>> As lawmakers are in Capitol Hill work to keep US sanctions on Russia from meddling in the 2016 elections, Reuters has learned US tech firms have been quietly trying to soften the ban on dealing with the same Russian spy agency, Blin, for hacking during the campaign. Sanctions put in place by former President Barack Obama last December made it a crime to have any business relationship with the FSB.
Reuters reporter Joel Schectman is on the story.>> The problem though was that the FSB, beyond just being a spy service, they also operate in Russia as a technology regulator. Any technology that includes encryption, which these days can be cellphones, laptops, as well as sophisticated technology, all of that requires getting approval from the FSB before it can be imported into the country.
>> Industry groups, including the American Chamber of Commerce in Russia, argued sanctions against the FSB would effectively freeze US firms out of Russia's $18 billion tech market.>> So the companies and industry groups representing them, almost as soon as the sanction was put in place, began lobbying US Treasury and US Embassy officials to, in some ways, put a limit on that sanction.
The idea was not to rollback the sanction against the FSB, but the technology community wanted to at least be able to interact with the FSB as a regulator, which is what they needed in order to continue selling technology in Russia.>> And the lobbying effort was successful. Within weeks, US companies were granted an exception to the new sanctions, allowing them to once again turn their products over for inspection by the FSB.
>> In Washington circles, most officials that I spoke to agreed that the original purpose of this action was not to cut off technology trade with Russia, and therefore some kind of adjustment was necessary.>> Last week, Reuters reported some western tech companies have also given in to demands by Moscow for access to closely guarded secrets, such as source code to ensure access to Russia's markets.