IMPORTATION OF CRYPTOGRAPHIC TOOLS IN RUSSIA -
12/18/2001
by Irina Lakaeva,
Commercial Specialist U.S. Commercial Service - Embassy Moscow

INTERNATIONAL COPYRIGHT, U.S. & FOREIGN COMMERCIAL SERVICE AND U.S. DEPARTMENT OF STATE, 2001. ALL RIGHTS RESERVED OUTSIDE OF THE UNITED STATES.




IMPORTATION OF CRYPTOGRAPHIC TOOLS IN RUSSIA


Summary. This report provides an update on regulations covering the import of encryption tools into Russia. It is based on a recent discussion between the Commercial Service in Moscow and a representative of Russia's Federal Agency of Governmental Communications and Information, which addressed recent importation procedures and the required documentation. End

Summary. The Commercial Service (CS) in Moscow has received frequent inquiries from U.S. firms in the field of information technology, for current information on Russia's regulations on cryptographic tools. In response, a CS Moscow trade specialist met with a representative of the Federal Agency of Governmental Communications and Information (FAPSI in the Russian acronym), to obtain the following update, which may have relevance for any IT firm operating in Russia or with plans to enter the Russian market.

1. Import and export of cryptographic tools (hardware, parts of such equipment and software programs) as well as normative and technical documentation related to the use of encryption (including design and operation manuals) is regulated by the law of the Russian Federation (RF)No. 183-FZ on Export Control dated 07/18/99, the Presidential decrees No.334 of 04/03/95 and No. 1268 of 08/26/96 and Government regulations No. 854 of 11/06/92, No. 959 of 12/10/92 and No. 758 of 07/01/94.

2. The import and export of cryptographic products requires a license from the Ministry of Economic Development and Trade (MEDT). However, FAPSI must first approve issuance of the license. FAPSI regulates the organization and provision of government communications and sensitive communications for Russian government agencies, organizations, and enterprises. It also provides technical security for such communications. FAPSI is under the direct authority of the Office of the President of the Russian Federation. FAPSI gives permission to import a cryptographic product only after examining technical documentation, or samples of a product, or both. The license is granted only in regard to a specific shipment of this product in accordance with its HS Code.

3. If a U.S. company intents to use cryptographic products on Russian territory in order to protect the company's own computer systems no special licenses or certificates are required. Companies may use encryption tools such as PGP, VPN, and DES if it does not perform information security work for other organizations. It also means that a foreign person or company
representative may enter Russia with a personal computer that might have loaded encrypted software, if it is for personal use. However, if the computer is declared at the customs as of commercial value, an object for sale or for use in providing services to other companies, then a custom officer may request the related permissions and certificates.

4. If a company plans to provide information security services to other organizations within the territory of the Russian Federation, it is necessary to obtain a license from the State Technical Commission, a state-run body regulating information protection by non-cryptographic methods. If the security service provided incorporates the use of encryption tools, then an additional license must be obtained from FAPSI, which regulates encryption. In order to avoid some of the numerous problems which might arise with licensing and certification, some foreign firms find it advisable to establish partnerships with a Russian organization that has all of the necessary licenses.

5. Licensing for encryption is especially important for banks and other financial and credit-granting organizations, which broadly use encryption measures and electronic digital signatures in order to protect their information.

6. On December 13, 2001 the State Duma (parliament) of the Russian Federation passed a bill on electronic digital signatures in its third and final reading. Despite some criticism of the bill, it nevertheless is expected to give a shot in the arm to Russia's whole IT sector. According to some Duma's members, the bill will go a long way to solving the complex legal and technical problems of legislation regulating the application of the latest information technology. According to Vedomosti newspaper, the size of Russian market for electronic digital signature products is estimated at US$ 3-5 million this year and will rapidly grow with the benefit of the new legislation.

7. An application for the import/export encryption tools should be addressed to the Director General of FAPSI and send by certified mail to the following address: Mr. Vladimir Georgievich Matiykhin FAPSI Director General 103031 Moscow, Russia Bolshoy Kiselny Per. 4

The letter should be in Russian. Technical documentation/contracts in English should have a notarized Russian translation. Inquiries on licensing and import/export regulations on encryption tools may be addressed to the Licensing and Certification Center of FAPSI.

The package of documents to be provided to FAPSI must include: � The full name of the applicant, its location and registered address. � Details regarding the specific cryptographic product to be imported into the Russian Federation: including quality and number of copies (for software).

�A statement of the purpose for importing the cryptographic product (for example, to be used at a company's Moscow office for inter-corporate communication). Technical description of the product in general terms.

8. The U.S. Commercial Service in Russia helps U.S. companies establish business relations with Russian companies with relative experience. If you are interested in information on Russian companies working in the field of information security please contact:

Irina Lakaeva
Commercial Specialist
US&FCS; Russia
American Embassy Moscow
23/28 B. Molchanovka, Bldg.2
Tel.: 7(095) 737-5022
Fax: 7(095) 737-5033
e-mail: [email protected]
or visit our web site at:
www.usatrade.gov
or www.uscommercialservice.com/russia/en

If you are interested in establishing contacts with potential distributors of computer equipment in Russia are invited to take advantage of the U.S. Commercial Service's Gold Key Service Program. Our commercial specialists will assist you in identifying qualified potential business partners and provide you with full logistical support as you explore expanding business opportunities for your company in one-on-one business meetings. The U.S. Commercial Service in Russia, part of the U.S. Department of Commerce, is dedicated to assisting American exporters and investors find success in this challenging, but potentially rewarding market.

To the best of our knowledge, the information contained in this report is accurate as of the date published. However, the Department of Commerce does not take responsibility for actions readers may take based on the information contained herein. Readers should always conduct their own due diligence before entering into business ventures or other commercial arrangements. The Department of Commerce can assist companies in these endeavors.

*********Forwarded by************
Derek Nowek (covers IT for BISNIS)
U.S. Dept. of Commerce
USA Trade Ctr.
Tel: 202/482-4522
Fax: 202/482-2293
BISNIS web site: www.bisnis.doc.gov