Area SpA May Exit Syrian Monitoring Project

Area SpA, the Italian company building a Syrian surveillance system, is weighing options that may include exiting the deal, according to Chief Executive Officer Andrea Formenti.

“Before making a definitive decision, we need to, based on all the contractual obligations we have, evaluate what impact there will be for us,” Formenti said in a telephone interview.

If completed, the system would give Syrian President Bashar al-Assad’s regime the power to intercept, scan and catalog virtually every e-mail that flows through the country, Bloomberg News reported Nov. 4, citing a person familiar with the project and blueprints for the system.

The Italian company had come under pressure in recent days, with non-profit groups such as Human Rights Watch calling for the project to be shut down. Protesters from Italy’s Pirate Party and the National Coalition to Support the Syrian Revolution rallied yesterday outside Area’s headquarters next to Milan’s Malpensa Airport, demanding the company pull the plug.

All work on the system had already been suspended for more than two months, Formenti said. He declined to explain why, saying technical problems “could be one of the reasons.”

The person familiar with the project said it had suffered technical setbacks.

Formenti declined to say whether he would prefer to abandon the project, citing the involvement of other parties. “There are factors that don’t just depend on us,” he said.

“We can’t respond now,” he said. “We don’t have all the information.”

Crackdown on Protests

As Syria’s crackdown on protests claimed more than 3,500 lives since March, Area employees had been installing the system under the direction of Syrian intelligence agents, according to the person familiar with the project, who has worked on it for Area and requested anonymity because Area employees sign non- disclosure agreements with the company.

Privately held Area, which got its start in 1996 furnishing phone taps to Italian law enforcement, issued a statement yesterday saying the company does not have, and has never had, any relations with Syrian intelligence agencies or military authorities. It also said there had been no acceleration of the project during the country’s unrest.

The statement said the system hasn’t been completed, has never been operational and, as a result, can’t have contributed to any repressive actions. Area won the deal in 2009, long before the current violence, the statement said.

Standard System

The contract complied with export norms and was filed with the appropriate Italian authorities, the company said. The system itself is a standard one for “lawful interception,” and Area competed for the project against Italian, European and non- European companies, the statement said.

The competition for the job was held by a Syrian telephone company, which Area didn’t name, according to the statement.

Area had been installing the system, which includes the company’s “Captor” monitoring-center computers, through a contract with state-owned Syrian Telecommunication Establishment, or STE, two people familiar with the project said. Also known as Syrian Telecom, the company is the nation’s main fixed-line operator.

If completed, Syrian security agents would be able to follow targets on flat-screen workstations that display communications and Internet use in near-real time alongside graphics that map citizens’ networks of electronic contacts, according to the documents and the two people familiar with the project’s plans.

Against Repression

Area said in its statement it is against all forms of repression and disapproves of any use of technology for violating human rights. The company said it was exploring legal options for the release of proprietary materials, without identifying any parties.

While the European Union has imposed a series of sanctions against Syria since May, including a ban on arms sales, the measures don’t prohibit European companies from selling Syria the sort of equipment in Area’s project.

Nadim Houry, senior Human Rights Watch researcher for the Middle East and North Africa, said that if Area doesn’t halt the Syria work on its own, his group will take steps to force the issue, both through the Italian government and at the EU level.

“Someone has to pull the plug,” he said. “This issue now is a race against time.”

To contact the reporters on this story: Ben Elgin in San Francisco at belgin@bloomberg.net; Vernon Silver in Rome at vtsilver@bloomberg.net;

To contact the editors responsible for this story: Melissa Pozsgay at mpozsgay@bloomberg.net

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Pirate Party Protest

Giuseppe Aresu/Bloomberg

Italian Pirate Party activists hold Syrian national flags during a protest outside the Area SpA headquarters in Milan on Nov. 8, 2011.

Italian Pirate Party activists hold Syrian national flags during a protest outside the Area SpA headquarters in Milan on Nov. 8, 2011. Photographer: Giuseppe Aresu/Bloomberg

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Oct. 31 (Bloomberg) -- Marietje Schaake, a Dutch member of European Parliament, talks about Iran's use of Western surveillance technology to suppress political activists. She speaks from Amsterdam with Andrea Catherwood on Bloomberg Television's "Last Word." (Source: Bloomberg)

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Syria Spyware

Giuseppe Aresu/Bloomberg

Italian technicians are aiding Syria with surveillance.

Italian technicians are aiding Syria with surveillance. Photographer: Giuseppe Aresu/Bloomberg

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Syria Surveillance

Giuseppe Aresu/Bloomberg

Area won the Syria deal in 2009, two people familiar with the project say.

Area won the Syria deal in 2009, two people familiar with the project say. Photographer: Giuseppe Aresu/Bloomberg

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Area SpA Headquarters

Giuseppe Aresu/Bloomberg

Area is based in a modern office building next to Milan’s Malpensa Airport.

Area is based in a modern office building next to Milan’s Malpensa Airport. Photographer: Giuseppe Aresu/Bloomberg