United States Department of Commerce
			Bureau of Export Administration
			Washington, DC 20230

NOV 20 1997 [stamped]

Appl. Ref. No.: Z074814

Dear Mr. Karn:

Pursuant to Part 750.6 of the Export Administration Regulations (EAR), we are informing you of the intent to deny the referenced application prior to the formal decision by the Bureau of Export Administration (BXA).

After review of your application to export diskettes with algorithms (DES, ENIGMA, FEAL-8, FEAL-NX, IDEA, LOKI91, LUCIFER, NEWDES, REDOCIII, VIGENERE, AND COMBINE) as part of an Encryption Licensing Arrangement, the Department of Commerce in consultation with the Department of State, the Department of Defense, the Department of Justice, the Department of Energy, and the Arms Control and Disarmament Agency, has concluded that the approval of this request would be contrary to the national security interests of the United States. If you were to identify specific end-users, specific end-uses, and specific countries, we would reconsider this decision.

You may submit a response to this notification in accordance with Section 750.6 of the EAR within 20 calendar days from the date of this letter. Should you respond, address your letter to: Patricia Sefcik, Division Director of Encryption, Bureau of Export Administration, P.O. Box 273, Washington, DC 20230. Unless you receive other advice from BXA, this denial will become final 45 days after the date of this letter. The process of appealing final denials is described in Part 756 of the EAR. Any such appeal must be made within 90 days of the date of this letter.

The Commerce employee available for consultation is Virginia Waldron. She can be reached on (202) 482-2643.

Sincerely,
[signed]
Patricia Sefcik
Director
Encryption Policy Controls Division