The Hill Times
Monday, February 22, 1999

Digital revolution stirs debate on cryptographic technology

Cryptography's military origins at centre of debate in
international community under the Wassenaar Arrangement

by Richard Madan

Once upon a time, documents were secured by locking filing cabinets and sealing envelopes. But since the advent of the "digital revolution", a new security mechanism has become the industry standard: cryptographic technology.

Through the use of cryptography, information stored and transmitted via computers can be protected against intruders by attaching a "scrambled" series of mathematical codes to each transmission to maintain privacy. Whether it's electronic mail, financial transactions, tax returns, or national security issues, governments and businesses are using the technology to ensure information travelling through network lines is not intercepted by a third party.

Although cryptography technology has been adapted for commercial and consumer transactions, its military origins are currently the centre of debate with the international community under the Wassenaar Arrangement -- an international collaboration to monitor and control exports of military weapons and technologies -- of which Canada is a participant.

And because cryptography was originally developed by the military during the Cold War to keep electronic transmissions classified, it falls under the agreement. As a result, companies that produce the technology are prohibited to export products above department-deemed minimal standards. Some analysts predict the eventual outcome will be developed and nations that have the technology will be unable to help those developing nations that desperately require it.

Electronic Frontier Canada, a group proclaiming themselves as defenders of civil liberties and human rights on the Internet, says cryptography is a defensive technology that protects sensitive personal, medical, and financial information, and there's no reason why it should be restricted under an international arms control agreement.

According to David Jones, the president of EFC and a computer scientist at McMaster University, advanced cryptography is essential to keep the commercial Internet secure, and controlling it will have a terrible effect on on-line computer security.

"We need restrictions on the use of cryptography eliminated", he said.

Under current regulations, Canadian cryptography marketers can only export products that contain an encryption formula less than 56 bits, well below today's industry standards.

"The whole purpose of encryption is so computer hackers can't break the codes. If there's a company that has an encryption product that's known to be weak, who would buy it? But it's only the ones that are known to be weak are the ones allowed to be exported [under the agreement]", he said.

Dr. Jones cited Canada's domestic Cryptography Policy, announced by Industry Minister John Manley (Ottawa South, Ont.) in October last year, clarified the rules allowing essentially a free-flow of the technology domestically. Dr. Jones participated in the industry round table that developed the policy framework and submitted a report calling for deregulations to the system in March, 1998.

However, when it comes to Canadian cryptography exporters, there is still mass uncertainty in the marketplace due to outdated agreements, he said.

In response, Liberal MP Walt Lastewka (St. Catharines, Ont.), who is the Parliamentary secretary to the minister of industry, says the House Industry Committee is addressing cryptography concerns as they review Bill C-54, a bill addressing this and other electronic commerce issues.

"The [Industry] committee has gone into overtime, meeting extra days a week to hear all the witnesses, to hear from everybody -- consumer groups and so-forth," he said.

"Technology is moving so fast that if we don't do something immediately, it'll be hard for us to get our arms around it. By not putting some form of legislation in place, it will be a detriment to us."

Due to its scope, Bill C-54 is projected to stay with the Industry Committee at least until the end of March. It's also expected the cryptography conflict within the Wassenaar Arrangement will be studied as well.

Copyright © 1999 by The Hill Times. All Rights Reserved. Reprinted with permission.