software, and technology for information secu-
rity (including encryption), except that which is spe-
cifically designed or modified for military use, in-
cluding command, control, and intelligence applica-
tions.
ø‘‘(2) ITEMS NOT REQUIRING LICENSES.—No
validated license may be required, except pursuant
to the Trading With The Enemy Act or the Inter-
national Emergency Economic Powers Act (but only
to the extent that the authority of such Act is not
exercised to extend controls imposed under this Act),
for the export or reexport of—
ø‘‘(A) any software, including software
with encryption capabilities—
ø‘‘(i) that is generally available, as is,
and is designed for installation by the pur-
chaser; or
ø‘‘(ii) that is in the public domain for
which copyright or other protection is not
available under title 17, United States
Code, or that is available to the public be-
•H.R. 695 RH
cause it is generally accessible to the inter-
ested public in any form; or
ø‘‘(B) any computing device solely because
it incorporates or employs in any form software
(including software with encryption capabilities)
exempted from any requirement for a validated
license under subparagraph (A).
ø‘‘(3) SOFTWARE WITH ENCRYPTION CAPABILI-
TIES.—The Secretary shall authorize the export or
reexport of software with encryption capabilities for
nonmilitary end uses in any country to which ex-
ports of software of similar capability are permitted
for use by financial institutions not controlled in fact
by United States persons, unless there is substantial
evidence that such software will be—
ø‘‘(A) diverted to a military end use or an
end use supporting international terrorism;
ø‘‘(B) modified for military or terrorist
end use; or
ø‘‘(C) reexported without any authoriza-
tion by the United States that may be required
under this Act.
ø‘‘(4) HARDWARE WITH ENCRYPTION CAPABILI-
TIES.—The Secretary shall authorize the export or
reexport of computer hardware with encryption ca-
•H.R. 695 RH
pabilities if the Secretary determines that a product
offering comparable security is commercially avail-
able outside the United States from a foreign sup-
plier, without effective restrictions.
ø‘‘(5) DEFINITIONS.—As used in this sub-
section—
ø‘‘(A) the term ‘encryption’ means the
scrambling of wire or electronic information
using mathematical formulas or algorithms in
order to preserve the confidentiality, integrity,
or authenticity of, and prevent unauthorized re-
cipients from accessing or altering, such infor-
mation;
ø‘‘(B) the term ‘generally available’ means,
in the case of software (including software with
encryption capabilities), software that is offered
for sale, license, or transfer to any person with-
out restriction, whether or not for consider-
ation, including, but not limited to, over-the-
counter retail sales, mail order transactions,
phone order transactions, electronic distribu-
tion, or sale on approval;
ø‘‘(C) the term ‘as is’ means, in the case
of software (including software with encryption
capabilities), a software program that is not de-
•H.R. 695 RH
signed, developed, or tailored by the software
publisher for specific purchasers, except that
such purchasers may supply certain installation
parameters needed by the software program to
function properly with the purchaser’s system
and may customize the software program by
choosing among options contained in the soft-
ware program;
ø‘‘(D) the term ‘is designed for installation
by the purchaser’ means, in the case of soft-
ware (including software with encryption capa-
bilities) that—
ø‘‘(i) the software publisher intends
for the purchaser (including any licensee or
transferee), who may not be the actual
program user, to install the software pro-
gram on a computing device and has sup-
plied the necessary instructions to do so,
except that the publisher may also provide
telephone help line services for software in-
stallation, electronic transmission, or basic
operations; and
ø‘‘(ii) the software program is de-
signed for installation by the purchaser
•H.R. 695 RH
without further substantial support by the
supplier;
ø‘‘(E) the term ‘computing device’ means
a device which incorporates one or more micro-
processor-based central processing units that
can accept, store, process, or provide output of
data; and
ø‘‘(F) the term ‘computer hardware’, when
used in conjunction with information security,
includes, but is not limited to, computer sys-
tems,
equipment,
application-specific
assem-
blies, modules, and integrated circuits.’’.
ø(b) CONTINUATION OF EXPORT ADMINISTRATION
ACT.—For purposes of carrying out the amendment made
by subsection (a), the Export Administration Act of 1979
shall be deemed to be in effect.¿
SEC. 3. EXPORTS OF ENCRYPTION.
(a) EXPORT CONTROL OF ENCRYPTION PROD-
UCTS NOT CONTROLLED ON THE UNITED STATES
MUNITIONS LIST.—The Secretary of Commerce,
with the concurrence of the Secretary of De-
fense, shall have the authority to control the
export of encryption products not controlled
on the United States Munitions List. Decisions
made by the Secretary of Commerce with the
•H.R. 695 RH
concurrence of the Secretary of Defense with
respect to exports of encryption products
under this section shall not be subject to judi-
cial review.
(b) 
LICENSE
EXCEPTION
FOR
CERTAIN
ENCRYPTION PRODUCTS.—Encryption products
with encryption strength equal to or less than
the level identified in subsection (d) shall be
eligible for export under a license exception
after a 1-time review, if the encryption product
being exported does not include features that
would otherwise require licensing under ap-
plicable regulations, is not destined for coun-
tries, end-users, or end-uses that the Secretary
of Commerce has determined by regulation,
with the concurrence of the Secretary of De-
fense, are ineligible to receive such products,
and is otherwise qualified for export.
(c) ONE-TIME PRODUCT REVIEW.—The Sec-
retary of Commerce, with the concurrence of
the Secretary of Defense, shall specify the in-
formation that must be submitted for the 1-
time review referred to in subsection (b).
(d) ELIGIBLE ENCRYPTION LEVELS.—
•H.R. 695 RH
(1) 
INITIAL
ELIGIBILITY
LEVEL.—Not
later than 30 days after the date of the en-
actment of this Act, the President shall
notify the Congress of the maximum level
of encryption strength that could be ex-
ported from the United States under li-
cense exception pursuant to this section
without harm to the national security of
the United States. Such level shall not be-
come effective until 60 days after such no-
tification.
(2) 
ANNUAL
REVIEW
OF
ELIGIBILITY
LEVEL.—Not later than 1 year after notify-
ing the Congress of the maximum level of
encryption strength under paragraph (1),
and annually thereafter, the President
shall notify the Congress of the maximum
level of encryption strength that could be
exported from the United States under li-
cense exception pursuant to this section
without harm to the national security of
the United States. Such level shall not be-
come effective until 60 days after such no-
tification.
•H.R. 695 RH
(3) CALCULATION
OF
60-DAY
PERIOD.—
The 60-day period referred to in para-
graphs (1) and (2) shall be computed by
excluding—
(A) the days on which either
House is not in session because of an
adjournment of more than 3 days to a
day certain or an adjournment of the
Congress sine die; and
(B) each Saturday and Sunday,
not excluded under subparagraph (A),
when either House is not in session.
(e) EXCERCISE OF EXISTING AUTHORITIES.—
The Secretary of Commerce and the Secretary
of Defense may exercise the authorities they
have under other provisions of law to carry out
this section.
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Security and Freedom
Through Encryption (SAFE) Act’’.
SEC. 2. SALE AND USE OF ENCRYPTION.
(a) IN GENERAL.—Part I of title 18, United States
Code, is amended by inserting after chapter 123 the follow-
ing new chapter:
•H.R. 695 RH
‘‘CHAPTER 125—ENCRYPTED WIRE AND
ELECTRONIC INFORMATION
‘‘2801. Definitions.
‘‘2802. Freedom to use encryption.
‘‘2803. Freedom to sell encryption.
‘‘2804. Prohibition on mandatory key escrow.
‘‘2805. Unlawful use of encryption in furtherance of a criminal act.
‘‘§ 2801. Definitions
‘‘As used in this chapter—
‘‘(1) the terms ‘person’, ‘State’, ‘wire commu-
nication’, ‘electronic communication’, ‘investigative or
law enforcement officer’, and ‘judge of competent ju-
risdiction’ have the meanings given those terms in
section 2510 of this title;
‘‘(2) the terms ‘encrypt’ and ‘encryption’ refer to
the scrambling of wire communications, electronic
communications, or electronically stored information,
using mathematical formulas or algorithms in order
to preserve the confidentiality, integrity, or authentic-
ity of, and prevent unauthorized recipients from
accessing or altering, such communications or infor-
mation;
‘‘(3) the term ‘key’ means the variable informa-
tion used in a mathematical formula, code, or algo-
rithm, or any component thereof, used to decrypt wire
communications, electronic communications, or elec-
tronically 
stored 
information, 
that 
has 
been
encrypted; and
•H.R. 695 RH
‘‘(4) the term ‘United States person’ means—
‘‘(A) any United States citizen;
‘‘(B) any other person organized under the
laws of any State, the District of Columbia, or
any commonwealth, territory, or possession of
the United States; and
‘‘(C) any person organized under the laws
of any foreign country who is owned or con-
trolled by individuals or persons described in
subparagraphs (A) and (B).
‘‘§ 2802. Freedom to use encryption
‘‘Subject to section 2805, it shall be lawful for any per-
son within any State, and for any United States person
in a foreign country, to use any encryption, regardless of
the encryption algorithm selected, encryption key length
chosen, or implementation technique or medium used.
‘‘§ 2803. Freedom to sell encryption
‘‘Subject to section 2805, it shall be lawful for any per-
son within any State to sell in interstate commerce any
encryption, regardless of the encryption algorithm selected,
encryption key length chosen, or implementation technique
or medium used.
‘‘§ 2804. Prohibition on mandatory key escrow
‘‘(a) PROHIBITION.—No person in lawful possession of
a key to encrypted communications or information may be
•H.R. 695 RH
required by Federal or State law to relinquish to another
person control of that key.
‘‘(b) EXCEPTION FOR ACCESS FOR LAW ENFORCEMENT
PURPOSES.—Subsection (a) shall not affect the authority
of any investigative or law enforcement officer, or any
member of the intelligence community as defined in section
3 of the National Security Act of 1947 (50 U.S.C. 401a),
acting under any law in effect on the effective date of this
chapter, to gain access to encrypted communications or in-
formation.
‘‘§ 2805. Unlawful use of encryption in furtherance of
a criminal act
‘‘Any person who, in the commission of a felony under
a criminal statute of the United States, knowingly and will-
fully encrypts incriminating communications or informa-
tion relating to that felony with the intent to conceal such
communications or information for the purpose of avoiding
detection by law enforcement agencies or prosecution—
‘‘(1) in the case of a first offense under this sec-
tion, shall be imprisoned for not more than 5 years,
or fined in the amount set forth in this title, or both;
and
‘‘(2) in the case of a second or subsequent offense
under this section, shall be imprisoned for not more
•H.R. 695 RH
than 10 years, or fined in the amount set forth in this
title, or both.’’.
(b) CONFORMING AMENDMENT.—The table of chapters
for part I of title 18, United States Code, is amended by
inserting after the item relating to chapter 123 the following
new item:
‘‘125. Encrypted wire and electronic information ................... 2801’’.
SEC. 3. EXPORTS OF ENCRYPTION.
(a) AMENDMENT TO EXPORT ADMINISTRATION ACT OF
1979.—Section 17 of the Export Administration Act of
1979 (50 U.S.C. App. 2416) is amended by adding at the
end thereof the following new subsection:
‘‘(g) COMPUTERS AND RELATED EQUIPMENT.—
‘‘(1) GENERAL
RULE.—Subject to paragraphs
(2), (3), and (4), the Secretary shall have exclusive
authority to control exports of all computer hardware,
software, and technology for information security (in-
cluding encryption), except that which is specifically
designed or modified for military use, including com-
mand, control, and intelligence applications.
‘‘(2) ITEMS NOT REQUIRING LICENSES.—No vali-
dated license may be required, except pursuant to the
Trading With The Enemy Act or the International
Emergency Economic Powers Act (but only to the ex-
tent that the authority of such Act is not exercised to
•H.R. 695 RH
extend controls imposed under this Act), for the export
or reexport of—
‘‘(A) any software, including software with
encryption capabilities—
‘‘(i) that is generally available, as is,
and is designed for installation by the pur-
chaser; or
‘‘(ii) that is in the public domain for
which copyright or other protection is not
available under title 17, United States
Code, or that is available to the public be-
cause it is generally accessible to the inter-
ested public in any form; or
‘‘(B) any computing device solely because it
incorporates or employs in any form software
(including software with encryption capabilities)
exempted from any requirement for a validated
license under subparagraph (A).
‘‘(3) SOFTWARE
WITH
ENCRYPTION
CAPABILI-
TIES.—The Secretary shall authorize the export or re-
export of software with encryption capabilities for
nonmilitary end uses in any country to which exports
of software of similar capability are permitted for use
by financial institutions not controlled in fact by
•H.R. 695 RH
United States persons, unless there is substantial evi-
dence that such software will be—
‘‘(A) diverted to a military end use or an
end use supporting international terrorism;
‘‘(B) modified for military or terrorist end
use; or
‘‘(C) reexported without any authorization
by the United States that may be required under
this Act.
‘‘(4) HARDWARE
WITH
ENCRYPTION
CAPABILI-
TIES.—The Secretary shall authorize the export or re-
export of computer hardware with encryption capa-
bilities if the Secretary determines that a product of-
fering comparable security is commercially available
outside the United States from a foreign supplier,
without effective restrictions.
‘‘(5) DEFINITIONS.—As used in this subsection—
‘‘(A) the term ‘encryption’ means the scram-
bling of wire or electronic information using
mathematical formulas or algorithms in order to
preserve the confidentiality, integrity, or authen-
ticity of, and prevent unauthorized recipients
from accessing or altering, such information;
‘‘(B) the term ‘generally available’ means,
in the case of software (including software with
•H.R. 695 RH
encryption capabilities), software that is offered
for sale, license, or transfer to any person with-
out restriction, whether or not for consideration,
including, but not limited to, over-the-counter re-
tail sales, mail order transactions, phone order
transactions, electronic distribution, or sale on
approval;
‘‘(C) the term ‘as is’ means, in the case of
software (including software with encryption ca-
pabilities), a software program that is not de-
signed, developed, or tailored by the software
publisher for specific purchasers, except that such
purchasers may supply certain installation pa-
rameters needed by the software program to
function properly with the purchaser’s system
and may customize the software program by
choosing among options contained in the soft-
ware program;
‘‘(D) the term ‘is designed for installation
by the purchaser’ means, in the case of software
(including software with encryption capabilities)
that—
‘‘(i) the software publisher intends for
the purchaser (including any licensee or
transferee), who may not be the actual pro-
•H.R. 695 RH
gram user, to install the software program
on a computing device and has supplied the
necessary instructions to do so, except that
the publisher may also provide telephone
help line services for software installation,
electronic transmission, or basic operations;
and
‘‘(ii) the software program is designed
for installation by the purchaser without
further substantial support by the supplier;
‘‘(E) the term ‘computing device’ means a
device which incorporates one or more micro-
processor-based central processing units that can
accept, store, process, or provide output of data;
and
‘‘(F) the term ‘computer hardware’, when
used in conjunction with information security,
includes, but is not limited to, computer systems,
equipment, application-specific assemblies, mod-
ules, and integrated circuits.’’.
(b) CONTINUATION
OF
EXPORT
ADMINISTRATION
ACT.—For purposes of carrying out the amendment made
by subsection (a), the Export Administration Act of 1979
shall be deemed to be in effect.
•H.R. 695 RH
SEC. 4. EFFECT ON LAW ENFORCEMENT ACTIVITIES.
(a) COLLECTION OF INFORMATION BY ATTORNEY GEN-
ERAL.—The Attorney General shall compile, and maintain
in classified form, data on the instances in which
encryption (as defined in section 2801 of title 18, United
States Code) has interfered with, impeded, or obstructed the
ability of the Department of Justice to enforce the criminal
laws of the United States.
(b) AVAILABILITY
OF INFORMATION
TO
THE CON-
GRESS.—The information compiled under subsection (a),
including an unclassified summary thereof, shall be made
available, upon request, to any Member of Congress.
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Security and
Freedom Through Encryption (SAFE) Act’’.
SEC. 2. SALE AND USE OF ENCRYPTION.
(a) IN GENERAL.—Part I of title 18, United
States Code, is amended by inserting after
chapter 121 the following new chapter:
‘‘CHAPTER 122—ENCRYPTED WIRE AND
ELECTRONIC INFORMATION
‘‘2801. Definitions.
‘‘2802. Freedom to use encryption.
‘‘2803. Freedom to sell encryption.
‘‘2804. Prohibition on mandatory key escrow.
‘‘2805. Unlawful use of encryption in furtherance of a criminal
act.
•H.R. 695 RH
‘‘§ 2801. Definitions
‘‘As used in this chapter—
‘‘(1) the terms ‘person’, ‘State’, ‘wire
communication’, ‘electronic communica-
tion’, ‘investigative or law enforcement
officer’, ‘judge of competent jurisdiction’,
and ‘electronic storage’ have the mean-
ings given those terms in section 2510 of
this title;
‘‘(2) 
the 
terms 
‘encrypt’ 
and
‘encryption’ refer to the scrambling of
wire or electronic information using
mathematical formulas or algorithms in
order to preserve the confidentiality, in-
tegrity, or authenticity of, and prevent
unauthorized recipients from accessing
or altering, such information;
‘‘(3) the term ‘key’ means the variable
information used in a mathematical for-
mula, code, or algorithm, or any compo-
nent thereof, used to decrypt wire or
electronic information that has been
encrypted; and
‘‘(4) the term ‘United States person’
means—
‘‘(A) any United States citizen;
•H.R. 695 RH
‘‘(B) any other person organized
under the laws of any State, the Dis-
trict of Columbia, or any common-
wealth, territory, or possession of the
United States; and
‘‘(C) any person organized under
the laws of any foreign country who
is owned or controlled by individuals
or persons described in subpara-
graphs (A) and (B).
‘‘§ 2802. Freedom to use encryption
‘‘Subject to section 2805, it shall be lawful
for any person within any State, and for any
United States person in a foreign country, to
use 
any 
encryption, 
regardless 
of 
the
encryption algorithm selected, encryption
key length chosen, or implementation tech-
nique or medium used.
‘‘§ 2803. Freedom to sell encryption
‘‘Subject to section 2805, it shall be lawful
for any person within any State to sell in
interstate commerce any encryption, regard-
less of the encryption algorithm selected,
encryption key length chosen, or implementa-
tion technique or medium used.
•H.R. 695 RH
‘‘§ 2804. Prohibition on mandatory key escrow
‘‘(a) PROHIBITION.—No person in lawful
possession of a key to encrypted information
may be required by Federal or State law to re-
linquish to another person control of that key.
‘‘(b) EXCEPTION FOR ACCESS FOR LAW EN-
FORCEMENT PURPOSES.—Subsection (a) shall
not affect the authority of any investigative or
law enforcement officer, acting under any law
in effect on the effective date of this chapter,
to gain access to encrypted information.
‘‘§ 2805. Unlawful use of encryption in furtherance of
a criminal act
‘‘Any person who willfully uses encryption
in furtherance of the commission of a crimi-
nal offense for which the person may be pros-
ecuted in a court of competent jurisdiction—
‘‘(1) in the case of a first offense
under this section, shall be imprisoned
for not more than 5 years, or fined in the
amount set forth in this title, or both; and
‘‘(2) in the case of a second or subse-
quent offense under this section, shall be
imprisoned for not more than 10 years, or
fined in the amount set forth in this title,
or both.’’.
•H.R. 695 RH
(b) CONFORMING AMENDMENT.—The table of
chapters for part I of title 18, United States
Code, is amended by inserting after the item
relating to chapter 33 the following new item:
‘‘122. Encrypted wire and electronic information ............... 2801’’.
SEC. 3. EXPORTS OF ENCRYPTION.
(a) AMENDMENT TO EXPORT ADMINISTRATION
ACT OF 1979.—Section 17 of the Export Admin-
istration Act of 1979 (50 U.S.C. App. 2416) is
amended by adding at the end thereof the fol-
lowing new subsection:
‘‘(g) CERTAIN CONSUMER PRODUCTS, COM-
PUTERS, AND RELATED EQUIPMENT.—
‘‘(1) GENERAL RULE.—Subject to para-
graphs (2), (3), and (4), the Secretary shall
have exclusive authority to control ex-
ports of all computer hardware, software,
and technology for information security
(including encryption), except that which
is specifically designed or modified for
military use, including command, control,
and intelligence applications.
‘‘(2) ITEMS NOT REQUIRING LICENSES.—
No validated license may be required, ex-
cept pursuant to the Trading With The
Enemy Act or the International Emer-
•H.R. 695 RH
gency Economic Powers Act (but only to
the extent that the authority of such Act
is not exercised to extend controls im-
posed under this Act), for the export or
reexport of—
‘‘(A) any consumer product com-
mercially available within the United
States or abroad which—
‘‘(i) includes encryption capa-
bilities which are inaccessible to
the end user; and
‘‘(ii) is not designed for mili-
tary or intelligence end use;
‘‘(B) any component or subassem-
bly designed for use in a consumer
product described in subparagraph
(A) which itself contains encryption
capabilities and is not capable of mili-
tary or intelligence end use in its con-
dition as exported;
‘‘(C) any software, including soft-
ware with encryption capabilities—
‘‘(i) that is generally available,
as is, and is designed for installa-
tion by the purchaser;
•H.R. 695 RH
‘‘(ii) that is in the public do-
main for which copyright or other
protection is not available under
title 17, United States Code, or
that is available to the public be-
cause it is generally accessible to
the interested public in any form;
or
‘‘(iii) that is customized for an
otherwise lawful use by a specific
purchaser or group of purchasers;
‘‘(D) any computing device solely
because it incorporates or employs in
any form—
‘‘(i) software (including soft-
ware with encryption capabili-
ties) that is exempted from any
requirement for a validated li-
cense under subparagraph (C); or
‘‘(ii) software that is no more
technically 
complex 
in 
its
encryption capabilties than soft-
ware that is exempted from any
requirement for a validated li-
cense under subparagraph (C) but
•H.R. 695 RH
is not designed for installation by
the purchaser;
‘‘(E) any computer hardware that
is generally available, solely because
it has encryption capabilities; or
‘‘(F) any software or computing
device solely on the basis that it in-
corporates or employs in any form
interface mechanisms for interaction
with other hardware and software,
including hardware, and software,
with encryption capabilities.
‘‘(3) SOFTWARE WITH ENCRYPTION CAPA-
BILITIES.—The Secretary shall authorize
the export or reexport of software with
encryption capabilities for nonmilitary
end uses in any country to which exports
of software of similar capability are per-
mitted for use by financial institutions
not controlled in fact by United States
persons, unless there is substantial evi-
dence that such software will be—
‘‘(A) diverted to a military end use
or an end use supporting inter-
national terrorism;
•H.R. 695 RH
‘‘(B) modified for military or ter-
rorist end use; or
‘‘(C) reexported without any au-
thorization by the United States that
may be required under this Act.
‘‘(4) HARDWARE WITH ENCRYPTION CAPA-
BILITIES.—The Secretary shall authorize
the export or reexport of computer hard-
ware with encryption capabilities if the
Secretary determines that a product of-
fering comparable security is commer-
cially available outside the United States
from a foreign supplier, without effective
restrictions.
‘‘(5) DEFINITIONS.—As used in this sub-
section—
‘‘(A) the term ‘encryption’ means
the scrambling of wire or electronic
information using mathematical for-
mulas or algorithms in order to pre-
serve the confidentiality, integrity, or
authenticity of, and prevent unau-
thorized recipients from accessing or
altering, such information;
•H.R. 695 RH
‘‘(B) the term ‘generally available’
means—
‘‘(i) in the case of software (in-
cluding software with encryption
capabilities), software that is of-
fered for sale, license, or transfer
to any person without restriction,
whether or not for consideration,
including, but not limited to,
over-the-counter retail sales, mail
order transactions, phone order
transactions, electronic distribu-
tion, or sale on approval; and
‘‘(ii) in the case of hardware
with 
encryption 
capabilities,
hardware that is offered for sale,
license, or transfer to any person
without restriction, whether or
not for consideration, including,
but 
not 
limited 
to, 
over-the-
counter retail sales, mail order
transactions, phone order trans-
actions, electronic distribution, or
sale on approval;
•H.R. 695 RH
‘‘(C) the term ‘as is’ means, in the
case of software (including software
with encryption capabilities), a soft-
ware program that is not designed,
developed, or tailored by the software
publisher for specific purchasers, ex-
cept that such purchasers may supply
certain installation parameters need-
ed by the software program to func-
tion properly with the purchaser’s
system and may customize the soft-
ware program by choosing among op-
tions contained in the software pro-
gram;
‘‘(D) the term ‘is designed for in-
stallation by the purchaser’ means, in
the case of software (including soft-
ware with encryption capabilities)
that—
‘‘(i) the software publisher in-
tends for the purchaser (includ-
ing any licensee or transferee),
who may not be the actual pro-
gram user, to install the software
program on a computing device
•H.R. 695 RH
and has supplied the necessary
instructions to do so, except that
the publisher may also provide
telephone help line services for
software installation, electronic
transmission, or basic operations;
and
‘‘(ii) the software program is
designed for installation by the
purchaser without further sub-
stantial support by the supplier;
‘‘(E) the term ‘computing device’
means a device which incorporates
one or more microprocessor-based
central processing units that can ac-
cept, store, process, or provide output
of data; and
‘‘(F) the term ‘computer hard-
ware’, when used in conjunction with
information security, includes, but is
not limited to, computer systems,
equipment, 
application-specific 
as-
semblies, modules, and integrated cir-
cuits.’’.
•H.R. 695 RH
(b) CONTINUATION OF EXPORT ADMINISTRA-
TION ACT.—For purposes of carrying out the
amendment made by subsection (a), the Ex-
port Administration Act of 1979 shall be
deemed to be in effect.
SEC. 4. SENSE OF CONGRESS REGARDING INTERNATIONAL
COOPERATION.
(a) FINDINGS.—The Congress finds that—
(1) implementing export restrictions
on widely available technology without
the concurrence of all countries capable
of producing, transshipping, or otherwise
transferring that technology is detrimen-
tal to the competitiveness of the United
States and should only be imposed on
technology and countries in order to pro-
tect the United States against a compel-
ling national security threat; and
(2) the President has not been able to
come to agreement with other encryption
producing countries on export controls
on encryption and has imposed exces-
sively stringent export controls on this
widely available technology.
•H.R. 695 RH
(b) SENSE OF CONGRESS.—It is the sense of
the Congress that the President should imme-
diately take the necessary steps to call an
international conference for the purpose of
coming to an agreement with encryption pro-
ducing countries on policies which will en-
sure that the free use and trade of this tech-
nology does not hinder mutual security.
øøSECTION 1. SHORT TITLE; TABLE OF CONTENTS.
øø(a) SHORT TITLE.—This Act may be cited
as 
the 
‘‘Security 
and 
Freedom 
through
Encryption (‘SAFE’) Act of 1997’’.
øø(b) TABLE
OF CONTENTS.—The table of
contents is as follows:
øøSec. 1. Short title; table of contents.
øøSec. 2. Statement of policy.
øøTITLE I—DOMESTIC USES OF ENCRYPTION
øøSec. 101. Definitions.
øøSec. 102. Lawful use of encryption.
øøSec. 103. Voluntary private sector participation in key man-
agement infrastructure.
øøSec. 104. Unlawful use of encryption.
øøTITLE II—GOVERNMENT PROCUREMENT
øøSec. 201. Federal purchases of encryption products.
øøSec. 202. Encryption products purchased with Federal funds.
øøSec. 203. Networks established with Federal funds.
øøSec. 204. Product labels.
øøSec. 205. No private mandate.
øøSec. 206. Implementation.
øøTITLE III—EXPORTS OF ENCRYPTION
øøSec. 301. Exports of encryption.
øøSec. 302. License exception for certain encryption prod-
ucts.—
•H.R. 695 RH
øøSec. 303. License exception for telecommunications prod-
ucts.
øøSec. 304. Review for certain institutions.
øøSec. 305. Encryption 
industry 
and 
information 
security
board.
øøTITLE IV—LIABILITY LIMITATIONS
øøSec. 401. Compliance with court order.
øøSec. 402. Compliance defense.
øøSec. 403. Reasonable care defense.
øøSec. 404. Good faith defense.
øøSec. 405. Sovereign immunity.
øøSec. 406. Civil action, generally.
øøTITLE V—INTERNATIONAL AGREEMENTS
øøSec. 501. Sense of congress.
øøSec. 502. Failure to negotiate.
øøSec. 503. Report to congress.
øøTITLE VI—MISCELLANEOUS PROVISIONS
øøSec. 601. Effect on law enforcement activities.
øøSec. 602. Interpretation.
øøSec. 603. Severability.
øøSEC. 2. STATEMENT OF POLICY.
øøIt is the policy of the United States to
protect public computer networks through
the use of strong encryption technology, to
promote 
and 
improve 
the 
export 
of
encryption products developed and manufac-
tured in the United States, and to preserve
public safety and national security.
øøTITLE I—DOMESTIC USES OF
ENCRYPTION
øøSEC. 101. DEFINITIONS.
øøFor purposes of this Act:
øø(1) 
ATTORNEY
FOR
THE
GOVERN-
MENT.—The term ‘‘attorney for the Gov-
•H.R. 695 RH
ernment’’ has the meaning given such
term in Rule 54(c) of the Federal Rules of
Criminal Procedure, and also includes
any duly authorized attorney of a State
who is authorized to prosecute criminal
offenses within such State.
øø(2) 
CERTIFICATE
AUTHORITY.—The
term ‘‘certificate authority’’ means a per-
son trusted by one or more persons to
create and assign public key certificates.
øø(3) 
COMMUNICATIONS.—The 
term
‘‘communications’’ means any wire com-
munications or electronic communica-
tions as those terms are defined in para-
graphs (1) and (12) of section 2510 of title
18, United States Code.
øø(4) COURT
OF
COMPETENT
JURISDIC-
TION.—The term ‘‘court of competent ju-
risdiction’’ means any court of the United
States organized under Article III of the
Constitution of the United States, the
court organized under the Foreign Intel-
ligence Surveillance Act of 1978 (50 U.S.C.
1801 et seq.), or a court of general crimi-
nal jurisdiction of a State authorized pur-
•H.R. 695 RH
suant to the laws of such State to enter
orders authorizing searches and seizures.
øø(5) DATA
NETWORK
SERVICE
PRO-
VIDER.—The term ‘‘data network service
provider’’ means a person offering any
service to the general public that pro-
vides the users thereof with the ability to
transmit or receive data, including com-
munications.
øø(6) 
DECRYPTION.—The 
term
‘‘decryption’’ means the retransformation
or unscrambling of encrypted data, in-
cluding communications, to its readable
plaintext version. To ‘‘decrypt’’ data, in-
cluding communications, is to perform
decryption.
øø(7) DECRYPTION
INFORMATION.—The
term ‘‘decryption information’’ means in-
formation or technology that enables one
to readily retransform or unscramble
encrypted data from its unreadable and
incomprehensible format to its readable
plaintext version.
øø(8) ELECTRONIC STORAGE.—The term
‘‘electronic storage’’ has the meaning
•H.R. 695 RH
given that term in section 2510(17) of title
18, United States Code.
øø(9) 
ENCRYPTION.—The 
term
‘‘encryption’’ means the transformation
or scrambling of data, including commu-
nications, 
from 
plaintext 
to 
an
unreadable or incomprehensible format,
regardless of the technique utilized for
such transformation or scrambling and
irrespective of the medium in which such
data, including communications, occur or
can be found, for the purposes of protect-
ing the content of such data, including
communications. To ‘‘encrypt’’ data, in-
cluding communications, is to perform
encryption.
øø(10) 
ENCRYPTION
PRODUCT.—The
term ‘‘encryption product’’ means any
software, technology, or mechanism, that
can be used to encrypt or decrypt, or has
the 
capability 
of 
encrypting 
or
decrypting any data, including commu-
nications.
øø(11) 
FOREIGN
AVAILABILITY.—The
term ‘‘foreign availability’’ has the mean-
•H.R. 695 RH
ing applied to foreign availability of
encryption products subject to controls
under the Export Administration Regula-
tions, as in effect on September 1, 1997.
øø(12) GOVERNMENT.—The term ‘‘Gov-
ernment’’ means the Government of the
United States and any agency or instru-
mentality thereof, or the government of
any State.
øø(13) INVESTIGATIVE OR LAW ENFORCE-
MENT
OFFICER.—The term ‘‘investigative
or law enforcement officer’’ has the
meaning given that term in section
2510(7) of title 18, United States Code.
øø(14) 
KEY
RECOVERY
AGENT.—The
term ‘‘key recovery agent’’ means a per-
son trusted by another person or persons
to 
hold 
and 
maintain 
sufficient
decryption information to allow for the
immediate decryption of the encrypted
data or communications of another per-
son or persons for whom that informa-
tion is held, and who holds and maintains
that information as a business or govern-
mental practice, whether or not for prof-
•H.R. 695 RH
it. The term ‘‘key recovery agent’’ in-
cludes any person who holds his or her
decryption information.
øø(15) NATIONAL SECURITY.—The term
‘‘national security’’ means the national
defense, foreign relations, or economic
interests of the United States.
øø(16) 
PLAINTEXT.—The 
term
‘‘plaintext’’ means the readable or com-
prehensible format of data, including
communications, 
prior 
to 
its 
being
encrypted or after it has been decrypted.
øø(17) 
PLAINVOICE.—The 
term
‘‘plainvoice’’ means communication spe-
cific plaintext.
øø(18) SECRETARY.—The term ‘‘Sec-
retary’’ means the Secretary of Com-
merce, unless otherwise specifically iden-
tified.
øø(19) STATE.—The term ‘‘State’’ has
the meaning given that term in section
2510(3) of title 18, United States Code.
øø(20) 
TELECOMMUNICATIONS
CAR-
RIER.—The 
term 
‘‘telecommunications
carrier’’ has the meaning given that term
•H.R. 695 RH
in section 102(8) of the Communications
Assistance for Law Enforcement Act (47
U.S.C. 1001(8)).
øø(21) TELECOMMUNICATIONS SYSTEM.—
The term ‘‘telecommunications system’’
means any equipment, technology, or re-
lated software used in the movement,
switching, interchange, transmission, re-
ception, or internal signaling of data, in-
cluding communications over wire, fiber
optic, radio frequency, or other medium.
øø(22) UNITED
STATES
PERSON.—The
term ‘‘United States person’’ means—
øø(A) any citizen of the United
States;
øø(B) any other person organized
under the laws of any State; and
øø(C) any person organized under
the laws of any foreign country who
is owned or controlled by individuals
or persons described in subpara-
graphs (A) and (B).
øøSEC. 102. LAWFUL USE OF ENCRYPTION.
øøExcept as otherwise provided by this
Act or otherwise provided by law, it shall be
•H.R. 695 RH
lawful for any person within any State and for
any 
United 
States 
person 
to 
use 
any
encryption product, regardless of encryption
algorithm selected, encryption key length
chosen, or implementation technique or me-
dium used.
øøSEC. 103. VOLUNTARY PRIVATE SECTOR PARTICIPATION
IN KEY MANAGEMENT INFRASTRUCTURE.
øø(a) USE IS VOLUNTARY.—The use of cer-
tificate authorities or key recovery agents is
voluntary.
øø(b) REGULATIONS.—The Secretary shall
promulgate regulations establishing stand-
ards for creating key management infrastruc-
tures. Such regulations should—
øø(1) allow for the voluntary partici-
pation by private persons and non-Fed-
eral entities; and
øø(2) promote the development of cer-
tificate authorities and key recovery
agents.
øø(c) REGISTRATION
OF CERTIFICATE AU-
THORITIES
AND KEY RECOVERY AGENTS.—Cer-
tificate authorities and key recovery agents
meeting the standards established by the Sec-
•H.R. 695 RH
retary may be registered by the Secretary if
they so choose, and may identify themselves
as meeting the standards of the Secretary.
øøSEC. 104. UNLAWFUL USE OF ENCRYPTION.
øø(a) IN GENERAL.—Part I of title 18, Unit-
ed States Code, is amended by inserting after
chapter 121 the following new chapter:
‘‘CHAPTER 122—ENCRYPTED DATA, INCLUDING
COMMUNICATIONS
‘‘Sec.
øø‘‘2801. Unlawful use of encryption in furtherance of a crimi-
nal act.
øø‘‘2802. Privacy protection.
øø‘‘2803. Unlawful sale of encryption.
øø‘‘2804. Encryption products manufactured and intended for
use in the United States.
øø‘‘2805. Injunctive relief and proceedings.
øø‘‘2806. Court order access to plaintext.
øø‘‘2807. Notification procedures.
øø‘‘2808. Lawful use of plaintext or decryption information.
øø‘‘2809. Identification of decryption information.
øø‘‘2810. Unlawful export of certain encryption products.
øø‘‘2811. Definitions.
øø‘‘§ 2801. Unlawful use of encryption in furtherance
of a criminal act
øø‘‘(a) PROHIBITED ACTS.—Whoever know-
ingly uses encryption in furtherance of the
commission of a criminal offense for which
the person may be prosecuted in a district
court of the United States shall—
øø‘‘(1) in the case of a first offense
under this section, be imprisoned for not
•H.R. 695 RH
more than 5 years, or fined under this
title, or both; and
øø‘‘(2) in the case of a second or sub-
sequent offense under this section, be im-
prisoned for not more than 10 years, or
fined under this title, or both.
øø‘‘(b) CONSECUTIVE SENTENCE.—Notwith-
standing any other provision of law, the court
shall not place on probation any person con-
victed of a violation of this section, nor shall
the term of imprisonment imposed under this
section run concurrently with any other term
of imprisonment imposed for the underlying
criminal offense.
øø‘‘(c) PROBABLE CAUSE NOT CONSTITUTED
BY
USE
OF
ENCRYPTION.—The 
use 
of
encryption alone shall not constitute prob-
able cause to believe that a crime is being or
has been committed.
øø‘‘§ 2802. Privacy protection
øø‘‘(a) IN GENERAL.—It shall be unlawful
for any person to intentionally—
øø‘‘(1) obtain or use decryption infor-
mation without lawful authority for the
•H.R. 695 RH
purpose of decrypting data, including
communications;
øø‘‘(2) exceed lawful authority in
decrypting data, including communica-
tions;
øø‘‘(3) break the encryption code of
another person without lawful authority
for the purpose of violating the privacy
or security of that person or depriving
that person of any property rights;
øø‘‘(4) impersonate another person for
the purpose of obtaining decryption in-
formation of that person without lawful
authority;
øø‘‘(5) 
facilitate 
or 
assist 
in 
the
encryption of data, including communica-
tions, knowing that such data, including
communications, are to be used in fur-
therance of a crime; or
øø‘‘(6) disclose decryption information
in violation of a provision of this chapter.
øø‘‘(b) CRIMINAL PENALTY.—Whoever vio-
lates this section shall be imprisoned for not
more than 10 years, or fined under this title,
or both.
•H.R. 695 RH
øø‘‘§ 2803. Unlawful sale of encryption
øø‘‘Whoever, after January 31, 2000, sells
in 
interstate 
or 
foreign 
commerce 
any
encryption product that does not include fea-
tures or functions permitting duly authorized
persons immediate access to plaintext or im-
mediate decryption capabilities shall be im-
prisoned for not more than 5 years, fined
under this title, or both.
øø‘‘§ 2804. Encryption products manufactured and in-
tended for use in the United States
øø‘‘(a) PUBLIC NETWORK SERVICE PROVID-
ERS.—After January 31, 2000, public network
service providers offering encryption prod-
ucts or encryption services shall ensure that
such products or services enable the imme-
diate decryption or access to plaintext of the
data, including communications, encrypted
by such products or services on the public
network upon receipt of a court order or war-
rant, pursuant to section 2806.
øø‘‘(b) MANUFACTURERS, DISTRIBUTORS, AND
IMPORTERS.—After January 31, 2000, it shall be
unlawful for any person to manufacture for
distribution, distribute, or import encryption
•H.R. 695 RH
products intended for sale or use in the Unit-
ed States, unless that product—
øø‘‘(1) includes features or functions
that provide an immediate access to
plaintext capability, through any means,
mechanism, 
or 
technological 
method
that—
øø‘‘(A) 
permits 
immediate
decryption of the encrypted data, in-
cluding communications, upon the re-
ceipt of decryption information by an
authorized party in possession of a
facially valid order issued by a court
of competent jurisdiction; and
øø‘‘(B) allows the decryption of
encrypted data, including commu-
nications, without the knowledge or
cooperation of the person being in-
vestigated, subject to the require-
ments set forth in section 2806;
øø‘‘(2) can be used only on systems or
networks that include features or func-
tions that provide an immediate access to
plaintext capability, through any means,
•H.R. 695 RH
mechanism, 
or 
technological 
method
that—
øø‘‘(A) 
permits 
immediate
decryption of the encrypted data, in-
cluding communications, upon the re-
ceipt of decryption information by an
authorized party in possession of a
facially valid order issued by a court
of competent jurisdiction; and
øø‘‘(B) allows the decryption of
encrypted data, including commu-
nications, without the knowledge or
cooperation of the person being in-
vestigated, subject to the require-
ments set forth in section 2806; or
øø‘‘(3) otherwise meets the technical
requirements and functional criteria pro-
mulgated by the Attorney General under
subsection (c).
øø‘‘(c) ATTORNEY GENERAL CRITERIA.—
øø‘‘(1) 
PUBLICATION
OF
REQUIRE-
MENTS.—Within 180 days after the date of
the enactment of this chapter, the Attor-
ney General shall publish in the Federal
Register 
technical 
requirements 
and
•H.R. 695 RH
functional criteria for complying with the
decryption requirements set forth in this
section.
øø‘‘(2) PROCEDURES FOR ADVISORY OPIN-
IONS.—Within 180 days after the date of
the enactment of this chapter, the Attor-
ney General shall promulgate procedures
by which data network service providers
and encryption product manufacturers,
sellers, re-sellers, distributors, and im-
porters may obtain advisory opinions as
to whether an encryption product in-
tended for sale or use in the United
States after January 31, 2000, meets the
requirements of this section and the tech-
nical requirements and functional cri-
teria promulgated pursuant to paragraph
(1).
øø‘‘(3) PARTICULAR
METHODOLOGY
NOT
REQUIRED.—Nothing in this chapter or
any other provision of law shall be con-
strued as requiring the implementation
of any particular decryption methodology
in order to satisfy the requirements of
subsections (a) and (b), or the technical
•H.R. 695 RH
requirements and functional criteria re-
quired by the Attorney General under
paragraph (1).
øø‘‘(d) USE OF PRIOR PRODUCTS LAWFUL.—
After January 31, 2000, it shall not be unlaw-
ful to use any encryption product purchased
or in use prior to such date.
øø‘‘§ 2805. Injunctive relief and proceedings
øø‘‘(a) INJUNCTION.—Whenever it appears
to the Secretary or the Attorney General that
any person is engaged in, or is about to en-
gage in, any act that constitutes, or would
constitute, a violation of section 2804, the At-
torney General may initiate a civil action in
a district court of the United States to enjoin
such violation. Upon the filing of the com-
plaint seeking injunctive relief by the Attor-
ney General, the court shall automatically
issue a temporary restraining order against
the party being sued.
øø‘‘(b) BURDEN
OF
PROOF.—In a suit
brought by the Attorney General under sub-
section (a), the burden shall be upon the Gov-
ernment to establish by a preponderance of
the evidence that the encryption product in-
•H.R. 695 RH
volved does not comport with the require-
ments set forth by the Attorney General pur-
suant to section 2804 providing for immediate
access to plaintext by Federal, State, or local
authorities.
øø‘‘(c) CLOSING OF PROCEEDINGS.—(1) Upon
motion of the party against whom injunction
is being sought—
øø‘‘(A) any or all of the proceedings
under this section shall be closed to the
public; and
øø‘‘(B) public disclosure of the pro-
ceedings shall be treated as contempt of
court.
øø‘‘(2) Upon a written finding by the court
that public disclosure of information relevant
to the prosecution of the injunction or rel-
evant to a determination of the factual or
legal issues raised in the case would cause ir-
reparable or financial harm to the party
against whom the suit is brought, or would
otherwise disclose proprietary information of
any party to the case, all proceedings shall be
closed to members of the public, except the
parties to the suit, and all transcripts, mo-
•H.R. 695 RH
tions, and orders shall be placed under seal to
protect their disclosure to the general public.
øø‘‘(d) ADVISORY OPINION AS DEFENSE.—It
is an absolute defense to a suit under this sub-
section that the party against whom suit is
brought obtained an advisory opinion from
the Attorney General pursuant to section
2804(c) and that the product at issue in the
suit comports in every aspect with the re-
quirements announced in such advisory opin-
ion.
øø‘‘(e) BASIS FOR PERMANENT INJUNCTION.—
The court shall issue a permanent injunction
against the distribution of, and any future
manufacture of, the encryption product at
issue in the suit filed under subsection (a) if
the court finds by a preponderance of the evi-
dence that the product does not meet the re-
quirements set forth by the Attorney General
pursuant to section 2804 providing for imme-
diate access to plaintext by Federal, State, or
local authorities.
øø‘‘(f) APPEALS.—Either party may appeal,
to the appellate court with jurisdiction of the
case, any adverse ruling by the district court
•H.R. 695 RH
entered pursuant to this section. For the pur-
poses of appeal, the parties shall be governed
by the Federal Rules of Appellate Procedure,
except that the Government shall file its no-
tice of appeal not later than 30 days after the
entry of the final order on the docket of the
district court. The appeal of such matter shall
be considered on an expedited basis and re-
solved as soon as practicable.
øø‘‘§ 2806. Court order access to plaintext
øø‘‘(a) COURT ORDER.—(1) A court of com-
petent jurisdiction shall issue an order, ex
parte, granting an investigative or law en-
forcement officer immediate access to the
plaintext of encrypted data, including com-
munications, or requiring any person in pos-
session of decryption information to provide
such information to a duly authorized inves-
tigative or law enforcement officer—
øø‘‘(A) upon the application by an at-
torney for the Government that—
øø‘‘(i) is made under oath or affir-
mation by the attorney for the Gov-
ernment; and
•H.R. 695 RH
øø‘‘(ii) provides a factual basis es-
tablishing the relevance that the
plaintext or decryption information
being sought has to a law enforce-
ment or foreign counterintelligence
investigation then being conducted
pursuant to lawful authorities; and
øø‘‘(B) if the court finds, in writing,
that the plaintext or decryption informa-
tion being sought is relevant to an ongo-
ing lawful law enforcement or foreign
counterintelligence investigation and the
investigative or law enforcement officer
is entitled to such plaintext or decryption
information.
øø‘‘(2) The order issued by the court under
this section shall be placed under seal, except
that a copy may be made available to the in-
vestigative or law enforcement officer author-
ized to obtain access to the plaintext of the
encrypted information, or authorized to ob-
tain the decryption information sought in the
application. Such order shall also be made
available to the person responsible for provid-
ing the plaintext or the decryption informa-
•H.R. 695 RH
tion, pursuant to such order, to the investiga-
tive or law enforcement officer.
øø‘‘(3) Disclosure of an application made,
or order issued, under this section, is not au-
thorized, except as may otherwise be specifi-
cally permitted by this section or another
order of the court.
øø‘‘(b) OTHER ORDERS.—An attorney for
the Government may make application to a
district court of the United States for an order
under subsection (a), upon a request from a
foreign country pursuant to a Mutual Legal
Assistance Treaty with such country that is in
effect at the time of the request from such
country.
øø‘‘(c) RECORD OF ACCESS REQUIRED.—(1)
There shall be created an electronic record,
or similar type record, of each instance in
which an investigative or law enforcement of-
ficer, pursuant to an order under this section,
gains access to the plaintext of otherwise
encrypted 
information, 
or 
is 
provided
decryption information, without the knowl-
edge or consent of the owner of the data, in-
•H.R. 695 RH
cluding communications, who is the user of
the encryption product involved.
øø‘‘(2) The court issuing the order under
this section shall require that the electronic
or similar type of record described in para-
graph (1) is maintained in a place and a man-
ner that is not within the custody or control
of an investigative or law enforcement officer
gaining the access or provided the decryption
information. The record shall be tendered to
the court, upon notice from the court.
øø‘‘(3) The court receiving such electronic
or similar type of record described in para-
graph (1) shall make the original and a cer-
tified copy of the record available to the attor-
ney for the Government making application
under this section, and to the attorney for, or
directly to, the owner of the data, including
communications, who is the user of the
encryption product.
øø‘‘(d) AUTHORITY
TO INTERCEPT COMMU-
NICATIONS NOT INCREASED.—Nothing in this
chapter shall be construed to enlarge or mod-
ify the circumstances or procedures under
which a Government entity is entitled to
•H.R. 695 RH
intercept or obtain oral, wire, or electronic
communications or information.
øø‘‘(e) CONSTRUCTION.—This chapter shall
be strictly construed to apply only to a Gov-
ernment entity’s ability to decrypt data, in-
cluding communications, for which it has pre-
viously obtained lawful authority to intercept
or obtain pursuant to other lawful authorities
that would otherwise remain encrypted.
øø‘‘§ 2807. Notification procedures
øø‘‘(a) IN GENERAL.—Within a reasonable
time, but not later than 90 days after the filing
of an application for an order under section
2806 which is granted, the court shall cause
to be served, on the persons named in the
order or the application, and such other par-
ties whose decryption information or whose
plaintext has been provided to an investiga-
tive or law enforcement officer pursuant to
this chapter as the court may determine that
is in the interest of justice, an inventory
which shall include notice of—
øø‘‘(1) the fact of the entry of the
order or the application;
•H.R. 695 RH
øø‘‘(2) the date of the entry of the ap-
plication and issuance of the order; and
øø‘‘(3) the fact that the person’s
decryption information or plaintext data,
including communications, have been
provided or accessed by an investigative
or law enforcement officer.
The court, upon the filing of a motion, may
make available to that person or that person’s
counsel, for inspection, such portions of the
plaintext, applications, and orders as the
court determines to be in the interest of jus-
tice. On an ex parte showing of good cause to
a court of competent jurisdiction, the serving
of the inventory required by this subsection
may be postponed.
øø‘‘(b) ADMISSION
INTO
EVIDENCE.—The
contents of any encrypted information that
has been obtained pursuant to this chapter or
evidence derived therefrom shall not be re-
ceived in evidence or otherwise disclosed in
any trial, hearing, or other proceeding in a
Federal or State court unless each party, not
less than 10 days before the trial, hearing, or
proceeding, has been furnished with a copy of
•H.R. 695 RH
the order, and accompanying application,
under which the decryption or access to
plaintext was authorized or approved. This
10-day period may be waived by the court if
the court finds that it was not possible to fur-
nish the party with the information described
in the preceding sentence within 10 days be-
fore the trial, hearing, or proceeding and that
the party will not be prejudiced by the delay
in receiving such information.
øø‘‘(c) CONTEMPT.—Any violation of the
provisions of this section may be punished by
the court as a contempt thereof.
øø‘‘(d) MOTION
TO
SUPPRESS.—Any ag-
grieved person in any trial, hearing, or pro-
ceeding in or before any court, department,
officer, agency, regulatory body, or other au-
thority of the United States or a State may
move 
to 
suppress 
the 
contents 
of 
any
decrypted data, including communications,
obtained pursuant to this chapter, or evi-
dence derived therefrom, on the grounds
that —
øø‘‘(1) the plaintext was unlawfully
decrypted or accessed;
•H.R. 695 RH
øø‘‘(2) the order of authorization or
approval under which it was decrypted
or accessed is insufficient on its face; or
øø‘‘(3) the decryption was not made in
conformity with the order of authoriza-
tion or approval.
Such motion shall be made before the trial,
hearing, or proceeding unless there was no
opportunity to make such motion, or the per-
son was not aware of the grounds of the mo-
tion. If the motion is granted, the plaintext of
the decrypted data, including communica-
tions, or evidence derived therefrom, shall be
treated as having been obtained in violation
of this chapter. The court, upon the filing of
such motion by the aggrieved person, may
make available to the aggrieved person or
that person’s counsel for inspection such por-
tions of the decrypted plaintext, or evidence
derived therefrom, as the court determines to
be in the interests of justice.
øø‘‘(e) APPEAL BY UNITED STATES.—In addi-
tion to any other right to appeal, the United
States shall have the right to appeal from an
order granting a motion to suppress made
•H.R. 695 RH
under subsection (d), or the denial of an appli-
cation for an order under section 2806, if the
United States attorney certifies to the court
or other official granting such motion or de-
nying such application that the appeal is not
taken for purposes of delay. Such appeal shall
be taken within 30 days after the date the
order was entered on the docket and shall be
diligently prosecuted.
øø‘‘(f) CIVIL ACTION
FOR VIOLATION.—Ex-
cept as otherwise provided in this chapter,
any person described in subsection (g) may in
a civil action recover from the United States
Government the actual damages suffered by
the person as a result of a violation described
in that subsection, reasonable attorney’s fees,
and other litigation costs reasonably incurred
in prosecuting such claim.
øø‘‘(g) COVERED PERSONS.—Subsection (f)
applies to any person whose decryption infor-
mation—
øø‘‘(1) is knowingly obtained without
lawful authority by an investigative or
law enforcement officer;
•H.R. 695 RH
øø‘‘(2) is obtained by an investigative
or law enforcement officer with lawful
authority and is knowingly used or dis-
closed by such officer unlawfully; or
øø‘‘(3) is obtained by an investigative
or law enforcement officer with lawful
authority and whose decryption informa-
tion is unlawfully used to disclose the
plaintext of the data, including commu-
nications.
øø‘‘(h) LIMITATION.—A civil action under
subsection (f) shall be commenced not later
than 2 years after the date on which the un-
lawful action took place, or 2 years after the
date on which the claimant first discovers the
violation, whichever is later.
øø‘‘(i) EXCLUSIVE REMEDIES.—The remedies
and sanctions described in this chapter with
respect to the decryption of data, including
communications, are the only judicial rem-
edies and sanctions for violations of this
chapter involving such decryptions, other
than violations based on the deprivation of
any rights, privileges, or immunities secured
by the Constitution.
•H.R. 695 RH
øø‘‘(j) TECHNICAL ASSISTANCE BY PROVID-
ERS.—A provider of encryption technology or
network service that has received an order is-
sued by a court pursuant to this chapter shall
provide to the investigative or law enforce-
ment officer concerned such technical assist-
ance as is necessary to execute the order.
Such provider may, however, move the court
to modify or quash the order on the ground
that its assistance with respect to the
decryption or access to plaintext cannot be
performed in a timely or reasonable fashion.
The court, upon notice to the Government,
shall decide such motion expeditiously.
øø‘‘(k) REPORTS TO CONGRESS.—In May of
each year, the Attorney General, or an Assist-
ant Attorney General specifically designated
by the Attorney General, shall report in writ-
ing to Congress on the number of applications
made and orders entered authorizing Federal,
State, and local law enforcement access to
decryption information for the purposes of
reading the plaintext of otherwise encrypted
data, including communications, pursuant to
this chapter. Such reports shall be submitted
•H.R. 695 RH
to the Committees on the Judiciary of the
House of Representatives and of the Senate,
and to the Permanent Select Committee on In-
telligence for the House of Representatives
and the Select Committee on Intelligence for
the Senate.
øø‘‘§ 2808. Lawful use of plaintext or decryption infor-
mation
øø‘‘(a) AUTHORIZED USE OF DECRYPTION IN-
FORMATION.—
øø‘‘(1) CRIMINAL
INVESTIGATIONS.—An
investigative or law enforcement officer
to whom plaintext or decryption informa-
tion is provided may use such plaintext
or decryption information for the pur-
poses of conducting a lawful criminal in-
vestigation or foreign counterintelligence
investigation, and for the purposes of
preparing for and prosecuting any crimi-
nal violation of law.
øø‘‘(2) CIVIL
REDRESS.—Any plaintext
or 
decryption 
information 
provided
under this chapter to an investigative or
law enforcement officer may not be dis-
closed, except by court order, to any
•H.R. 695 RH
other person for use in a civil proceeding
that is unrelated to a criminal investiga-
tion and prosecution for which the
plaintext or decryption information is au-
thorized under paragraph (1). Such order
shall only issue upon a showing by the
party seeking disclosure that there is no
alternative 
means 
of 
obtaining 
the
plaintext, 
or 
decryption 
information,
being sought and the court also finds that
the interests of justice would not be
served by nondisclosure.
øø‘‘(b) LIMITATION.—An investigative or
law 
enforcement 
officer 
may 
not 
use
decryption information obtained under this
chapter to determine the plaintext of any
data, including communications, unless it has
obtained lawful authority to obtain such data,
including communications, under other law-
ful authorities.
øø‘‘(c) RETURN
OF DECRYPTION INFORMA-
TION.—An attorney for the Government shall,
upon the issuance of an order of a court of
competent jurisdiction—
•H.R. 695 RH
øø‘‘(1)(A) return any decryption infor-
mation to the person responsible for pro-
viding it to an investigative or law en-
forcement officer pursuant to this chap-
ter; or
øø‘‘(B) destroy such decryption infor-
mation, if the court finds that the inter-
ests of justice or public safety require
that such decryption information should
not be returned to the provider; and
øø‘‘(2) within 10 days after execution
of the court’s order to destroy the
decryption information—
øø‘‘(A) certify to the court that the
decryption information has either
been returned or destroyed consist-
ent with the court’s order; and
øø‘‘(B) notify the provider of the
decryption information of the de-
struction of such information.
øø‘‘(d) OTHER DISCLOSURE OF DECRYPTION
INFORMATION.—Except as otherwise provided
in section 2806, a key recovery agent may not
disclose decryption information stored with
•H.R. 695 RH
the key recovery agent by a person unless the
disclosure is—
øø‘‘(1) to the person, or an authorized
agent thereof;
øø‘‘(2) with the consent of the person,
including pursuant to a contract entered
into with the person;
øø‘‘(3) pursuant to a court order upon
a showing of compelling need for the in-
formation that cannot be accommodated
by any other means if—
øø‘‘(A) the person who supplied
the information is given reasonable
notice, by the person seeking the dis-
closure, of the court proceeding rel-
evant to the issuance of the court
order; and
øø‘‘(B) the person who supplied
the information is afforded the oppor-
tunity to appear in the court proceed-
ing and contest the claim of the per-
son seeking the disclosure;
øø‘‘(4) pursuant to a determination by
a court of competent jurisdiction that an-
other person is lawfully entitled to hold
•H.R. 695 RH
such decryption information, including
determinations arising from legal pro-
ceedings associated with the incapacity,
death, or dissolution of any person; or
øø‘‘(5) otherwise permitted by a provi-
sion of this chapter or otherwise per-
mitted by law.
øø‘‘§ 2809. Identification of decryption information
øø‘‘(a) IDENTIFICATION.—To avoid inadvert-
ent disclosure, any person who provides
decryption information to an investigative or
law enforcement officer pursuant to this
chapter shall specifically identify that part of
the 
material 
provided 
that 
discloses
decryption information as such.
øø‘‘(b) RESPONSIBILITY OF INVESTIGATIVE OR
LAW ENFORCEMENT OFFICER.—The investiga-
tive or law enforcement officer receiving any
decryption information under this chapter
shall maintain such information in facilities
and in a method so as to reasonably assure
that inadvertent disclosure does not occur.
•H.R. 695 RH
øøTITLE II—GOVERNMENT
PROCUREMENT
øøSEC. 201. FEDERAL PURCHASES OF ENCRYPTION PROD-
UCTS.
øøAfter January 1, 1999, any encryption
product or service purchased or otherwise
procured by the United States Government to
provide the security service of data confiden-
tiality for a Federal computer system shall in-
clude 
a 
technique 
enabling 
immediate
decryption by an authorized party without
the knowledge or cooperation of the person
using such encryption products or services.
øøSEC. 202. ENCRYPTION PRODUCTS PURCHASED WITH
FEDERAL FUNDS.
øøAfter January 1, 1999, any encryption
product or service purchased directly with
Federal funds to provide the security service
of data confidentiality shall include a tech-
nique enabling immediate decryption by an
authorized party without the knowledge or
cooperation 
of 
the 
person 
using 
such
encryption product or service unless the Sec-
retary, with the concurrence of the Attorney
General, determines implementing this re-
•H.R. 695 RH
quirement would not promote the purposes of
this Act.
øøSEC. 203. NETWORKS ESTABLISHED WITH FEDERAL
FUNDS.
øøAfter January 1, 1999, any communica-
tions network established with the use of Fed-
eral funds shall use encryption products
which include techniques enabling immediate
decryption by an authorized party without
the knowledge or cooperation of the person
using such encryption products or services
unless the Secretary, with the concurrence of
the Attorney General, determines implement-
ing this requirement would not promote the
purposes of this Act.
øøSEC. 204. PRODUCT LABELS.
øøAn encryption product may be labeled
to inform users that the product is authorized
for sale to or for use in transactions and com-
munications with the United States Govern-
ment under this title.
øøSEC. 205. NO PRIVATE MANDATE.
øøThe United States Government may not
mandate the use of encryption standards for
the private sector other than for use with
•H.R. 695 RH
computer systems, networks, or other systems
of the United States Government, or systems
or networks created using Federal funds.
øøSEC. 206. IMPLEMENTATION.
øø(a) EXCLUSION.—Nothing in this title
shall apply to encryption products and serv-
ices used solely for access control, authentica-
tion, integrity, nonrepudiation, digital signa-
tures, or other similar purposes.
øø(b) RULEMAKING.—The Secretary, in con-
sultation with the Attorney General and other
affected agencies, may through rules provide
for the orderly implementation of this title
and the effective use of secure public net-
works.
øøTITLE III—EXPORTS OF
ENCRYPTION
øøSEC. 301. EXPORTS OF ENCRYPTION.
øø(a) COORDINATION OF EXECUTIVE BRANCH
AGENCIES REQUIRED.—The Secretary, in close
coordination with the Secretary of Defense
and any other executive branch department
or agency with responsibility for protecting
the national security, shall have the authority
to control the export of encryption products
•H.R. 695 RH
not controlled on the United States Munitions
List.
øø(b) DECISIONS NOT SUBJECT TO JUDICIAL
REVIEW.—Decisions made by the Secretary
pursuant to subsection (a) with respect to ex-
ports of encryption products under this title
shall not be subject to judicial review.
øøSEC. 
302. 
LICENSE 
EXCEPTION 
FOR 
CERTAIN
ENCRYPTION PRODUCTS.
øø(a) LICENSE EXCEPTION.—After January
31, 2000, encryption products, without regard
to encryption strength, shall be eligible for ex-
port under a license exception if such
encryption product—
øø(1) is submitted to the Secretary for
a 1-time product review;
øø(2) does not include features or
functions that would otherwise require li-
censing under applicable regulations;
øø(3) is not destined for countries,
end users, or end uses that the Secretary,
in coordination with the Secretary of De-
fense and other executive branch depart-
ments or agencies with responsibility for
protecting the national security, by regu-
•H.R. 695 RH
lation, has determined should be ineli-
gible to receive such products, and is oth-
erwise qualified for export; and
øø(4)(A) includes features or func-
tions providing an immediate access to
plaintext capability, if there is lawful au-
thority for such immediate access; or
øø(B) includes features or functions
providing an immediate decryption capa-
bility of the encrypted data, including
communications, upon the receipt of
decryption information by an authorized
party, and such decryption can be accom-
plished without unauthorized disclosure.
øø(b) ENABLING OF DECRYPTION CAPABILI-
TIES.—The features or functions described in
subsection (a)(4) need not be enabled by the
manufacturer before or at the time of export
for purposes of this title. Such features or
functions may be enabled by the purchaser or
end user.
øø(c) 
RESPONSIBILITIES
OF
THE
SEC-
RETARY.—The Secretary, in close coordination
with the Secretary of Defense and other exec-
utive branch departments or agencies with
•H.R. 695 RH
responsibility for protecting the national se-
curity, shall—
øø(1) specify, by regulation, the infor-
mation that must be submitted for the 1-
time review referred to in this section;
and
øø(2) make all export determinations
under this title within 30 days following
the date of submission to the Secretary
of—
øø(A) the completed application
for a license exception; and
øø(B) the encryption product in-
tended for export that is to be re-
viewed as required by this section.
øø(d) EXERCISE OF OTHER AUTHORITIES.—
The Secretary, and the Secretary of Defense,
may exercise the authorities they have under
other provisions of law, including the Export
Administration Act of 1979, as continued in ef-
fect under the International Emergency Eco-
nomic Powers Act, to carry out this section.
øø(e) PRESUMPTION IN FAVOR OF EXPORTS.—
There shall be a presumption in favor of ex-
port of encryption products under this title.
•H.R. 695 RH
øø(f) WAIVER AUTHORITY.—The President
may by Executive order waive any provision
of this title, or the applicability of any such
provision to a person or entity, if the Presi-
dent determines that the waiver is in the in-
terests of national security or public safety
and security. The President shall submit a re-
port to the relevant committees of the Con-
gress not later than 15 days after such deter-
mination. The report shall include the factual
basis upon which such determination was
made. The report may be in classified format.
øø(g) RELEVANT
COMMITTEES.—The rel-
evant committees of the Congress described
in subsection (f) are the Committee on Inter-
national Relations, the Committee on the Ju-
diciary, the Committee on National Security,
and the Permanent Select Committee on In-
telligence of the House of Representatives,
and the Committee on Foreign Relations, the
Committee on the Judiciary, the Committee
on Armed Services, and the Select Committee
on Intelligence of the Senate.
•H.R. 695 RH
øøSEC. 303. LICENSE EXCEPTION FOR TELECOMMUNI-
CATIONS PRODUCTS.
øøAfter a 1-time review as described in
section 302, the Secretary shall authorize for
export 
under 
a 
license 
exception 
voice
encryption products that do not contain
decryption or access to plainvoice features or
functions otherwise required in section 302, if
the Secretary, after consultation with rel-
evant executive branch departments or agen-
cies, determines that—
øø(1) information recovery require-
ments for such exports would disadvan-
tage United States exporters; and
øø(2) such exports under a license ex-
ception would not create a risk to the for-
eign policy, non-proliferation, or national
security of the United States.
øøSEC. 304. REVIEW FOR CERTAIN INSTITUTIONS.
øøThe Secretary, in consultation with
other executive branch departments or agen-
cies, shall establish a procedure for expedited
review of export license applications involv-
ing encryption products for use by qualified
banks, financial institutions, subsidiaries of
companies owned or controlled by United
•H.R. 695 RH
States persons, or other users specifically au-
thorized by the Secretary.
øøSEC. 305. ENCRYPTION INDUSTRY AND INFORMATION SE-
CURITY BOARD.
øø(a) ENCRYPTION INDUSTRY AND INFORMA-
TION SECURITY BOARD ESTABLISHED.—There is
hereby established an Encryption Industry
and Information Security Board. The Board
shall undertake an advisory role for the Presi-
dent.
øø(b) PURPOSES.—The purposes of the
Board are—
øø(1) to provide a forum to foster
communication 
and 
coordination 
be-
tween industry and the Federal Govern-
ment on matters relating to the use of
encryption products;
øø(2) 
to 
promote 
the 
export 
of
encryption products manufactured in the
United States;
øø(3) to encourage research and de-
velopment of products that will foster
electronic commerce;
øø(4) to recommend policies enhanc-
ing the security of public networks;
•H.R. 695 RH
øø(5) to promote the protection of in-
tellectual property and privacy rights of
individuals using public networks;
øø(6) to enable the United States to
effectively and continually understand
the benefits and risks to its national se-
curity, law enforcement, and public safe-
ty interests by virtue of the proliferation
of strong encryption on the global mar-
ket;
øø(7) to evaluate and make rec-
ommendations regarding the further de-
velopment and use of encryption;
øø(8) to advance the development of
international standards regarding inter-
operability and global use of encryption
products; and
øø(9) to evaluate the foreign availabil-
ity of encryption products and their
threat to United States industry.
øø(c) MEMBERSHIP.—(1) The Board shall be
composed of 13 members, as follows:
øø(A) The Secretary, or the Sec-
retary’s designee, who shall chair the
Board.
•H.R. 695 RH
øø(B) The Attorney General, or the
Director of the Federal Bureau of Inves-
tigation, or a respective designee.
øø(C) The Secretary of Defense, or the
Secretary’s designee.
øø(D) the Director of Central Intel-
ligence, or his or her designee.
øø(E) The Special Assistant to the
President for National Security Affairs,
or his or her designee.
øø(F) Two private sector individuals,
appointed by the President, who have ex-
pertise in consumer and privacy interests
relating to or affected by information se-
curity technology.
øø(G) Six representatives from the
private sector who have expertise in the
development, operation, marketing, law,
or public policy relating to information
security or technology.
øø(2) The six private sector representa-
tives described in paragraph (1)(G) shall be
appointed as follows:
øø(A) Two by the Speaker of the
House of Representatives.
•H.R. 695 RH
øø(B) One by the Minority Leader
of the House of Representatives.
øø(C) Two by the Majority Leader
of the Senate.
øø(D) One by the Minority Leader
of the Senate.
øø(e) MEETINGS.—The Board shall meet at
such times and in such places as the Sec-
retary may prescribe, but not less frequently
than every four months. The Federal Advisory
Committee Act (5 U.S.C. App.) does not apply
to the Board or to meetings held by the Board
under this section.
øø(f) FINDINGS
AND RECOMMENDATIONS.—
The chair of the Board shall convey the find-
ings and recommendations of the Board to the
President and to the Congress within 30 days
after each meeting of the Board. The rec-
ommendations of the Board are not binding
upon the President.
øø(g) FOREIGN AVAILABILITY.—The consid-
eration of foreign availability by the Board
shall include computer software that is dis-
tributed over the Internet or advertised for
sale, license, or transfer, including over-the-
•H.R. 695 RH
counter retail sales, mail order transactions,
telephone order transactions, electronic dis-
tribution, or sale on approval.
øøTITLE IV—LIABILITY
LIMITATIONS
øøSEC. 401. COMPLIANCE WITH COURT ORDER.
øø(a) NO LIABILITY FOR COMPLIANCE.—Sub-
ject to subsection (b), no civil or criminal li-
ability under this Act, or under any other pro-
vision of law, shall attach to any person for
disclosing or providing—
øø(1) the plaintext of encrypted data,
including communications;
øø(2) the decryption information of
such encrypted data, including commu-
nications; or
øø(3) technical assistance for access
to the plaintext of, or decryption informa-
tion for, encrypted data, including com-
munications.
øø(b) EXCEPTION.—Subsection (a) shall not
apply to a person who provides plaintext or
decryption information to another and is not
authorized by court order to disclose such
plaintext or decryption information.
•H.R. 695 RH
øøSEC. 402. COMPLIANCE DEFENSE.
øøCompliance with the provisions of sec-
tions 2806, 2807, 2808, or 2809 of title 18, Unit-
ed States Code, as added by section 104(a) of
this Act, or any regulations authorized there-
under, shall provide a complete defense for
any civil action for damages based upon ac-
tivities covered by this Act, other than an ac-
tion founded on contract.
øøSEC. 403. REASONABLE CARE DEFENSE.
øøThe participation by person in the key
management infrastructure established by
regulation for United States Government in-
formation security operations under section
103 shall be treated as evidence of reasonable
care or due diligence in any proceeding
where the reasonableness of one’s actions is
an element of the claim at issue.
øøSEC. 404. GOOD FAITH DEFENSE.
øøAn objectively reasonable reliance on
the legal authority provided by this Act and
the amendments made by this Act, requiring
or authorizing access to the plaintext of oth-
erwise encrypted data, including communica-
tions, or to the decryption information that
will allow the immediate decryption of data,
•H.R. 695 RH
including communications, that is otherwise
encrypted, shall be a complete defense to any
criminal or civil action that may be brought
under the laws of the United States or any
State.
øøSEC. 405. SOVEREIGN IMMUNITY.
øøExcept as otherwise specifically pro-
vided otherwise, nothing in this Act or the
amendments made by this Act, or any regula-
tions promulgated thereunder, modifies or
amends the sovereign immunity of the United
States.
øøSEC. 406. CIVIL ACTION, GENERALLY.
øøA civil action may be brought against
any person who, regardless of that person’s
participation in the key management infra-
structure to be established by regulations
promulgated by the Secretary pursuant to
section 103, violates or acts in a manner that
is inconsistent with or violates the provisions
or intent of this Act or the amendments made
by this Act.
•H.R. 695 RH
øøTITLE V—INTERNATIONAL
AGREEMENTS
øøSEC. 501. SENSE OF CONGRESS.
øøIt is the sense of Congress that—
øø(1) the President should conduct
negotiations with foreign governments
for the purposes of mutual recognition of
any key management infrastructures, and
their component parts, that exist or are
developed; and
øø(2) such mutual recognition agree-
ments will safeguard the privacy of the
citizens of the United States, prevent eco-
nomic espionage, and enhance the infor-
mation security needs of the United
States.
øøSEC. 502. FAILURE TO NEGOTIATE.
øøThe President may consider a govern-
ment’s refusal to negotiate mutual recogni-
tion agreements described in section 501
when considering the participation of the
United States in any cooperation or assist-
ance program with that country.
•H.R. 695 RH
øøSEC. 503. REPORT TO CONGRESS.
øø(a) REPORT
TO CONGRESS.—The Presi-
dent shall report annually to the Congress on
the status of the international effort outlined
by section 501.
øø(b) FIRST REPORT.—The first report re-
quired under subsection (a) shall be submit-
ted in unclassified form no later than Decem-
ber 15, 1998.
øøTITLE VI—MISCELLANEOUS
PROVISIONS
øøSEC. 601. EFFECT ON LAW ENFORCEMENT ACTIVITIES.
øø(a) COLLECTION OF INFORMATION BY AT-
TORNEY GENERAL.—The Attorney General shall
compile, and maintain in classified form, data
on the instances in which encryption has
interfered with, impeded, or obstructed the
ability of the Department of Justice to enforce
the criminal laws of the United States.
øø(b) AVAILABILITY OF INFORMATION TO THE
CONGRESS.—The information compiled under
subsection (a), including an unclassified sum-
mary thereof, shall be made available, upon
request, to any Member of Congress.
•H.R. 695 RH
øøSEC. 602. INTERPRETATION.
øøNothing contained in this Act or the
amendments made by this Act shall be
deemed to—
øø(1) preempt or otherwise affect the
application of the Arms Export Control
Act (22 U.S.C. 2751 et seq.), the Export
Administration Act of 1979 (50 U.S.C. App.
2401 et seq.), or the International Emer-
gency Economic Powers Act (50 U.S.C.
1701 et seq.) or any regulations promul-
gated thereunder;
øø(2) affect foreign intelligence activi-
ties of the United States; or
øø(3) negate or diminish any intellec-
tual property protections under the laws
of the United States or of any State.
øøSEC. 603. SEVERABILITY.
øøIf any provision of this Act or the
amendments made by this Act, or the applica-
tion thereof, to any person or circumstances
is held invalid by a court of the United States,
the remainder of this Act or such amend-
ments, and the application thereof, to other
persons or circumstances shall not be affected
thereby.¿¿
•H.R. 695 RH
∆SECTION 1. SHORT TITLE.
∆This Act may be cited as the ‘‘Security
and Freedom Through Encryption (SAFE)
Act’’.
∆SEC. 2. SALE AND USE OF ENCRYPTION.
∆(a) IN GENERAL.—Part I of title 18, United
States Code, is amended by inserting after
chapter 123 the following new chapter:
∆‘‘CHAPTER 125—ENCRYPTED WIRE AND
ELECTRONIC INFORMATION
∆‘‘2801. Definitions.
∆‘‘2802. Assistance for law enforcement.
∆‘‘2803. Freedom to sell encryption.
∆‘‘2804. Prohibition on mandatory key escrow.
∆‘‘2805. Unlawful use of encryption in furtherance of a criminal
act.
∆‘‘2806. Liability limitations.
∆‘‘§ 2801. Definitions
∆‘‘As used in this chapter—
∆‘‘(1) the terms ‘person’, ‘State’, ‘wire
communication’, ‘electronic communica-
tion’, and ‘investigative or law enforce-
ment officer’ have the meanings given
those terms in section 2510 of this title;
∆‘‘(2) 
the 
terms 
‘encrypt’ 
and
‘encryption’ refer to the scrambling of
wire communications, electronic commu-
nications, or electronically stored infor-
mation, using mathematical formulas or
•H.R. 695 RH
algorithms in order to preserve the con-
fidentiality, integrity, or authenticity of,
and prevent unauthorized recipients from
accessing or altering, such communica-
tions or information;
∆‘‘(3) the term ‘key’ means the variable
information used in a mathematical for-
mula, code, or algorithm, or any compo-
nent thereof, used to decrypt wire commu-
nications, electronic communications, or
electronically stored information, that
has been encrypted; and
∆‘‘(4) the term ‘United States person’
means—
∆‘‘(A) any United States citizen;
∆‘‘(B) any other person organized
under the laws of any State; and
∆‘‘(C) any person organized under
the laws of any foreign country who is
owned or controlled by individuals or
persons described in subparagraphs
(A) and (B).
∆‘‘§ 2802. Assistance for law enforcement
∆‘‘(a) NATIONAL ELECTRONIC TECHNOLOGIES
CENTER.—
•H.R. 695 RH
∆‘‘(1) ESTABLISHMENT.—There is estab-
lished in the Department of Justice a Na-
tional Electronic Technologies Center (in
this subsection referred to as the ‘NET
Center’).
∆‘‘(2) 
DIRECTOR.—The 
NET 
Center
shall have a Director, who shall be ap-
pointed by the Attorney General.
∆‘‘(3) DUTIES.—The duties of the NET
Center shall be—
∆‘‘(A) to serve as a center for Fed-
eral, State, and local law enforcement
authorities for information and as-
sistance regarding decryption and
other access requirements;
∆‘‘(B) to serve as a center for in-
dustry and government entities to ex-
change information and methodology
regarding information security tech-
niques and technologies;
∆‘‘(C) to examine encryption tech-
niques and methods to facilitate the
ability of law enforcement to gain effi-
cient access to plaintext of commu-
nications and electronic information;
•H.R. 695 RH
∆‘‘(D) to conduct research to de-
velop efficient methods, and improve
the efficiency of existing methods, of
accessing plaintext of communica-
tions and electronic information;
∆‘‘(E) to investigate and research
new and emerging techniques and
technologies to facilitate access to
communications and electronic infor-
mation, including —
∆‘‘(i) reverse-steganography;
∆‘‘(ii) decompression of infor-
mation that previously has been
compressed for transmission; and
∆‘‘(iii) de-multiplexing; and
∆‘‘(F) to obtain information re-
garding the most current hardware,
software, 
telecommunications, 
and
other capabilities to understand how
to 
access 
information 
transmitted
across networks.
∆‘‘(4) EQUAL ACCESS.—State and local
law enforcement agencies and authorities
shall have access to information, services,
resources, and assistance provided by the
•H.R. 695 RH
NET Center to the same extent that Fed-
eral law enforcement agencies and au-
thorities have such access.
∆‘‘(5) PERSONNEL.—The Director may
appoint such personnel as the Director
considers appropriate to carry out the du-
ties of the NET Center.
∆‘‘(6) ASSISTANCE
OF
OTHER
FEDERAL
AGENCIES.—Upon the request of the Direc-
tor of the NET Center, the head of any de-
partment or agency of the Federal Govern-
ment may, to assist the NET Center in car-
rying out its duties under this sub-
section—
∆‘‘(A) detail, on a reimbursable
basis, any of the personnel of such de-
partment or agency to the NET Cen-
ter; and
∆‘‘(B) provide to the NET Center
facilities, information, and other non-
personnel resources.
∆‘‘(7) PRIVATE INDUSTRY ASSISTANCE.—
The NET Center may accept, use, and dis-
pose of gifts, bequests, or devises of money,
services, or property, both real and per-
•H.R. 695 RH
sonal, for the purpose of aiding or facili-
tating the work of the Center. Gifts, be-
quests, or devises of money and proceeds
from sales of other property received as
gifts, bequests, or devises shall be depos-
ited in the Treasury and shall be avail-
able for disbursement upon order of the
Director of the NET Center.
∆‘‘(8) ADVISORY BOARD.—
∆‘‘(A) ESTABLISHMENT.—There is es-
tablished the Advisory Board of the
Strategic NET Center for Excellence
in Information Security (in this para-
graph referred to as the ‘Advisory
Board’), which shall be comprised of
members who have the qualifications
described in subparagraph (B) and
who are appointed by the Attorney
General. The Attorney General shall
appoint a chairman of the Advisory
Board.
∆‘‘(B) QUALIFICATIONS.—Each mem-
ber of the Advisory Board shall have
experience or expertise in the field of
encryption, decryption, electronic com-
•H.R. 695 RH
munication, 
information 
security,
electronic commerce, or law enforce-
ment.
∆‘‘(C) DUTIES.—The duty of the Ad-
visory Board shall be to advise the
NET Center and the Federal Govern-
ment regarding new and emerging
technologies relating to encryption
and decryption of communications
and electronic information.
∆‘‘(9) IMPLEMENTATION PLAN.—Within 2
months after the date of the enactment of
the 
Security 
and 
Freedom 
Through
Encryption (SAFE) Act, the Attorney Gen-
eral shall, in consultation and coopera-
tion with other appropriate Federal agen-
cies and appropriate industry partici-
pants, develop and cause to be published
in the Federal Register a plan for estab-
lishing the NET Center. The plan shall—
∆‘‘(A) specify the physical location
of the NET Center and the equipment,
software, and personnel resources nec-
essary to carry out the duties of the
NET Center under this subsection;
•H.R. 695 RH
∆‘‘(B) assess the amount of fund-
ing necessary to establish and operate
the NET Center; and
∆‘‘(C) identify sources of probable
funding for the NET Center, including
any sources of in-kind contributions
from private industry.
∆‘‘(b) FREEDOM OF USE.—Subject to section
2805, it shall be lawful for any person within
any State, and for any United States person in
a foreign country, to use any encryption, re-
gardless of the encryption algorithm selected,
encryption key length chosen, or implementa-
tion technique or medium used. No Federal or
State law or regulation may condition the is-
suance of certificates of authentication or cer-
tificates of authority for any encryption prod-
uct upon any escrowing or other sharing of
private encryption keys, whether with private
agents or government entities, or establish a li-
censing, labeling, or other regulatory scheme
for any encryption product that requires key
escrow as a condition of licensing or regu-
latory approval.
•H.R. 695 RH
∆‘‘§ 2803. Freedom to sell encryption
∆‘‘Subject to section 2805, it shall be lawful
for any person within any State to sell in inter-
state commerce any encryption, regardless of
the encryption algorithm selected, encryption
key length chosen, or implementation tech-
nique or medium used.
∆‘‘§ 2804. Prohibition on mandatory key escrow
∆‘‘(a) PROHIBITION.—No person in lawful
possession of a key to encrypted communica-
tions or information may be required by Fed-
eral or State law to relinquish to another per-
son control of that key.
∆‘‘(b) EXCEPTION FOR ACCESS FOR LAW EN-
FORCEMENT PURPOSES.—Subsection (a) shall
not affect the authority of any investigative or
law enforcement officer, or any member of the
intelligence community as defined in section 3
of the National Security Act of 1947 (50 U.S.C.
401a), acting under any law in effect on the ef-
fective date of this chapter, to gain access to
encrypted communications or information.
∆‘‘§ 2805. Unlawful use of encryption in furtherance of
a criminal act
∆‘‘Any person who, in the commission of a
felony under a criminal statute of the United
100
•H.R. 695 RH
States, knowingly and willfully encrypts in-
criminating communications or information
relating to that felony with the intent to con-
ceal such communications or information for
the purpose of avoiding detection by law en-
forcement agencies or prosecution—
∆‘‘(1) in the case of a first offense
under this section, shall be imprisoned for
not more than 10 years, or fined in the
amount set forth in this title, or both; and
∆‘‘(2) in the case of a second or subse-
quent offense under this section, shall be
imprisoned for not more than 20 years, or
fined in the amount set forth in this title,
or both.
∆‘‘§ 2806. Liability limitations
∆‘‘No person shall be subject to civil or
criminal liability for providing access to the
plaintext of encrypted communications or elec-
tronic information to any law enforcement of-
ficial or authorized government entity, pursu-
ant to judicial process.’’.
∆(b) STUDY.—Within 6 months after the
date of the enactment of this Act, the National
Telecommunications and Information Admin-
101
•H.R. 695 RH
istration shall conduct a study, and prepare
and submit to the Congress and the President
a report regarding such study, that—
∆(1) assesses the effect that establish-
ment of a mandatory system for recovery
of encryption keys for encrypted commu-
nications and information would have
on—
∆(A) electronic commerce;
∆(B) data security;
∆(C) privacy in interstate com-
merce; and
∆(D) law enforcement authorities
and activities; and
∆(2) assesses other possible methods
for providing access to encrypted commu-
nications and information to further law
enforcement activities.
∆(c) CONFORMING AMENDMENT.—The table
of chapters for part I of title 18, United States
Code, is amended by inserting after the item
relating to chapter 123 the following new item:
∆‘‘125. Encrypted wire and electronic information .............. 2801’’.
∆SEC. 3. EXPORTS OF ENCRYPTION.
∆(a) AMENDMENT
TO EXPORT ADMINISTRA-
TION ACT OF 1979.—Section 17 of the Export Ad-
102
•H.R. 695 RH
ministration Act of 1979 (50 U.S.C. App. 2416)
is amended by adding at the end thereof the
following new subsection:
∆‘‘(g) COMPUTERS
AND
RELATED
EQUIP-
MENT.—
∆‘‘(1) GENERAL RULE.—Subject to para-
graphs (2), (3), and (4), the Secretary
shall have exclusive authority to control
exports of all computer hardware, soft-
ware, and technology for information se-
curity (including encryption), except that
which is specifically designed or modified
for military use, including command, con-
trol, and intelligence applications.
∆‘‘(2) ITEMS NOT REQUIRING LICENSES.—
No validated license may be required, ex-
cept pursuant to the Trading With The
Enemy Act or the International Emer-
gency Economic Powers Act (but only to
the extent that the authority of such Act is
not exercised to extend controls imposed
under this Act), for the export or reexport
of—
∆‘‘(A) any software, including soft-
ware with encryption capabilities—
103
•H.R. 695 RH
∆‘‘(i) that is generally avail-
able, as is, and is designed for in-
stallation by the purchaser; or
∆‘‘(ii) that is in the public do-
main for which copyright or other
protection is not available under
title 17, United States Code, or
that is available to the public be-
cause it is generally accessible to
the interested public in any form;
or
∆‘‘(B) any computing device solely
because it incorporates or employs in
any form software (including software
with encryption capabilities) exempt-
ed from any requirement for a vali-
dated license under subparagraph
(A).
∆‘‘(3) SOFTWARE WITH ENCRYPTION CAPA-
BILITIES.—The Secretary shall authorize
the export or reexport of software with
encryption capabilities for nonmilitary
end uses in any country to which exports
of software of similar capability are per-
mitted for use by financial institutions
104
•H.R. 695 RH
not controlled in fact by United States
persons, unless there is substantial evi-
dence that such software will be—
∆‘‘(A) diverted to a military end
use or an end use supporting inter-
national terrorism;
∆‘‘(B) modified for military or ter-
rorist end use; or
∆‘‘(C) reexported without any au-
thorization by the United States that
may be required under this Act.
∆‘‘(4) HARDWARE WITH ENCRYPTION CA-
PABILITIES.—The Secretary shall authorize
the export or reexport of computer hard-
ware with encryption capabilities if the
Secretary determines that a product offer-
ing comparable security is commercially
available outside the United States from a
foreign supplier, without effective restric-
tions.
∆‘‘(5) DEFINITIONS.—As used in this
subsection—
∆‘‘(A) the term ‘encryption’ means
the scrambling of wire or electronic
information using mathematical for-
105
•H.R. 695 RH
mulas or algorithms in order to pre-
serve the confidentiality, integrity, or
authenticity of, and prevent unauthor-
ized recipients from accessing or al-
tering, such information;
∆‘‘(B) the term ‘generally avail-
able’ means, in the case of software
(including software with encryption
capabilities), software that is offered
for sale, license, or transfer to any
person without restriction, whether or
not for consideration, including, but
not limited to, over-the-counter retail
sales, mail order transactions, phone
order 
transactions, 
electronic 
dis-
tribution, or sale on approval;
∆‘‘(C) the term ‘as is’ means, in the
case of software (including software
with encryption capabilities), a soft-
ware program that is not designed,
developed, or tailored by the software
publisher for specific purchasers, ex-
cept that such purchasers may supply
certain installation parameters need-
ed by the software program to func-
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tion properly with the purchaser’s sys-
tem and may customize the software
program by choosing among options
contained in the software program;
∆‘‘(D) the term ‘is designed for in-
stallation by the purchaser’ means, in
the case of software (including soft-
ware with encryption capabilities)
that—
∆‘‘(i) the software publisher in-
tends for the purchaser (including
any licensee or transferee), who
may not be the actual program
user, to install the software pro-
gram on a computing device and
has supplied the necessary in-
structions to do so, except that the
publisher may also provide tele-
phone help line services for soft-
ware 
installation, 
electronic
transmission, or basic operations;
and
∆‘‘(ii) the software program is
designed for installation by the
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purchaser without further sub-
stantial support by the supplier;
∆‘‘(E) the term ‘computing device’
means a device which incorporates
one 
or 
more 
microprocessor-based
central processing units that can ac-
cept, store, process, or provide output
of data; and
∆‘‘(F) the term ‘computer hard-
ware’, when used in conjunction with
information security, includes, but is
not 
limited 
to, 
computer 
systems,
equipment, 
application-specific 
as-
semblies, modules, and integrated cir-
cuits.’’.
∆(b) CONTINUATION OF EXPORT ADMINISTRA-
TION ACT.—For purposes of carrying out the
amendment made by subsection (a), the Export
Administration Act of 1979 shall be deemed to
be in effect.
∆SEC. 4. TREATMENT OF ENCRYPTION IN INTERSTATE AND
FOREIGN COMMERCE.
∆(a) INQUIRY REGARDING IMPEDIMENTS TO
TRADE.—Within 180 days after the date of the
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enactment of this Act, the Secretary of Com-
merce shall complete an inquiry to—
∆(1) identify any domestic and foreign
impediments to trade in encryption prod-
ucts and services and the manners in
which and extent to which such impedi-
ments inhibit the development of inter-
state and foreign commerce; and
∆(2) identify import restrictions im-
posed by foreign nations that constitute
unfair trade barriers to providers of
encryption products or services.
The Secretary shall submit a report to the Con-
gress regarding the results of such inquiry by
such date.
∆(b) REMOVAL OF IMPEDIMENTS TO TRADE.—
Within 1 year after such date of enactment, the
Secretary of Commerce, in consultation with
the Attorney General, shall prescribe such reg-
ulations as may be necessary to reduce the im-
pediments to trade in encryption products and
services identified in the inquiry pursuant to
subsection (a) for the purpose of facilitating
the development of interstate and foreign com-
merce. Such regulations shall be designed to—
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∆(1) promote the sale and distribution
in foreign commerce of encryption prod-
ucts and services manufactured in the
United States; and
∆(2) strengthen the competitiveness of
domestic providers of encryption products
and services in foreign commerce.
∆(c) INTERNATIONAL AGREEMENTS.—
∆(1) REPORT TO PRESIDENT.—Upon the
completion of the inquiry under sub-
section (a), the Secretary of Commerce
shall submit a report to the President re-
garding reducing any impediments to
trade in encryption products and services
that are identified by the inquiry and
could, in the determination of the Sec-
retary, require international negotiations
for such reduction.
∆(2) 
NEGOTIATIONS.—The 
President
shall take all actions necessary to con-
duct negotiations with other countries for
the purposes of (A) concluding inter-
national agreements on the promotion of
encryption products and services, and (B)
achieving mutual recognition of coun-
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tries’ export controls, in order to meet the
needs of countries to preserve national se-
curity, safeguard privacy, and prevent
commercial espionage. The President may
consider a country’s refusal to negotiate
such international export and mutual rec-
ognition agreements when considering the
participation of the United States in any
cooperation or assistance program with
that country. The President shall submit
a report to the Congress regarding the
status of international efforts regarding
cryptography not later than December 31,
2000.
∆(d) DEFINITIONS.—For purposes of this
section, the following definitions shall apply:
∆(1) COMMUNICATION.—The term ‘‘com-
munication’’ includes wire communica-
tion and electronic communication.
∆(2) DECRYPT; DECRYPTION.—The terms
‘‘decrypt’’ and ‘‘decryption’’ refer to the
electronic retransformation of commu-
nications or electronically stored informa-
tion that has been encrypted into the
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original form of the communication or in-
formation.
∆(3) ELECTRONIC COMMUNICATION.—The
term ‘‘electronic communication’’ has the
meaning given such term in section 2510
of title 18, United States Code.
∆(4) ENCRYPT; ENCRYPTION.—The terms
‘‘encrypt’’ 
and 
‘‘encryption’’ 
have 
the
meanings given such terms in section 2801
of title 18, United States Code (as added
by section 2 of this Act).
∆(5) ENCRYPTION PRODUCT.—The term
‘‘encryption product’’ means any product,
software, or technology that can be used
to encrypt and decrypt communications or
electronic information and any product,
software, or technology with encryption
capabilities;
∆(6) WIRE
COMMUNICATION.—The term
‘‘wire communication’’ has the meaning
given such term in section 3 of the Com-
munications Act of 1934 (47 U.S.C. 153).
∆SEC. 5. EFFECT ON LAW ENFORCEMENT ACTIVITIES.
∆(a) COLLECTION
OF INFORMATION
BY AT-
TORNEY GENERAL.—The Attorney General shall
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compile, and maintain in classified form, data
on the instances in which encryption (as de-
fined in section 2801 of title 18, United States
Code) has interfered with, impeded, or ob-
structed the ability of the Department of Jus-
tice to enforce the criminal laws of the United
States.
∆(b) AVAILABILITY OF INFORMATION TO THE
CONGRESS.—The information compiled under
subsection (a), including an unclassified sum-
mary thereof, shall be made available, upon
request, to any Member of Congress.«
Amend the title so as to read: ‘‘A bill to amend title
18, United States Code, to affirm the rights of United
States persons to use and sell encryption.’’.