US Blacklists Sandvine for Censorship, Web Monitoring in Egypt

Ryan Gallagher, Bloomberg News

(Bloomberg) -- The US Commerce Department is adding computer networking company Sandvine Inc. to a blacklist that will effectively ban it from obtaining US technology, according to a government disclosure.

The Commerce Department’s Bureau of Industry and Security made the determination to add Sandvine to its “Entity List” on the basis that the company had supplied equipment to the government of Egypt. Sandvine’s technology enabled “mass web-monitoring and censorship to block news as well as target political actors and human rights activists,” according to a notice made available Monday in the Federal Register. Such activities were “contrary to the national security and foreign policy interests of the United States,” the notice added.

Sandvine sells what’s known as deep-packet inspection technology, which can be used to monitor massive flows of internet traffic passing between networks. The technology can be customized to block out spam and viruses. But it can also be deployed to block millions of websites and messaging apps and carry out covert surveillance of internet activity.

Sandvine representatives didn’t immediately respond to a request for comment.

Two former Sandvine employees said the Commerce Department decision would likely be a major blow for the company, which they said utilizes components in its technology from US companies such as Dell Inc. Dell didn’t immediately respond to a request for comment.

The Commerce Department’s decision comes after Bloomberg News reported in September that Sandvine had made sales worth more than $30 million in Egypt, including to state-owned Telecom Egypt, Vodafone Egypt and to government agencies including Egypt’s Ministry of Defense and the National Telecom Regulation Authority.

Egypt was one of at least a dozen countries where Sandvine’s equipment had been used by governments to censor content on the internet, Bloomberg News previously reported. The company’s systems also appeared to have been utilized to enable attempts to hack the iPhone of a presidential candidate, according to security researchers.

In Belarus, Sandvine sold its equipment to a state-controlled internet agency, which used the technology in August 2020 to block social media platforms, messaging apps and news websites amid nationwide protests over a disputed presidential election. After criticism from human rights groups and US Senators, Sandvine later announced that it would no longer work with Belarus, saying that it abhorred “the use of technology to suppress the free flow of information resulting in human rights violations.”

The company, originally founded in Canada, was acquired by San Francisco-based private equity firm Francisco Partners and combined with Procera Networks in 2017, in a deal worth $444 million.

(Updated to include additional information in fifth paragraph.)