In contrast, data localization demands that all data generated within a country's borders remains within them. In the case of data sovereignty, various data subjects will have different privacy and security regulations depending on the location of the data centers where the information is stored. Data sovereignty is not just about where the data is stored but also about the laws and regulations that govern the data at the location where it is physically stored. However, businesses must understand the differences in these terms to avoid significant fines for regulatory violations.ĭata residency refers to where the data is physically and geographically stored. How do data residency, data sovereignty and data localization differ?ĭata residency, sovereignty and localization are terms that often cause confusion because of some overlap.
SLAs with cloud providers should establish where customer data can and cannot be stored. Additionally, cloud users should make sure that their service-level agreements ( SLAs) with cloud providers establish where their data can and cannot be stored. To understand which data laws and regulations govern their data, users need to know where their cloud provider's data centers are located and research the data residency policies for each respective location. So, as cloud providers store data globally across different data center locations, users need to be aware of their data's local residency laws and regulations. Often, cloud computing customers are unaware of their data's physical location. However, when businesses deliver hosted services over the internet, they can create data residency concerns. Organizations that use cloud computing store data in the country where the data originated or beyond its borders. Similar to data sovereignty, data residency also relates to the data laws or regulatory requirements imposed on data based on the data laws that govern a country or region in which it resides.
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