German newspaper Spiegel reports that Google is threatening to shut down the German version of its Gmail email service if new laws effecting privacy are introduced.

The legislation planned for next year would require internet providers to store all emails and make users identifiable, which goes against Google’s practice of also offering anonymous email accounts. The Government plans are reportedly an anti-terrorist ploy with some reports suggesting new email accounts may need to be verified by letter.

Heise online quotes Google’s Peter Fleischer saying: “Many users around the globe make use of this anonymity to defend themselves from spam, or government repression of free speech. If the web community won’t trust us with handling their data with great care, we’ll go down in no time.”

German websites and blogs have advised users to backup any important Gmail correspondence before Google acts. Jens Minor from the German Google Watch Blog sees a bleak future for Google in Germany if Gmail is forced to close.

“If Google will indeed stop their email service in the sense that no one will be able to access their mails anymore, they might as well close all local subsidiaries, and Mountain View can go ahead and forget this market because they’d destroy all user trust from one day to another.”