Congress shapes high-tech, Net policy

Creating new Internet and technology laws is no longer a fad for Congress--it has become an institution.

From regulating technologies that ensure private online communication to new laws for protecting copyrights in the digital age, federal lawmakers were inundated with proposals concerning the high-tech industries and Net users before wrapping up the congressional session in November.

On top of those, a pile of technology-related legislation will be waiting for Congress when it reconvenes in January. Members in both houses will grapple over bills that limit Net taxation, ban online casinos, and slap stiff penalties on those who supply minors with digital material deemed "harmful."

While the outcome of these proposals is difficult to predict, one thing is certain: The fruition of the Net and the high-tech industries' standing as a major U.S. economic force have made the areas main targets for Congress.

Prime candidates for legislation are high-priced vices such as Net gambling and pornography, which have secured their positions on members' radar. Both will be taken up when Congress returns from the break.

The Internet Gambling Prohibition Act would amend the federal Wire Act to include the Net, making it illegal to place or accept wagers over telephone wires. Foes of the bill told CNET's NEWS.COM that they are drafting legislation to counter the growing antigambling movement.

"We're trying to find an alternative that can be proposed that is not a straight-out prohibition," said Sue Schneider, editor of gambling e-zine Rolling Good Times OnLine. "Large countries like Australia are moving forward toward legalizing and licensing Internet gambling. The hope is for a separate piece of legislation."

The primary Republican sponsor of the now-defunct Communications Decency Act also is pushing a measure to prohibit commercial Web sites from distributing to those under age 17 any material that is "harmful to minors," such as sexually explicit messages or Web sites.

Not as sexy, but just as controversial, is the ongoing encryption debate that has spilled over into next year, and will be high on Congress's agenda. In the past few months, the battle over White House export limits on strong crypto products, which in effect scramble digital messages from being read by unintended recipients, was overshadowed by national security agencies' push for domestic controls. Law enforcement wants quick access to U.S. residents' secure electronic messages during criminal investigations.

"The battle over encryption policy reform has now shifted from export relief to whether we will have domestic encryption controls," said Jonah Seiger, a policy analyst at the Center for Democracy and Technology. The organization has pushed for the passage of Rep. Bob Goodlatte's (R-Virginia) so-called SAFE Act, which will overturn federal limits on the strength of encryption that can be exported by U.S. software makers.

But SAFE is being countered by legislation originally floated by the Clinton administration to require that most networks build a "key recovery" system into their encryption programs. This means law enforcement could get easy access to the keys that decode encrypted messages.

Moreover, a provision buried in the House Intelligence Committee's version of SAFE significantly altered the bill so that it bans the domestic sale or use of encryption that doesn't provide "duly authorized persons immediate access" to the keys or plain text of encrypted messages. Violators could be sentenced to up to five years in prison.

In fact, there are currently five versions of SAFE in the House that aim to reshape the bill in one way or another. The National Security Committee amended SAFE to let the president waive any portion of the act, if it passes. For now, the bill that passed the Judiciary Committee is closest to what Goodlatte originally proposed. Despite some committee victories for the software industry and privacy groups, it is still unclear whose campaign will win.

"We oppose any version of SAFE that would have domestic controls," Seiger added.

Another hot-button topic facing Congress is online copyright.

Already a series of hearings have been held on the WIPO Copyright and Performances and Phonograms Treaty Implementation Act, introduced by Rep. Howard Coble (R-North Carolina) and Sen. Orrin Hatch (R-Utah). The bill would ratify international treaties to protect copyrights in cyberspace as signed at the World Intellectual Property Organization's 1996 diplomatic conference.

"The two biggies, of course, are the enabling legislation for the WIPO copyright bills, and Sen. John Ashcroft's legislation that clarifies ISPs' liability when it comes to infringement," said Dave McClure, executive director of the Association of Online Professionals.

"We want to have liability placed on the people who violate the copyright, not the ISP. That is not made clear in the WIPO implementation legislation," he added.

Goodlatte's No Electronic Theft Act is awaiting President Clinton's signature. If passed, online pirates of software, music, video, or literature could get up to five years in prison and a $250,000 fine for a felony offense, which is defined as "willfully" making or possessing ten or more illegal copies with a retail value of $2,500 or more.

Groups such as the Association for Computing's U.S. Public Policy Committee are pleading with the president to veto the bill. They argue that scientists and educators would be committing federal crimes under the act for simply sharing articles on the Net with students and others.

Another bill with a strong chance of hitting Clinton's "in-box" is the Internet Tax Freedom Act.

The proposal has passed critical committees in both the Senate and House, and would place a six-year ban on states and localities passing new taxes specifically aimed at online access, e-commerce, and other Net services. Many local lawmakers have lobbied against the effort on grounds that it hinders states' rights to create new revenue streams.

"We think the Net Tax Freedom Act is going to pass. But we have to continue our efforts to gain support at the state level," McClure added.  

Go to: Encryption and personal data