FC: A data sanctuary is born

[Declan McCullagh <declan () well com>]

http://www.wired.com/news/business/0,1367,36749,00.html

   A Data Sanctuary is Born
   by Declan McCullagh (declan () wired com)

   5:00 p.m. Jun. 4, 2000 PDT
   WASHINGTON -- A windswept gun tower anchored six miles off the stormy
   coast of England is about to become the first Internet data haven.

   A group of American cypherpunks has transformed the rusting fortress,
   erected by the British military during World War II to shoot down Nazi
   aircraft, into a satellite-linked virtual home for anyone looking for
   a secure place to store sensitive or controversial data.

   The founders of HavenCo, which will announce operations on Monday,
   believe the concept will appeal to individuals and businesses looking
   for a "safe haven" from governments around that world that are
   becoming more and more interested in Internet regulation and taxation.

   It's for "companies that want to have email servers in a location in
   which they can consider their email private and not open to scrutiny
   by anyone capable of filing a lawsuit," says Sean Hastings, the
   32-year-old chief executive of HavenCo.

   Hastings says that because a 1968 British court decision effectively
   recognized the basketball court-sized island as a sovereign nation
   called Sealand, HavenCo can provide more privacy and legal protections
   then anyone else on the planet.

   To create HavenCo -- which will offer Linux servers for $1,500 a month
   -- the founders signed an agreement with Roy Bates, the quirky "crown
   prince" of Sealand who landed on the abandoned platform in 1966 and
   claimed it as an independent nation with its own currency, stamps, and
   flag.

   Bates, a former British Army major, has undertaken a string of failed
   business ventures in an attempt make use of the world's tiniest
   country -- a platform just 10 by 25 yards that perches atop two cement
   caissons in the North Sea.

   One plan was to build Sealand into a three-mile-long, man-made island
   with an airport and banks. Another venture included working with
   German investors to build a $70 million hotel and gambling complex --
   a scheme that fell apart with the Germans taking over the fortress in
   1978 and Bates regaining control in a dramatic helicopter raid at
   dawn.

   This time the elder Bates, now about 80 years old, is taking no
   chances on his business partners: His son and royal heir-apparent,
   Michael, is HavenCo's chief logistics officer and the royal family has
   a seat on the board.

   But today Sealand's potential adversaries include not merely a few
   expansion-minded Germans, but nervous government officials who are
   aggressively trying to pull the plug on unapproved offshore
   activities.

   During a Paris summit in May, for instance, representatives of the
   Group of Eight (G8) nations met to hammer out an agreement on
   international Net law. "The idea is to produce a global text so there
   cannot be 'digital havens' or 'Internet havens' where anyone planning
   some shady business could find the facilities to do it," French
   Interior Minister Jean-Pierre Chevenement said at the time.

   When Sealand was simply an eccentric's hobby, the British government
   largely ignored the smallest country in the world. But if HavenCo
   becomes a popular destination for gambling, money laundering, or other
   socially disapproved activities, governments could move against it.

   The Home Office in London could restrict the microwave links that
   provide HavenCo with its lifeline to the outside world, and the
   companies offering satellite connectivity could come under pressure
   from regulators in their home countries. HavenCo could even find its
   bank accounts imperiled.

   For their part, HavenCo executives say they hope to avoid negative
   publicity. "We don't intend to make anyone angry at us. We simply want
   to provide online businesses a place with a sane set of rules that are
   not constantly changing," Hastings said.

   "If larger nations have a problem with unrestricted information flow,
   then their problem is with the increase in information technology, and
   not with us. They can't put the genie back in the bottle until every
   individual on the planet has had their three wishes come true," he
   said.

   Somewhat ironically, bandits recently set up a fake "Principality of
   Sealand" website to sell citizenship to unsuspecting visitors. Spanish
   authorities reportedly are investigating a gang involved with drug
   smuggling and arms trafficking using those passports.

   In a bizarre incident, one "Sealand" passport of dubious origin
   surfaced in connection with the July 1997 murder of fashion designer
   Gianni Versace in Miami.

   The British Embassy in Washington declined to comment on what would
   prompt London to take action against the legitimate prince of Sealand.
   "What it comes down to is that this is a hypothetical (situation), and
   so we cannot speculate on this," said Peter Reed, the embassy's press
   officer.

   In interviews, U.S. government officials indicated they would take a
   more active approach.

   [...remainder snipped...]

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