U.S. Relaxes Data-Scrambling Export Rules

The Clinton administration enacted more lenient rules on the export of powerful data-scrambling technology, used to guarantee privacy of e-mail and credit card sales over the Internet. But critics complained that the relaxed restrictions still leave sensitive data vulnerable to dedicated hackers with sufficient financial resources. The new rules from the Commerce Department allow U.S. companies to sell high-tech tools overseas that use the so-called 56-bit Data Encryption Standard or its equivalent, which has an unlocking key with 72 quadrillion possible combinations. The rules also eliminate restrictions on selling data-scrambling products to U.S. subsidiaries overseas, and even more powerful products can be sold in 46 countries to some industries, such as insurance and health care. The government imposes limits on exports of the most powerful scrambling technology--now anything above 56-bit--because it fears that authorities, even with a judge’s permission, won’t be able to read the messages of criminals or terrorists. The administration previously limited the export of 40-bit encryption technology, which has more than 1 trillion combinations.