WORLD
As U.S. officials investigated in January the FSB's alleged role in election cyber attacks, U.S. technology firms were quietly lobbying the government to soften a ban on dealing with the Russian spy agency, people with direct knowledge of the effort told Reuters.
New U.S. sanctions put in place by former President Barack Obama last December - part of a broad suite of actions taken in response to Russia's alleged meddling in the 2016 presidential election - had made it a crime for American companies to have any business relationship with the FSB, or Federal Security Service.
U.S. authorities had accused the FSB, along with the GRU, Russia's military intelligence agency, of orchestrating cyber attacks on the campaign of Democratic presidential candidate Hillary Clinton, a charge Moscow denies.
But the sanctions also threatened to imperil the Russian sales operations of Western tech companies. Under a little-understood arrangement, the FSB doubles as a regulator charged with approving the import to Russia of almost all technology that contains encryption, which is used in both sophisticated hardware as well as products like cellphones and laptops. Worried about the sales impact, business industry groups, including the U.S.-Russia Business Council and the American Chamber of Commerce in Russia, contacted U.S. officials at the American embassy in Moscow and the Treasury, State and Commerce departments, according to five people with direct knowledge of the lobbying effort.
The campaign, which began in January and proved successful in a matter of weeks, has not been previously reported.
In recent years, Western technology companies have acceded to increasing demands by Moscow for access to closely guarded product security secrets, including source code, Reuters reported last week. Russia's information technology market is expected to reach $18.4 billion this year, according to market researcher International Data Corporation.
The sanctions would have meant the Russian market was "dead for U.S. electronics" said Alexis Rodzianko, president of the American Chamber of Commerce in Russia, who argued against the new restrictions. "Every second Russian has an iPhone, iPad, so they would all switch to Samsungs," he said.
A spokesman for the U.S. Commerce Department Bureau of Industry and Security declined to comment. A State Department official said Washington considered a range of factors before amending the FSB sanction and regularly works with U.S. companies to assess the impact of such policies.
The lobbyists argued the sanction could have stopped the sale of cars, medical devices and heavy equipment, all of which also often contain encrypted software, according to a person involved in the lobbying effort. The goal of the sanctions was to sever U.S. business dealings with the FSB - not end American technology exports to Russia entirely, the industry groups argued.
"The sanction was against a government agency that has many functions, only one of them being hacking the U.S. elections," said Rodzianko.
The lobbyists assembled representatives from the tech, automotive and manufacturing sectors to make the case to the U.S. Treasury Department, said the person involved in the lobbying effort. The industry groups did not argue against the intent of the sanction but asked for a narrow exception that would allow them to continue to seek regulatory approvals from the FSB while still keeping in place the broader ban on doing business with the spy agency.
"PUNISHMENT FOR VERY BAD ACTS"
The industry groups represent a number of technology firms with a large presence in Russia, including Cisco and Microsoft.
Reuters was unable to determine which companies were directly involved in the lobbying. Microsoft said it did not ask for changes to the sanctions. In a statement, Cisco said it also did not seek any changes to the sanction but had asked the Treasury Department for clarification on how it applied.
In order to get encrypted technology into Russia, companies need to obtain the blessing of the FSB, a process that can sometimes take months or even years of negotiation. Before granting that approval, the agency can demand sensitive security data about the product, including source code - instructions that control the basic operations of computer equipment.
The United States has accused Russia of a growing number of cyber attacks against the West. U.S. officials say they are concerned that Moscow's reviews of product secrets could be used to find vulnerabilities to hack into the products.
Some U.S. government officials rejected the industry groups' arguments. They openly embraced the prospect of any ripple effect that cut further trade with Russia.
Kevin Wolf was assistant secretary at the Commerce Department and oversaw export control policy when the FSB sanction was put in place. Wolf said within days of the sanction taking effect, Commerce received numerous calls from industry groups and companies warning of the unintended consequences.
But for Wolf, who was "furious" with Moscow over the alleged cyber attacks, any additional curbs on trade with Russia was a bonus rather than an unintended downside.
"I said, 'Great, terrific, fuck 'em ... The whole point is to interfere with trade'," recounted Wolf. "The sanction was meant to impose pain (on Russia) and send a signal as punishment for very bad acts."
Wolf left the Commerce Department when President Donald Trump took office on Jan. 20.
Other officials felt that the impact on legitimate trade was too great. "The intention of the sanction was not to cut off tech trade with Russia," said a U.S. official with direct knowledge of the process.
The lobbyists had also argued that since the sanctions only applied to U.S. technology makers, it would put them at a disadvantage to European and Asian companies who would still be able to interact with the FSB and sell products in Russia.
"We were asking for a narrow technical fix that would give a fair deal for American companies," Dan Russell, CEO of the U.S.-Russia Business Council, said in an interview.
The advocacy worked. State and Treasury officials began working to tweak the sanction in January before Obama left office, according to people involved in the process.
On Feb. 2, the Treasury Department created an exception to the sanction, about two weeks after Trump took office, to allow tech companies to continue to obtain approvals from the FSB.
(This article has not been edited by DNA's editorial team and is auto-generated from an agency feed.)
Meet man, India's richest banker, who has bought Rs 202 crore property, his net worth is Rs...
'Heard there was....': Former India head coach provides major update on Virat Kohli's injury
A New Geopolitical Era: India and Israel's Role in the Evolving Middle East
David Warner’s touching moment with fans after Dubai Capitals reaches final of DP World ILT20
India’s Largest Book Stall Network: PrashantAdvait Foundation’s Mission to Revive Reading Culture
Mawra Hocane stuns in pastel mint green lehenga at her wedding to Ameer Gilani
Deepinder Goyal's Zomato changes its name, CEO shares journey of company, it is now called...
Rose Day 2025: Know the date, history, significance of each rose colour ahead of Valentine's day
'BJP-led NDA works for Santushtikaran, not Tushtikaran': PM Modi in Rajya Sabha
Who is Belle Gibson? Australian wellness guru created fake cancer story and later...
DP World ILT20 2025: Dubai Capitals clinch last ball thriller against Desert Vipers to reach final
Jeet Adani-Diva Shah wedding: First pic from Gautam Adani's mansion OUT as wedding festivities begin
Sunita Williams’ Spacewalk: A Record-Breaking Mission and a Stunning Selfie from Space
IND vs ENG: Ravindra Jadeja creates history in Nagpur, surpasses James Anderson to become....
Can IAS officers change cadres after marriage? Here's what rules say
Pavan Kumar Joshi innovates unemployment benefits payment security
Anil Ambani's company's share price surges over 6 per cent after it earns profit of Rs...
Why Dale Bhagwagar is Bollywood's only PR guru
Meet Anjum Khan, wife of cricket star Shivam Dube, her net worth is Rs...
IAF Mirage 2000 fighter aircraft crashes in MP's Shivpuri during training sortie
Meet IAS Tina Dabi's mother, who cleared UPSC to become IES, later resigned due to...
Good news for Infosys employees! Company to roll out annual hike letters by end of...
BIG win for India's largest govt bank, earns Rs 16891 crore profit in just...
Ajith Kumar's fans celebrate, throng theatres after Vidaamuyarchi's worldwide release: Watch
Purnam’s Spring Edit: Where heritage meets handcrafted luxury
RTPS Bihar: Apply for income, caste, and domicile certificates
'Welfare of students very close to Government's heart': EAM Jaishankar in Rajya Sabha
IND vs ENG: Why is Virat Kohli not playing 1st ODI vs England in Nagpur?
Man's love for Indian wife knows no bounds, makes dosa batter from scratch, video goes viral
Meet woman, CRPF officer, who cracked UPSC exam in first attempt, became...
Trump administration plans to pressure the IOC to come up with a uniform transgender athlete ban
PM Modi's 'Pariksha Pe Charcha' to feature Deepika Padukone, Mary Kom, Sadhguru among others
Why speed matters: Ajay Chava on overhauling CI/CD pipelines for modern development
What does "i" stands for in iPhone, iPad, and other Apple products? Check here to know
Meet Pakistani actress whose leaked private video went viral, often shares bold photos, she is..
After Isha Ambani, Ananya Birla set to enter into new space, it is...
Shah Rukh Khan hugs Aamir Khan at Loveyapa screening, fans say '90s' kids can fly now': Watch
Meet Diva Shah, daughter of diamond tycoon, she is set to marry Gautam Adani’s son Jeet Adani on...
After US, Israel halts participation in UN Human Rights Council
Sanam Teri Kasam actress Mawra Hocane ties the knot with Pakistani star Ameer Gilani, see photos
Meet woman who left MNC job to pursue her uncle’s dream, later cracked UPSC to become IPS officer
Mukesh Ambani buys India’s first bulletproof Rolls-Royce Cullinan, Its price is Rs....
Anil Ambani meets Maharashtra CM Devendra Fadnavis as his Rs 16015 crore company is looking for...
DNA TV Show: What is US President Donald Trump's Gaza plan?
Anil Ambani's company's BIG win, reports Rs 420000000 profit in 3 months, its business is...
US President Donald Trump invites PM Modi on working visit to White House next week
Watch: Malaika Arora's 'oops moment' in short dress caught on camera, video viral
Little girl's adorable dance to 'Maula Mere Maula' captivates netizens, WATCH viral video
India beats China to become world’s second-largest market for...
'Recipe for generating chaos...': World reacts to Donald Trump's plan of US 'taking over' Gaza
When Arjun Kapoor was ignored by Janhvi Kapoor, Shikhar Pahariya; old video sparks reactions
Superboys of Malegaon: Adarsh Gourav, Vineet Kumar Singh, Shashank Arora's film to release on...
Meet Amitabh Bachchan's 'daughter-in-law', big star in South but gave 11 flops, now she is...
Anil Ambani's luxury home costs same as Mumbai's traffic control budget, it is worth Rs...
This Maths genius worked with IIT and NASA, suddenly went missing, later found in...
Aly Goni walks out of Shahid Kapoor's Deva for this shocking reason: '5000 ki tickets le ke...'