ACCESSION NUMBER:00000
FILE ID:97072301.ECO
DATE:07/23/97
TITLE:23-07-97  ENCRYPTION EXPORT DEREGULATION BILL ADVANCES IN HOUSE

TEXT:
(Bills on trademarks, Mexican duties also move)  (500)
By Bruce Odessey
USIA Staff Writer

Washington -- A bill that would overturn Clinton administration policy
on encryption software export controls has advanced further in the
House of Representatives.

The bill approved by voice vote July 22 in the House International
Relations Committee would essentially eliminate controls on encryption
software, which uses mathematical formulas to scramble electronic
communications.

By 13-22 the committee rejected an amendment offered by its own
chairman, New York Republican Benjamin Gilman, that would have allowed
the president to waive provisions of the bill for national security
reasons.

The bill was already approved in the House Judiciary Committee in May,
but before it goes for a vote in the full House, the National
Security, Commerce and Intelligence committees could also claim
jurisdiction to consider portions of it.

Under Clinton administration policy of October 1996, U.S. companies
can get licenses to export encryption software up to a level of 56
bits, but only if they pledge to work on developing key recovery
systems, or systems that unscramble the scrambled data, for the
market.

Law enforcement and intelligence agencies want the ability, under
court order, to use key recovery systems to collect information the
same way they use wiretaps now.

Those agencies oppose the House bill, arguing it would harm public
safety, but supporters of the bill argue that current policy is
harming U.S. industry's ability to compete in the global market.

A compromise bill having administration support was approved in the
Senate Commerce Committee in June, but supporters of complete
deregulation there could challenge that bill in another committee or
on the Senate floor.

Both the House and Senate must pass a bill before it goes to President
Clinton for his signature or veto. No bill is likely to reach the
floor of the House or Senate soon.

In another trade-related development, the full House voted 425-0 July
22 to pass a law implementing the Trademark Law Treaty, which
harmonizes procedures of national trademark offices.

The treaty establishes maximum requirements a member state can impose
for trademark applications or for granting filing dates and eliminates
many formal requirements like the legalization of signatures on
documents.

In another development, the Senate passed the Treasury appropriations
bill, which included an amendment related to the North American Free
Trade Agreement (NAFTA).

The amendment concerns the disparity between the United States, which
allows U.S. residents duty-free exemption on goods they bring home
from foreign travel valued up to $400, and Mexico, which allows its
residents residing within 25 kilometers of the border an exemption on
goods up to only $50.

The amendment would direct the administration to begin discussions
with Mexican and Canadian officials to achieve NAFTA parity on
duty-free allowance and would require the administration to submit a
legislative remedy if the dispute was unresolved after six months.
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