United States Department of State
					Washington, DC 20520

					October 7, 1994

Philip R. Karn, Jr.
7431 Teasdale Avenue
San Diego, CA  92122
Dear Mr. Karn:

I have now completed consideration of your appeal of CJ case 081-94, concerning your "applied cryptography source code disk." Pursuant to section 120.4(g) of the International Traffic in Arms Regulations (ITAR), I hereby reaffirm the determination by the Office of Defense Trade Controls that the disk you submitted is designated as a defense article under Category XIII(b)(1) of the United States Munitions List.

As you know, ITAR section 120.4, which sets forth the commodity jurisdiction procedure, states that the procedure may be used "if doubt exists as to whether an article or service is covered by the U.S. Munitions List" or "for consideration of a redesignation of an article or service currently covered by the U.S. Munitions List."

We have concluded that your disk is covered by Category XIII(b)(1) of the U.S. Munitions List as currently written, since it is [c]ryptographic . . . software with the capability of maintaining secrecy or confidentiality of information or information systems . . . ." You state in your March 9 letter that "[t]he software on this diskette is provided for those who wish to incorporate encryption into their applications." In your June 7 letter, you refer to the disk as an example of "cryptographic software".

You contend in your June 7 letter that the disk is not covered by the U.S. Munitions List because the disk qualifies for the ITAR "public domain" exemption. However, the ITAR's "public domain" exemption applies only to technical data meeting the "public domain" criteria, and cryptographic software does not come within the meaning of technical data as defined by the ITAR. The ITAR's software definition, at section 121.8(f), specifically excludes cryptographic software from the software for which an exporter should apply for a technical data license.

Having determined that your disk is covered by the U.S. Munitions List as currently written, I went on to consider whether your disk should remain covered by the List.

My conclusion that your disk should remain covered by the U.S. Munitions List rests on several considerations. Among these are a determination that the source code on the disk you submitted is of such a strategic level as to warrant continued State Department licensing. We have also reviewed your statement that the export of your disk is protected by the First Amendment to the Constitution, and have concluded that continued control over the export of such material is consistent with the protections of the First Amendment.

Please be assured that I reviewed your appeal with great care. The review process engaged attorneys, technical experts, and others both within the State Department and at various other government agencies. I personally spent a significant amount of time wrestling with the important and difficult issues raised by your request. Indeed, as I indicated to you in my letter of September 20, it was necessary to extend the normal period for consideration of such an appeal in order to ensure that the various legal and policy issues raised by your appeal were satisfactorily addressed.

As you know, section 120.4(g) of the ITAR provides that, if you so desire, an appeal of my determination may be made to the Assistant Secretary for Politico-Military Affairs.

Thank you again for the patience with this process that you and your attorneys have shown.

				    Martha C. Harris
				    Deputy Assistant Secretary
					 for Export Controls