When choosing a cloud platform or video communications API, one question always arises: Does GDPR require data to be physically stored in the European Union (EU)?
If you’re comparing vendors for SaaS, healthcare, education or public sector applications, this article offers clarity and will help you make the right choice. We’ll break down the legal regulations in simple language, explain key concepts like data localisation and jurisdiction, and help you make an informed decision that reduces legal risk without overcomplicating your tech stack and causing you extra costs.
Data location has become a key decision-making factor for compliance officers, CTOs, and product owners alike — especially in industries handling sensitive or regulated information. As governments, regulators and users demand higher standards of privacy and accountability, choosing the wrong vendor can lead to hidden legal exposure and operational issues. This makes understanding the connection between GDPR, server location, and jurisdiction on both the European and the national levels more critical than ever.
Table of contents
Let us focus first on the main question:
Does the GDPR require personal data to be stored exclusively in the EU?
No, the GDPR does not mandate that data must physically reside within the European Union. However, it does heavily regulate any transfer of personal data to countries outside the European Economic Area (EEA).
This nuance is crucial and easily misinterpreted. You are not legally required to use EU-only servers, but the moment you store or process personal data outside the EEA — or allow access from outside — Chapter V of the GDPR (Articles 44–50) applies.
These provisions are designed to ensure that the same level of protection guaranteed within the EU travels with the data, even beyond its borders.
Let’s look at the key legal instruments from Chapter V:
Because even if the data is physically stored in the EU, if the service provider is based in a non-adequate third country, such as the United States, the GDPR treats this as a restricted transfer.
This position was solidified in the Schrems II judgment (CJEU Case C-311/18, 2020), which invalidated the EU–US Privacy Shield framework. The court found that:
As a result:
This creates an ongoing legal burden, especially for SMEs, public institutions, and EU-funded projects with limited compliance resources.
The simplest way to avoid this legal overhead is to keep data within the EEA or transfer only to “adequate” countries recognised by the European Commission under Article 45. These countries are deemed adequate because their national laws and enforcement frameworks ensure a level of personal data protection that is essentially equivalent to that guaranteed within the EU.
As of 2025, the list of countries with full adequacy decisions includes:
The United States is not on this list, though a new adequacy framework, the EU–US Data Privacy Framework, is under discussion. Its long-term viability remains uncertain due to expected legal challenges.
If you choose a provider that:
then Chapter V of the GDPR doesn’t apply at all. There is no “transfer” as defined by the law — therefore:
|
Scenario |
Legal risk |
Compliance murden |
|
EU-hosted, EU-owned provider |
🟢 Low |
🟢 Minimal |
|
EU-hosted, US-owned provider |
🔴 High |
🔴 Requires SCC + TIA + extras |
|
US-hosted, US-owned provider |
🔴 Very High |
🔴 Extensive |
|
Transfers to “adequate” countries |
🟡 Medium |
🟡 Still requires documentation |
|
Transfers under Article 49 derogations |
🔴 High |
🔴 Only for exceptional use |
While GDPR does not mandate EU data hosting, keeping data inside the EEA under EU jurisdiction is by far the easiest and safest path — especially for regulated sectors and risk-sensitive organisations.
These three terms, namely data residency, jurisdiction, and sovereignty, are often confused or used interchangeably. But for your compliance strategy, it's important to understand the distinctions.
|
Term |
What it means |
Why it matters |
|
Data residency |
Where your data is physically stored |
Affects legal exposure and local privacy rules |
|
Jurisdiction |
Which country’s courts and authorities can access the data |
Determines whether your data is subject to EU law or foreign surveillance regimes |
|
Data sovereignty |
The principle that data is governed by the laws of the country where it is stored |
Key for public sector, healthcare, and GDPR-aligned operations |
Example
If your provider is headquartered outside of the European Economic Area (EEA) or is otherwise subject to a third country’s legal system, GDPR treats this as a restricted transfer — even if the servers themselves are located inside the EU.
Take the example of a US-based company that runs data centres in Germany:
This is why you can often hear compliance teams say that “It’s not just where the servers are — it’s who controls them.”
By contrast, if your provider is both hosted and owned under EU jurisdiction, no third-country laws apply, and no transfer rules are triggered. That’s why EU-owned and operated vendors (like Digital Samba) remove this layer of complexity altogether.
This makes pure EU jurisdiction and ownership essential for certain sectors.
GDPR Article 44 and the Schrems II ruling of 2020 made it clear: sending personal data outside the EU is high-risk unless the recipient country offers adequate protection.
Bottom line: Cross-border transfers are not illegal, but they are burdensome, fragile, and often incompatible with real-world compliance needs. For many organisations, choosing an EU-hosted and EU-owned provider is the most future-proof and legally resilient approach.
Let’s translate all of the above into practical decision-making.
When evaluating cloud, video, or communications vendors, here’s how fully EU-hosted platforms simplify compliance:
No need to sign additional contracts or perform transfer impact assessments — you're not transferring data outside EU borders at all.
→ This significantly reduces your legal workload and speeds up your procurement or integration timeline.
Your data is shielded from non-EU laws like the US CLOUD Act or FISA.
→ This ensures that only EU courts and data protection authorities have legal authority over your users' personal data.
Procurement becomes easier when the provider is entirely within the EEA and under EU law.
→ You can streamline compliance checks and confidently report alignment with GDPR and national regulations.
You reduce the time and money spent on compliance tasks, freeing resources for actual innovation.
→ This is especially beneficial for SMEs and startups with limited legal or privacy staff.
Healthcare platforms, EdTech tools, and public institutions increasingly require EU-only vendors in tenders and audits.
→ By choosing an EU provider, you pre-qualify for privacy-sensitive contracts without needing special data exemptions.
At Digital Samba, we’ve designed our platform from the ground up to meet the expectations of EU-based teams — especially those handling sensitive or regulated data.
Here’s what makes us different:
Whether you're building a video classroom, a secure telehealth app, or migrating communications infrastructure, we eliminate the legal guesswork.
Not directly — but practically, yes, for many use cases.
While the regulation permits international data transfers under strict conditions, these have become difficult to meet in a legally sustainable way.
If you're handling sensitive data, operating in a regulated industry, or working on publicly funded EU projects, then choosing an EU-hosted and EU-governed provider is more than a compliance shortcut — it’s a strategic advantage.
As the data protection landscape evolves, clarity and simplicity are crucial. Choosing providers who are aligned with EU values, laws, and jurisdiction is not just about ticking boxes — it’s about earning trust and ensuring resilience.
Whether you're a product owner, IT lead or compliance officer, hosting data entirely within the EU eliminates legal ambiguity, simplifies vendor management, and protects your users.
Digital Samba stands ready to support you with privacy-first, fully EU-hosted infrastructure — built for teams who care about compliance and user trust.
Book a demo and see how easy privacy can be.
Residency refers to where data is physically stored — often called GDPR data residency requirements. Jurisdiction refers to who has legal authority over that data. Both matter for GDPR compliance and directly impact data sovereignty in the EU.
Technically, yes, but it’s risky. Even if data meets GDPR data storage location requirements, the US CLOUD Act may still apply. You’ll also need additional contracts and assessments to remain GDPR compliant.
SCCs are a valid mechanism, but only when combined with a Transfer Impact Assessment and, if needed, supplementary measures. This makes compliance with GDPR data storage requirements and cross-border transfers more complex.
Yes. Digital Samba is fully hosted and governed within the EU. We meet GDPR data centre requirements and procurement rules for education, healthcare, government, and EU-funded projects.
Healthcare, education, government, legal, and finance — or any organisation handling sensitive data or serving EU citizens where data localisation requirements are critical.
Check their ownership structure, sub-processor list, and data processing agreements. If they’re US-owned, even with EU servers, foreign laws may still apply.
Yes. GDPR doesn’t strictly require data localisation, but EU personal data must always be protected by GDPR standards. In practice, many sectors prefer EU-only hosting to avoid foreign laws and simplify compliance.
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