Government calls for swift decision on Crypto export licences

Manipulated devices were sold to more than 100 countries for spying purposes Keystone / Ennio Leanza

The Swiss government has instructed the State Secretariat for Economic Affairs (SECO) to examine and approve the suspended export applications for encryption devices and modules in connection with the Crypto spying affair, provided the relevant requirements are met.

This is in response to the suspension of the criminal proceedingsExternal link by the Office of the Attorney General of Switzerland (OAG).

For decades Crypto, a Zug-based communications encryption firm, allegedly sold these secretly manipulated devices to more than 100 countries for spying purposes. Until 2018 the company was owned by the United States Central Intelligence Agency (CIA) and the Germany Federal Intelligence Service (BND), both of whom had the ability to decrypt the devices.

Following the closure of the investigation and based on the recommendation of the parliamentary business audit delegation, a swift decision on the 15 pending individual export applications with a total value of CHF7.9 million ($9 million) is urgently required, the government said in a statementExternal link on Wednesday.

The suspended applications of Crypto International AG and TCG Legacy were to be examined and approved within the framework of the usual procedure from the point of view of goods control law, provided that the relevant requirements were met. The same procedure applies to the export applications submitted later by the companies concerned.

On June 10 the economics ministry submitted several individual export applications to the government for the supply of encryption equipment and modules. A few days later, the government granted the OAG’s request for authorisation to conduct a criminal investigation into possible infringements of goods control legislation against unknown persons.

On the same day it decided to suspend the decision on the individual export applications submitted by the economics ministry until the OAG had concluded its investigations.

The criminal complaint was filed by SECO. The question was whether people associated with Crypto AG had applied for “manipulated” encryption devices for export. Specifically, it had to be clarified whether these people had concealed the facts and falsely declared important information when applying for export licences. Other questions, such as espionage, were not at issue.

At the beginning of November, parliament’s business audit delegation adopted its report on the Crypto case and called on the government to revoke its authorisation for the criminal proceedings. According to the report, the economics ministry or SECO, as the case may be, should grant the successor companies of Crypto AG all export applications for which there are no comprehensible legal reasons for refusal.

The OAG closed its criminal investigation on December 8.