How to bypass the Wassenaar arrangement: a new application for watermarking

The scope of this article is to clarify the current legal and political situation related to electronic surveillance on the one hand, and to export regulations for encryption software on the other hand. We will look at different international agreements, such as the UKUSA agreement and the Wassenaar arrangement, and elaborate on current encryption techniques falling under these regulations. This discussion is then followed by introducing the basic concepts of steganography and digital watermarking which could be used for secret communication. As a consequence, we propose an original way to legally bypass the international export regulations using these technologies. To this end a new watermarking technique is proposed, which is robust to JPEG2000 compression and provides a good channel capacity. The efficiency of the proposed technique is analyzed by means of simulations to allow for secure communications.