Naive Export Question

Given that:
1. It is legal to export books with printed source code.
2. It is legal for foreigners to type it in.
3. It is legal for foreigners to post what they typed.
4. It is legal to pay foreigners to type things into a computer.

It seems to me that it would be legal for the author of a book with
source code to pay foreigners to type in the code and post it.  The
cost of doing so is small compared to the cost of writing and
publishing the book.

I assume that this is illegal, but which laws does it violate?

Peter Hendrickson
ph@netcom.com

At 11:07 PM -0800 1/3/97, Peter Hendrickson wrote:
>Given that:
>1. It is legal to export books with printed source code.
>2. It is legal for foreigners to type it in.
>3. It is legal for foreigners to post what they typed.
>4. It is legal to pay foreigners to type things into a computer.
>
>It seems to me that it would be legal for the author of a book with
>source code to pay foreigners to type in the code and post it.  The
>cost of doing so is small compared to the cost of writing and
>publishing the book.
>
>I assume that this is illegal, but which laws does it violate?


This is known as "structuring," as with structuring of funds transfers with
the apparent intent of avoiding certain laws.

(Not really, but I would not be surprised if the courts give some latitude
to prosecutions along these lines, or if specific language is eventually
added to make such circumventions a felony.)

All in all, as the various posts about Bernstein, Karn, OCR, the MIT Press
version of PGP, etc. have shown, attempting to block cryptographic code
from leaving the U.S. is a lost cause, for many reasons.

On a related topic, my hunch is that it is much more likely for a
prosecution to involve a major software company skirting the ITAR/EAR rules
by subcontracting with offshore companies (e.g., RSADSI using the NEC
chips, or Cylink using Israeli programmers) than it is that some lowly Net
person will be proscuted for dribbling out a few hundred lines of some
crypto program.

--Tim May

Just say "No" to "Big Brother Inside"
We got computers, we're tapping phone lines, I know that that ain't allowed.
---------:---------:---------:---------:---------:---------:---------:----
Timothy C. May              | Crypto Anarchy: encryption, digital money,
tcmay@got.net  408-728-0152 | anonymous networks, digital pseudonyms, zero
W.A.S.T.E.: Corralitos, CA  | knowledge, reputations, information markets,
Higher Power: 2^1398269     | black markets, collapse of governments.
"National borders aren't even speed bumps on the information superhighway."

Timothy C. May wrote:

| On a related topic, my hunch is that it is much more likely for a
| prosecution to involve a major software company skirting the ITAR/EAR rules
| by subcontracting with offshore companies (e.g., RSADSI using the NEC
| chips, or Cylink using Israeli programmers) than it is that some lowly Net
| person will be proscuted for dribbling out a few hundred lines of some
| crypto program.

	I doubt it.  People are often much more resource poor than
companies.  A company with the prospect of a few million in sales can
defend itself in court much better than some individual.  The ITARs
survive on FUD, not strong legal basis.

Adam



-- 
"It is seldom that liberty of any kind is lost all at once."
					               -Hume

On Fri, 3 Jan 1997, Peter Hendrickson wrote:

> Given that:
> 1. It is legal to export books with printed source code.
> 2. It is legal for foreigners to type it in.
> 3. It is legal for foreigners to post what they typed.
> 4. It is legal to pay foreigners to type things into a computer.
> 
> It seems to me that it would be legal for the author of a book with
> source code to pay foreigners to type in the code and post it.  The
> cost of doing so is small compared to the cost of writing and
> publishing the book.

It would probably be chased down under the `financing foreign crypto'
bits...

> I assume that this is illegal, but which laws does it violate?

And here we have the heart of the regulations...  Only _actually_ close
what they're sure they can get away with, but make sure to make it
seem that the rules are logical and complete, so people will refrain
from exporting crypto legally or illegally for fear that they will
break the law without meaning too...

--
				Jim Wise
				jim@santafe.arch.columbia.edu
				http://www.arch.columbia.edu/~jim
				* Finger for PGP public key *