Europe's Largest Internet Exchange Decides To Open US Office, Risks Making Itself Subject To NSA Demands

from the and-that's-a-good-idea-because? dept

The Internet may be a series of tubes, but those tubes have to be joined together. That takes place at Internet exchanges (IXs), where different ISPs can pass on and receive data. One of the largest and most important such IXs is AMS-IX, which is based in the capital of the Netherlands, Amsterdam. Techdirt reader Dirk Poot points out that AMS-IX has just made the following move:

the Board of the AMS-IX Association proposed the set up of a US-based legal entity for possible expansion to the United States. In an extraordinary General Meeting (GM) held on 27 September 2013, AMS-IX members approved the set up of a US-based legal entity by a majority of votes.

Recently, an opportunity arose with the Open-IX initiative for AMS-IX to expand and build exchanges in the US. Representatives from US-based content providers and telecom operators -- many of them current AMS-IX members or customers -- as well as other Internet industry parties, such as datacenters, founded this initiative. It aims to encourage the development of neutral and distributed Internet exchanges and reduce IP interconnection complexity and cost in the US. In the US this is more complicated and prices are higher than in Europe, where the neutral and distributed Internet exchange model is more common.
It's understandable that US content providers and telecom operators would want to reduce their costs in this way. But as an email written by Erik Bais to AMS-IX members points out, there is a huge risk here for AMS-IX:
Having an US entity within the (AMS-IX org. structure) association / [AMS-IX B.V. company] will directly bring the [AMS-IX B.V. company] and indirectly the association under the influence of the infamous Patriot Act and FISAA.
For the AMS-IX US entity (under US Law) they will receive the official request for the information [passing through AMS-IX], which they are required to send through to their holding company (which is AMS-IX B.V.) as the information or connection isn't on US soil, but in Amsterdam.

1. Denying such request means that they US Entity will most likely be in contempt of court, bringing the US entity and its management in a situation where they can't deny the request of the US Government and the AMS-IX Management. It is a very difficult split between 1 party whom doesn't want to provide the information (Let's assume the AMS-IX B.V. doesn't want to provide the information) and the US Government who has the right to request and all the paperwork and laws at hand to request it.

2. Information in this case could mean: Information about, but also information from (data).
In other words, by opening an office in the US, AMS-IX might be forced by US laws to give the NSA direct access to the huge flows of data at its European Internet exchange.

AMS-IX has this to say about the way its US office would be set up:

The chosen structure will need to protect AMS-IX's current operation and the AMS-IX Association's customers and members from commercial, legal, financial and technical risks and, more specifically, from interception activities by US government agencies.
There are two issues here. One is whether such a legal structure that protects AMS-IX's European operation from the NSA's demands exists or not. And even if it does, there is the question of trust. Once there is the possibility of the NSA demanding access to the AMS-IX traffic, there will always be the fear that it is being granted, even if AMS-IX denies it. After all, if access were granted to the NSA, AMS-IX would be forbidden from talking about that fact, and so it would be impossible to tell what the true situation was.

As a result, it's hard to see how anyone in Europe can really trust AMS-IX again if it goes ahead with this proposed move to open a US office, which means it could lose a lot of its current and future business. That seems a heavy price for a European organization to pay for something that will largely benefit US companies.

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Reader Comments (rss)

(Flattened / Threaded)

    Androgynous Cowherd, Oct 1st, 2013 @ 11:30pm

    Several points.

    1. Could any US agency, even the NSA, really demand the production of documents (let alone the installing of wiretaps) from offices and servers (and on cables) physically not located inside the United States? Wouldn't they be limited to demanding production of records physically held by the US office?

    2. Couldn't AMS-IX implement the thing Techdirt suggested just the other day, and issue regular statements that they emphatically do not share information from their EU servers/cables with the NSA ... until and unless forced to do so, whereupon those statements would simply cease? That would let them have trust, perhaps.

    3. Isn't this whole thing moot anyway? That exchange will already be being tapped by some Netherlands or EU intelligence agency, and that agency will already be broadly sharing information with the NSA (and vice versa -- as has already been revealed in the case of the NSA and Israel's sigint organization).


    reply to this | link to this | view in thread ]

    Anonymous Coward, Oct 1st, 2013 @ 11:43pm

    Maybe AMS-IX, can't resist the double-dip profits they've been hearing about in the US. Charge tier providers to use the exchange, then turn around and charge NSA to snoop on the exchange.

    Everyone worldwide has heard stories about USA fiber optic networks being paved with double-dip gold.

    I'm sure the millions of taxpayer dollars the NSA Spy Agency will pay AMS-IX, will more than offset the complexity and increased prices in the USA compared to the EU. In fact, I'm sure they're counting on it.


    reply to this | link to this | view in thread ]

    Josef Anvil (profile), Oct 2nd, 2013 @ 12:02am

    Not a big deal

    It may be time to ease off the NSA and turn the camera lens elsewhere. Yes the NSA got caught.

    Now the whole world is pointing at the US for spying on its citizens. The USA is not alone in that activity, it's just public information now.

    You can be assured that most of the governments in the EU are snooping through their citizens' data as well.


    reply to this | link to this | view in thread ]

    Anonymous Coward, Oct 2nd, 2013 @ 1:58am

    Re: Several points.

    For the first one, from my understanding, the physical location of data is not important. If you're US based entities, you have to obey US court orders, as well as any US laws applicable. Period.

    Otherwise the tax department cannot collect tax based on information provided by Swiss bank years ago. (The money is, you may call it, physically stored outside US boundaries)


    reply to this | link to this | view in thread ]

    Anonymous Coward, Oct 2nd, 2013 @ 2:24am

    i bet this is being done for the very reason of allowing the NSA into the company. just think of the further benefits if there is a way such as this that the NSA can get even more data and do even more spying on the EU. they must have been given a hell of a lot of 'encouragement'. surely, given what has been going on, no company is going to allow itself to be willingly added to the fray for no reason?


    reply to this | link to this | view in thread ]

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