SPYING WITH THE HELP OF SIM CARDS If Dinko Majic's request is approved, secret services would get lists of telephone numbers with the names of citizens with the help of which they could spy in whoever they wish toDinko Majic, the director of the Operations and Technical Centre for Telecommunications Surveillance (OTC), a small agency in the frame of the Croatian intelligence community, last week sent a scandalous demand to the top managements of the three Croatian mobile telephony operators. Majic submitted an ultimatum demanding that all prepaid users in mobile telephony networks - and with about 4.5 million SIM cards they make up about 80 percent of the market in Croatia - must be registered and this data has to be submitted to the OTC.

The registration of prepaid users should, ostensibly, be carried out to prevent terrorists and criminals from hiding behind anonymous prepaid SIM cards. But it is obviously yet another attempt on the part of Croatia's secret services to increase their control over the common citizen, shamelessly violating their human rights. If this unbelievable and unconstitutional measure, lacking any legal grounds, were to be implemented, secret services would have at their disposal a list of phone numbers appended to the names of the citizenry with the help of which they could arbitrarily spy on whomever they wished.

Zarko Puhovski, a professor at the Faculty of Humanities and Social Sciences and an authority in the field of human rights, says that, "This practice exists in several European countries. But this can be resolved by a law in the event that there is a conclusion at the political level that national security is threatened to such an extent that the registration of prepaid users is necessary. There is a much greater danger in the possibility of calling without the caller number displayed, while the anonymity of prepaid users alone is like me having a house line that is unregistered and which can only be obtained by a court order. The real problem is that the gentleman who leads the agency had begun to take himself too seriously, as the head honcho controlling all communication in the country." In his letter last week Majic issued an ultimatum demanding that all new prepaid Internet and phone users be registered by 1 June of this year, and that the registration of existing users be completed by 1 July at the latest.

For those not registered by the foreseen deadline Majic is asking that they be disconnected from the network. The registration would be carried out by the buyer coming to a store or kiosk with their personal ID card or passport and a photocopy of the same. The seller would have to confirm the veracity of the photocopy, adhere a sticker to it with the data on the SIM card and submit the photocopy of the personal ID to the operator within 30 days, who would then be required to log the information into a database. As an exception it would be allowed that a buyer who does not have a photocopy on their person write the personal data, including the OIB and JMBG personal identification numbers, on a special form, and then it would be up to the shopkeeper to compare the data on the personal ID with those in the form. It is hard to imagine that a vendor at a kiosk or, for example, at a convenience store would have the time or will to carry out such a complicated administrative procedure, to say nothing of the buyers waiting in line behind the unfortunate buyer of the SIM card. To speculate on the possibility of manipulating with personal data that buyers would have to submit to shopkeepers would be redundant.

According to the OTC request, if the registration does not find its way to the operator within thirty days of the activation of the SIM card, the operator would have to notify the user by SMS to urgently contact a telecommunication centre. If ten more days pass the SIM card would be blocked. All existing users would have to pass through the entire procedure, i.e. they would have to register themselves and provide personal identification for inspection. If they fail to do so their SIM card would be blocked.

Majic also ordered operators that they all had to give users the same amount of free minutes for registration, except those who do not register within the set deadline, who would be denied this bonus. And most bizarre of all, by signing the form buyers would also sign off on their responsibility for the accuracy of the data and the obligation to report the possible theft, sale or loss of the SIM card to the operator.

This shameless letter has caused consternation among Croatian mobile telephony operators, and its implementation would quite surely cause massive financial losses, lead to a drop in the number of prepaid mobile device users, put an unnecessary burden on sales points and bring down a very positive growth trend in the number of users of mobile broadband devices, a phenomenon essential to the technological development of Croatian society. The OTC request does not, however, even have the support of the entire Croatian intelligence community. Some of its members point out that even without this kind of register of prepaid users they can establish what numbers criminals and other persons who represent a security risk are using, it only requires a little more work. Opinions have also been voiced that Colonel Dinko Majic has been stigmatised as a person appointed to the helm of the OTC by former Prime Minister Ivo Sanader. It would be unusual for Sanader to have appointed a person that did not enjoy his full confidence to such a sensitive position, and now Majic is eager to prove himself to the new Prime Minister.

IVICA MUDRINIC The CEO of Croatian telecom company T-HT; his company says that they understand the dissatisfaction of users with the elimination of anonymityThe letter of ultimatum on the registration of prepaid users is not Majic's first rampage on the outer edges of the law - a few days ago the Novi list daily revealed that OTC director Majic had sent a letter forbidding courts from seeking data directly from operators, and operators from executing court orders. The letter caused consternation among legal and business circles. It is unimaginable in a democratic country that an intelligence agency could stipulate to the judicial authorities how they shall carry out their orders. Nacional also has an analysis a telecommunication market analyst has drafted for mobile telephony operators. The analysis cites in detail all of the problems that could ensue from an obligation to register all prepaid mobile telephony users. Prime Minister Jadranka Kosor allegedly knows of this study.

Telecommunication companies have already called the request for the obligatory registry of the identity of all prepaid users in electronic communication illegal, unconstitutional and potentially catastrophic for their operations and the Croatian economy in general. And, according to the information Nacional has, the operators have decided to reject the ultimatum from the OTC director and will not start the demanded registration of all prepaid users. The analyst warns of the potentially catastrophic effects these measures would have on Croatia's economic recovery in 2010. Mobile telephony amounted to 4.2 billion kuna in 2008, or about 1.2 percent of the GDP. About 80 percent of Croatian mobile users are on prepaid cards, many are tourists, people who cannot provide valid personal ID because they are children, persons under guardianship, tourists and diplomats or simply people who wish to retain their anonymity.

Nikola Klisovic, head of legal affairs at Vipnet, commented the OTC request. "Such a practice would reflect negatively on our operations as it requires a long period of adjustment and costs, but it will also have a long term effect on the entire mobile industry system, which includes distribution chains and sales partners.

Given that prepaid SIM cards can currently be purchased at thousands of sales points, including shops, try to imagine, for example, how the registration of users would be carried out in a convenience store and in what way the privacy and confidentiality of personal information of users could be protected there. This will reflect negatively on budget revenues, as an entire set of businesses will be paying in less income tax."

Klisovic warns that on a market on which over 75 percent of users are on prepaid cards it will be difficult if not impossible to implement such a demand, and the possibility of disconnecting a user because they have not registered their identity is not foreseen by regulations. Klisovic also added that, "the existing regulations, which have existed for some time now, do not establish in a clear fashion an obligation to register prepaid users, and the Constitution also protects basic freedoms and the confidentiality of personal data. In that sense we expect a clear and unambiguous legal framework that will explicitly introduce this obligation because we do not want to be in violation of the Constitution."

ZARKO PUHOVSKI A professor at the Faculty of Humanities and Social Sciences and an authority in the field of human rights, feels that the OTC director has started to take himself far too seriouslyAccording to analysts, even if the registration of prepaid users were made law, operators would need at least three years to harmonise their operations, with massive costs in the increased logs on registered users and a greater load on customer service departments. And even then it is an open question how much the effort would be useful in the war on terror and crime, because any criminal could purchase a handful of prepaid SIM cards in Austria, Slovenia, Bosnia & Herzegovina, Serbia or any of the other countries in which there is no registration of prepaid users.

Operators are already hampered in their operations by a special levy of 6 percent of total revenues from electronic communication services introduced on 1 August of last year. The blow operators would suffer from a significant reduction in the number of prepaid users arising from obligatory registration would be frightful. Besides the operators, distributors too would also suffer massive losses. SIM cards are sold at no less than 10 thousand sales points in Croatia. Many kiosks and small shopkeepers survive on the sale of prepaid cards alone. Analysts forecast that many retail chains will have to abandon the sale of prepaid cards because of the impracticality of collecting personal data in stores of that kind. If there is a significant drop in the number of prepaid users, which analysts are forecasting, many distribution points will go bust, generating new unemployment. A cynic might note, however, that more people would be employed in processing the gathered information.

It is estimated that almost 50 percent of small retailers and kiosks would become unprofitable after losing the about 500 million kuna turnover that would follow the introduction of the obligatory registration of prepaid users. That would mean shutting down some 5,000 sales points at which at least 10 thousand people are employed.

The list of the catastrophic effects of introducing the registration of prepaid users, then, includes severe violations of human rights, the Constitution, laws and European directives, less revenue for the budget and economic hardship for the operators and distributors, chaos at prepaid card sales points and a growth in unemployment. Paradoxically, a measure that would ostensibly be introduced to combat crime would in fact lead to a growth in crime. Analysts foresee that this kind of measure would lead to a burgeoning of the black market of stolen and resold SIM cards, identity theft, and identification documentation falsification. What is more, by signing a statement at the time of purchase, as demanded by the OTC, every owner of a SIM card would expose themselves to the risk of being persecuted as a criminal in the event of its theft or loss.