On December 19, 2014, citing the government's draft law relating to the organisation of the Luxembourg State Intelligence Service, an opinion provided by the Council of State noted with amazement : « It appears that neither the Government nor indeed the parliamentary committee of inquiry on the State Intelligence Service, established by decision of Parliament on December 4, 2012, intend to call into question the usefulness of a state service in charge of intelligence. »
The opinion echoed an earlier parliamentary report dated July 5, 2013. The report mentioned that the « usefulness of an intelligence service has not been called into question given that intelligence is essential for the protection and safeguarding of the interests of Luxembourg, a country of democracy and rule of law ».
Though such remarks are reminiscent of debates that occupied the international intelligence community at the end of the Cold War some twenty-five years ago, these comments serve to underline the ignorance of Luxembourg's decision-makers, both judicial and parliamentary, with regard to their Intelligence Service. As strange as it may appear for a Western democracy, such ignorance is the result of this young monarchy's myopic approach to the study of contemporary history. The Grand Duchy of Luxembourg has shown great disinterest for its recent political history while maintaining an intense focus on the controversies of the Second World War. This disdain for contemporary history and a disproportionate preoccupation with memories of World War II has resulted in a lack of understanding of the country's intelligence requirements. Luxembourg has long believed in the benefits of its neutrality and this has led to another widespread belief that the only use for an intelligence service is to be found within the framework of the country's international commitments since 1945. The context of the Cold War only deepened the misunderstanding, because of a Communist audience more powerful than its low parliamentary representation would suggest. Consequently, for political decision-makers the State Intelligence Service is a necessary evil and only the war on terrorism allows it to play its role as an instrument of state action. In the minds of the public, however, the intelligence service remains a Spitzeldienst (an espionage service) which harks back to the reviled period of the German occupation as well as to the political divisions of the Cold War.
Luxembourg's disdain for its intelligence service is not a consequence of a political scandal such as the Dreyfus Affair in France. Rather, it emerged in the wake of two German military occupations during both world wars. The mass arrests in Luxembourg by the occupier's military and political police led to widespread distrust of the gendarmes who shed their uniforms on the eve of 1914 for civilian clothing. They did so in order to modernise the fight against rising crime rates that accompanied the surge in the labouring population employed by the country's steel industry. Rather than increasing the numbers of local police and gendarmerie, which would have led to a rise in running costs, Luxembourg sought to rationalise the resources needed to fight crime. Echoing a trend seen in neighbouring countries (France, Belgium and Germany), intelligence gathering and the coordination of police information were prioritised. In 1903, a first crime desk composed of three non-commissioned officers was established to « search for criminals » in coordination with the « investigating judge » in order to prepare the « initial evidence in affairs of exceptional seriousness ». However, introduced by the Luxembourg Department of Public Prosecutions, the experiment did not last long on account of the disinterest shown by the magistrates. Beginning in 1910, the government sought to improve its « judicial police service » based on Belgian practices, while also asking its legation in Paris to provide information on the methods of the Préfecture de Police in Paris and its project to establish mobile brigades.
The French « Security Service » model was chosen. Two gendarmes and an officer were sent to Paris on an internship in the autumn of 1911, and a third in the spring of 1914. On December 27, 1913, a public « security service (Sicherheitsdienst) » was established under the form of a « mobile brigade (...) called on to operate throughout the country », with instructions to « operate abroad » if required. The service was also called on to « support the judicial authorities in the investigation of crimes and misdemeanours » and to ensure the coordination of the activities of the gendarmerie and local police. This meant that it was necessary to establish a « research bureau », in order to centralise domestic intelligence. With the development of the steel industry and the influx of Italian migrant workers, and in the wake of the upheavals in European geopolitics following the First World War, both in Russia and Italy as well as in Germany, the Department of Public Security added a « political desk » in November 1929, whose missions extended to espionage in April 1936 and propaganda the following October. The Second World War led to the dismantling of this structure, with its agents redeployed by the occupying German authorities to the Kriminalpolizeiamt (criminal police), Amt V of the Reichssicherheitshauptamt. While in exile, the government of Luxembourg first established as an emergency measure in July 1940 an intelligence service in Vichy, in liaison with the Ministry of Foreign Affairs located first in Lisbon and then in London. The invasion of France's Free Zone in November 1942 and the ambition of Luxembourg's exiled Minister of Justice to recover full powers over domestic intelligence operations led to the establishment of a Special Intelligence and Air Service. Modelled on the British Special Operations Executive and spurred on by the Belgian state security service with whom they collaborated, it first took the form of an « embryonic intelligence service without official accreditation », in charge of establishing « direct contact with the resistance organisations of the Grand Duchy ». It was officially established by a Grand Ducal Decree on April 31, 1943. The Ministry of Justice's takeover of the intelligence service underlined the short-lived nature of the Special Service, as it lasted only as long as the events that led to its foundation. At the Liberation of the Grand Duchy, on September 10, 1944, the gendarmes deployed at the Kriminalpolizeiamt regained their posts within the Department of Public Security. The Special Service was dissolved in March 1945.
Established by law on July 30, 1960, the State Intelligence Service (Service de renseignement de l'Etat - SRE) was the logical continuation of this evolution. At first glance it appeared to resurrect the Special Service minus the parachutists. Lawmakers indeed gave the service: « the mission to ensure the safeguarding of secrets (...) and research of information that the protection of the external security of the Grand Duchy of Luxembourg and of the states with which it is united by a regional common defence treaty requires ».
Having abandoned its age-old neutrality, the country became a member of the Atlantic Alliance (NATO) in 1949. It had also been a rear operating base in the secret war led first by the French intelligence services and then by American intelligence. The former sought to maintain their influence on the country, under threat from their British counterparts who had mentored the Luxembourg intelligence structures during the war; however, operations aimed at destabilising agents from London, both within the government in exile as well as within the ranks of Luxembourg's new, young army, resulted in a political crisis which led Paris to recall its military attaché, the cover used by its intelligence service station leader. The US intelligence services quickly saw an advantage in working in the Grand Duchy where the police and the gendarmerie were never very concerned, on account of their lack of training, about operations by foreign intelligence services. The heightened tensions of the Cold War did lead the Central Intelligence Agency (CIA), active in Luxembourg since 1950, to lobby for the establishment of a real intelligence service, that is to say, a body without the powers of the judicial police.
The capabilities of Luxembourg were, however, limited. After reorganisation in the Spring of 1946, the Public Security Department had a political desk (III), in charge of counter-intelligence (1st Bureau), policing of foreign nationals (2nd Bureau) and domestic intelligence (3rd Bureau), and shared a military desk (IV) with the Army Chief of Staff. The latter constituted in fact the 2nd Bureau of the Army Chief of Staff, modelled on technical advice from the French secret service, but in reality it was in charge of military security (defence against subversives and security of military sites) rather than intelligence of military interest. The effects of the law of 1960, despite money from the CIA, as in Holland, were limited to withdrawing political and military competencies from the Department of Public Security, just as the Chief of Staff had its 2nd Bureau withdrawn, in order to establish the SRE. It was in this way, as the French ambassador to Luxembourg remarked, that Luxembourg established its « Counter-Intelligence Service ». These was no hint of disdain in the remark, simply an observation that gendarmes from the Department of Public Security and military servicemen from the 2nd Bureau were detached to establish the new SRE ; even though the articles of the law of 1960 mention « agents detached from other public services », the service had to wait until the end of the Cold War before civilian personnel could join its ranks. Up to that point, the precautionary attitude of senior officials at the head of the Grand Duchy's administration regarding this Spitzeldienst so often criticised in the press, including in the conservative press, made them reluctant to send their best elements to the SRE. In a society where the Communist Party had an audience far wider than its actual number of electors, the public's poor opinion of the new structure deepened the contempt with which members of the Department of Public Security had been held since 1945. Such contempt also stemmed from the fact that SRE's domestic intelligence missions were carried out by the same men who, either at the Department of Public Security or at the 2nd Bureau, had conducted them up until that date. Indeed, to become an official in the Grand Duchy, military service was a prerequisite.
Starting in February 1946, the question of military service, made compulsory in 1944 by the Luxembourg government returned from exile, after it had been made obligatory by the Nazi Gauleiter two years previously, crystallised criticism within public debate until the service was abolished in 1967. It was also a domestic intelligence issue, adding to the discourse that had tainted the legitimacy of government since 1944. A report dated July 1946 from the Communications Control Center (Office du contrôle des communications), which operated from May 1945 to April 1947, summed up the driving force behind the anger of the Luxembourg people, stipulating that the anger resulted from « youthful, impatient ambitions, senile resentments, social rancour, hatred and enmity which continually pits man against man ». The ideological nature of the Cold War, which began with the resignation of the national unity government on March 1, 1947, changed the situation given that the Communist enemy within now represented the main threat abroad. Carrying forward the work of the Department of Public Security's political desk and the 2nd Bureau, the SRE continued to monitor the entire far-left movement of the country, just as it continued to monitor the residual far-right. In both cases, it continued the collaboration established (1954 - 1956) between the 2nd Bureau and the Bundesamt für Verfassungsschutz (Federal Office for the Protection of the Constitution), because the intellectual center of the two movements under surveillance was West Germany.
Collaboration with the CIA also predated the establishment of the SRE. Initial contact was made in 1950 with the Office of Special Investigations, at Bitburg Air Force Base. When the Chief of the 2nd Bureau was received in July 1958 at the headquarters of the Agency, a partnership was established that centered around the monitoring of Soviet activities in Luxembourg. An embassy was opened, with a staff of forty, even though only between three and six diplomats were officially accredited, in addition to the ambassador. As of 1962, a resident of the Komitet Gosudarstvennoy Bezopasnosti (KGB), sometimes acting under diplomatic cover, was active in Luxembourg. The Central Committee of the Communist Party of the Soviet Union via its Department for Liaison with Communist Parties began to fund the Communist Party of Luxembourg in 1951. In 1958, it granted the party additional financial assistance. Such activity constituted interference and intrusion by a foreign power in the affairs of the state of Luxembourg as well acts of espionage. In the first instance, citizens of Luxembourg and members of the Communist Party were vulnerable to recruitment by the KGB, in-country or while travelling in Eastern Europe. In the second instance, case officers from the intelligence services allied to the KGB carried out their intelligence work; the arrest and expulsion of Stefan Staszczak during a joint operation by the SRE and the Department of Public Security was a point in case. This member of the Polish trade mission located near the Polish embassy in The Hague was arrested in 1967 just after he had received from one of his contacts highly confidential information on NATO's Maintenance and Supply Organisation's planned move to Capellen.
The Soviet threat was not limited to the sole risks of interference, intrusion and espionage. The threat was also of a military nature. As of 1957, the 2nd Bureau had appointed an officer to participate in the Stay Behind networks, coordinated by the French, British and American intelligence services since 1949 and housed within NATO's Supreme Allied Command. Three years later, the operation logically fell within the remit of the SRE, which turned it into a service separate from « Operations » and « Security » known as « Plan », that is to say, « in charge of the preparation of all plans concerning special missions ». Soon after having established a weapons cache (1973), the structure soon lost its raison d'être. Radio exercises and European-level meetings did continue, however, until the structure was dissolved in November 1990.
Nevertheless, at the Munich Olympic Games (1972) a new threat emerged, that of terrorism. The Grand Duchy was spared this danger, apart from an episode between 1984 and 1986, known locally as « Bommeleeër » (bomb planter). The international connections of the bomber proved impossible to establish; the SRE did participate in the fight against euroterrorism, both its international and far-left manifestations. At the time when West Germany was threatened by the Baader-Meinhof gang, the service searched for possible traces of terrorists in Luxembourg. It emerged that one of the members had in fact stayed overnight at a hotel there, but the service was unable to discern the reasons. This collaboration, both international and internal, did not disappear with the end of the Cold War. On the contrary, since September 11, 2001, the fight against terrorism replaced, as far as the SRE was concerned, the fight to contain communism; this was all the more true given that terrorists presented a range of threats caused by the collapse of the international world order that had prevailed between 1947 and 1990; such threats included « proliferation of non-conventional weapons systems and associated technologies or organised crime to the extent that the latter is connected with the aforementioned threats. » In 2008, for example, the SRE revealed that one of the Iranian intermediaries of a Luxembourg freight company, Cargolux, was involved in contraband cigarette smuggling; there was a risk of proliferation, and the operative was also acting as a front for Iranian intelligence. The investigation also revealed the vulnerability of the company to a hostile takeover. The Ministry of Economy and Trade undertook legal proceedings.
International uncertainty at the end of the Cold War made political and administrative decision-makers in Luxembourg change their view of SRE. For the first time in its forty years of existence, the service now operated with real guidelines on the intelligence to be prioritised and gathered. The intelligence service was no longer seen as a necessary evil, or as a potential danger to democracy. Such a danger had led a government leader in 1976 to seek advice from NATO on the conditions for dismantling the service while still remaining a member of the organisation. It is true that his party had not been in power for many years. When he took office, he discovered that he was legally responsible for the SRE. His surprise, as well as his disdain, underlined the long misunderstanding that had existed between the service and society at large. The roots of this misunderstanding were decades old, stretching back to World War I and the attitude of the German Zentralpolizeistelle, which systematically wiretapped all telephone communications. This sensitivity to the issue of wiretaps became a political football for liberal majority governments and was used skilfully by left-wing parties, both socialist and communist. A journalist was even able to build up a promising career within the Socialist Party by claiming that his phone had been bugged during the summer of 1967. Forty-five years later, the political class was to use this argument again to assign liability to the SRE. A right-wing Prime Minister even used the same excuse as recently as 2013!
He was, however, one of the rare government leaders, with the exception of his predecessor in office between 1959 and 1974 and his successor, to show some interest in intelligence. He introduced reforms to modernise the SRE and its missions by passing a law to reorganise the intelligence service in 2004, that established in particular a parliamentary committee, « composed of presidents of political groups represented in Parliament ». This replaced the possibilities afforded to MPs within the framework of the law of 1960: as part of the parliamentary review of the bill that they voted, they now had actual oversight. In 1969, at the end of the judicial inquiry into the phone tapping of the journalist, the then Prime Minister mentioned such oversight to the members of Parliament. But members of Parliament chose to get mired down in endless debates (1982-1984 for example) on wiretapping. Following the revelation of the existence of secret Stay Behind networks in the autumn of 1990, within the framework of the investigations that had been abandoned and then taken up again on the « Bommeleeër » affair, a trial began in the spring of 2013. A lawyer, who had campaigned in his youth for Vietnam-Luxembourg friendship, claimed that the SRE was responsible for the series of bombings. In 2008, the SRE Parliamentary Oversight Committee drafted two reports on each of these questions. Though of purely historical interest, the Committee concluded that there was « no evidence to suggest that the intelligence service had exceeded its mandate granted to it by government and legislation ». Five years later, the political situation having changed, the Committee handed in a more critical report, in connection with the wiretaps as revealed by the Prime Minister. And it compiled a list of « actions and malfunctions known and revealed up to the date of writing; given the frequency of the disclosures, they reveal that revelations relating to excesses that characterised the way the State Intelligence Service operated in the years between 2004 and 2008 were strategically orchestrated through the press ».
There resulted a series of six conclusions, centered on a code of ethics for SRE personnel and aimed at rectifying the flawed coordination between the service and the police. In an inventory worthy of Prévert, ten recommendations proposed not only to reform the legal framework of the activities of the SRE and to oblige the service to give back to the Treasury of Luxembourg the gold coins of the Stay Behind networks, but recommendations also outlined a legal framework for private business intelligence. These recommendations were taken up without further consultation as part of draft legislation on the Information Society in an opinion drafted by the Council of State in December 2014, for a new framework law on the SRE, the second in ten years! These proposals sought more to rectify errors of management than to better allocate intelligence resources between the different agencies, both on an economic and military level. The disappearance of the 2nd Bureau, organically attached to the 3rd Bureau (operations), meant that the SRE was obliged to maintain a military dimension, to enable the service to respond to requests from military intelligence agencies of NATO forces and to participate at meetings on this issue. Since then, the Army has refused to support SRE's participation, making the Army the last stronghold to still maintain reservations about the intelligence service.
The development of the intelligence services of the Grand Duchy of Luxembourg is part of the history of European intelligence. The structuring of the services in 1960, bringing together personnel from the gendarmerie and the Army, reflect the historical specificities of the country. The role played by the CIA in guiding these developments was similar to the role played by the US agency in Germany and Holland. There the CIA both spurred on legislation, despite the fact that major European powers at the time structured their intelligence services by executive decree, and initiated fruitful cooperation in both intelligence and economic matters. The common beliefs that continue to hold sway among the population of Luxembourg regarding the SRE include the familiar denunciation of secret actors in politics that fuels regular periods of spy mania and scandal. Elsewhere in Europe, hostility to the intelligence community usually takes on a nationalist or irredentist guise. In Luxembourg, the deep-seated neutrality of the Luxembourg people means that they continue to blame « the covert action of the police, the secret policies of the state, of such and such a political group, (...) and those that serve them, the informers and spies ».