Australian telecommunications company Telstra had reportedly agreed to store all user communications for surveillance by US intelligence agencies.
According to The Age, Telstra had agreed more than a decade ago to store huge volumes of electronic communications it carried between Asia and America involving a US point of contact through a secure storage facility on US soil that was staffed exclusively by US citizens carrying a top-level security clearance.
The report said that the data collected by Telstra under the 'network security agreement' includes actual content of emails, online messages and phone calls.
The US Department of Justice and Federal Bureau of Investigation had demanded that Telstra must provide technical or other assistance to facilitate electronic surveillance.
Telstra had negotiated with a Hong Kong company to launch Reach, which would become the largest carrier of intercontinental telecommunications in Asia. The venture's assets included not just the fibre-optic cables, but also 'landing points' and licences around the world.
The then company secretary of Telstra, Douglas Gration, who had signed the document, said that every country has a regime for lawful interception and Australia has got it as well.
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In 2011, Telstra and Pacific Century CyberWorks Ltd. (PCCW) restructured their partnership, giving Telstra control of the majority of Reach's undersea cables.
Telstra spokesman, Scott Whiffin, said that the agreement was required to 'comply with US domestic law' adding that when operating in any jurisdiction, in Australia or overseas, carriers are legally required to provide various forms of assistance to Government agencies.