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Gleiss Lutz Hootz Hirsch & Partners, Frankfurt

Translation copyright 1996 Christopher Kuner. Reproduction is permitted, provided that this translator's note, including the above copyright notice, is retained in its entirety.

Commentary: Contrary to the impression often given by US government spokesmen that sentiment in foreign countries favors key escrow, German business has taken a consistent position against mandatory "key escrow" and the regulation of cryptography. The following translations of statements released by major German companies and business organizations illustrate the opposition of German business to crypto regulation. The German branch of the ICC has also prepared a "Draft Working Paper on Crypto Policy", a translation of which is available on this site.

Statement by the Bundesverband der Deutschen Industrie e.V. (BDI)

October 15, 1996

Commentary: The following is part of a statement on the draft digital signature law issued by the Bundesverband der Deutschen Industrie e.V. (BDI), the main trade association of German industry. Only the paragraphs dealing with encryption are translated here.

"No prohibition of encryption

In addition, it is important for industry that no regulations on encryption be subsequently submitted. A later legal prohibition on encryption would not only stand in opposition to the purpose of the digital signature law, but would not correspond with the interest of business in protecting computerized data transmissions from third parties."

Statement by the Daimler-Benz Group

December 1, 1996

Commentary: A statement on the German draft "Multimedia Law" was released by Daimler-Benz, the largest industrial group in Europe, on December 1, 1996. The statement was signed by Dr. Alfred Bullesbach, the main data protection officer for the Daimler-Benz group, and Dr. Joachim Riess. Only the paragraph dealing with cryptography regulation is translated here.

"Procedures for digital signatures are dependent on cryptographic procedures. Cryptographic procedures are becoming one of the basic technologies both for the protection of authenticity and integrity and for protection of the confidentiality of electronic documents in telecommunications. The use of such procedures should be possible on a worldwide basis without restriction. Legal, technical and political restrictions on the use of such procedures hinder the further development of such technologies and improvement in the security of telecommunications procedures. A restriction on the use of cryptographic procedures for reasons of domestic or foreign security is practically impossible, since such procedures have been published and are available. Regulation of the use of cryptographic procedures for the purpose of only permitting such procedures which allow decryption also for third parties is not suited for the effective control of possible criminal or subversive communication. The use of unapproved but secure procedures could practically not be controlled. On the other hand, those using approved procedures could not really depend on the confidentiality of communication. In addition, such regulation would hinder technical development, restrict the provision of services, effectively weaken trust in the security of electronic communication, and hinder secure, international electronic communication. The real goal should be to pursue a European policy which does away with existing barriers on the use of cryptographic procedures."

Statement by Teletrust e.V.

February 12, 1997

Commentary: The following statement was released by Teletrust, a German industry group concerned with security in electronic communications, and which includes as its members many of the leading German companies active in the area of cryptography and digital signatures. The statement was released by the "Committee on the Legal aspects of Binding Communication", and is signed by four members of the Committee: Dr. Johann Bizer, a law professor at the University of Frankfurt; Paul Mertes of Deutsche Telekom AG, Dr. Joachim Riess of debis Systemhaus (Chairman of the Committee); and Prof. Dr. Alexander Rossnagel of the University of Kassel.

"Governmental restrictions on the production, supply, and use of cryptographic procedures used to protect the confidentiality of information and messages in communications systems would violate the civil rights of economic development under Art. 12, para. 1 and Art. 2, para. 1 of the German Basic Law, of the confidentiality of communication under Art. 10 of the Basic Law, and of informational self-determination under Art. 2, para. 1 and Art. 1, para. 1 of the Basic Law.

Legal rules which only allow those cryptographic procedures that permit access by the criminal and security authorities or provide for the deposit of a copy of all keys and similar procedures are not proportional. They are not suited for effective protection of the legally-protected values of internal security. Cryptographic procedures are distributed worldwide (e.g. over the Internet) and can be accessed freely at little cost. Thus, even the (small) group which is subject to legal wiretapping has access at any time to encryption procedures which cannot be decrypted, which possibility cannot be prevented.

Even the fact that a message is encrypted can be effectively hidden both from third parties and from government security authorities by the use of steganographic procedures. The use of non-permitted encryption procedures cannot be effectively prosecuted. In view of the legitimate and constitutionally-protected interests in protecting one's private or business messages against the risk of being wiretapped, there are narrow constitutional limits placed on legal rules which would subject the use of cryptographic procedures to criminal penalties. Corresponding provisions of criminal law are, therefore, constitutionally invalid owing to the lack of certainty. Governmental restrictions on the use of specific cryptographic procedures thus have practically no deterrent effect.

In view of their obvious inappropriateness, procedures which oblige manufacturers and sellers to keep duplicates of private decryption keys as a precaution for possible governmental wiretapping violate the prohibition of excessiveness. Storing keys in advance or other procedures by which third parties could access encrypted documents would on the whole make cryptographic procedures insecure. The trust of customers and users in such procedures would also thereby be severely weakened, which would have negative effects on the market for services in this area. This would also criminalize the use of cryptographic procedures which were not controlled or monitored by the State, and would lead to the creation of a black market for such products.

A restriction on cryptographic procedures is unconstitutional because of the unproportional economic expenditure which would have to be made by producers and sellers of security technologies in order to develop and provide the necessary technical and organisational requirements for key management, which measures at the same time are not suited for effective protection of domestic security.

Citizens, consumers, and business, including also many users who are obligated to observe professional secrecy, have a constitutionally-protected interest to communicate confidentially. But cryptographic procedures serve not only the protection of confidential communication (encryption), but also legal certainty (digital signatures). Governmental restrictions on cryptographic procedures would be out of proportion to the risks and damages for confidential and legally-certain communication which would arise. Moreover, any legislative initiative which restricted cryptography would stand in opposition to efforts to make Germany attractive as a place to do business with regard to new information technologies."

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The article is correct to the best of our knowledge at the time of publication. However, the legal situation at the administrative practice of the Regulatory Authority may be subject to changes. Therefore, the article is only a general guide. Specialist advise has to be sought as regards your specific circumstances.