European Data Sovereignty: the Business Accelerator

Achieving Data Protection in European Cloud Environments

The principle of data sovereignty guides organisations to ensure that their data is and remains subject to the laws and legal jurisdiction of a certain country and is protected against direct influence and access by third-country governments. To achieve data sovereignty, organisations need to consider the geographical location of their data and possible service providers as well as the integrity of their infrastructure, technology and operations relating to data.

In the cloud native age, where data can be stored in any corner of the globe, data sovereignty has become all the more important.

Organizations managing cloud native workloads are navigating an ever-evolving landscape of data protection regulations, cybersecurity risks, and market uncertainties. Amid the current geopolitical instability and renewed scrutiny around international data transfers under the EU-U.S. Data Privacy Framework, running secure cloud services that are compliant with European regulation, has never been more critical to maintaining data sovereignty, securing customer data, and accelerating business.

The demand for trusted, locally anchored infrastructure is growing rapidly. UpCloud stands out through its focus on performance, transparency, and European values, helping businesses ensure data sovereignty and security with a truly global reach.

— Arno Schäfer, CEO @ UpCloud

This commitment to European values and data sovereignty was a key factor in the partnership between UpCloud and TAGGRS. Facilitated by strategic partners Pionative, TAGGRS sought a European cloud alternative to ensure compliance with European data regulations and uphold data sovereignty, moving away from American hyperscalers.

Together with TAGGRS, we redefine data-driven success, ensuring speed, security, and seamless control while staying true to privacy and compliance within the EU. In light of the current geopolitical situation, this is no longer just a compliance question, many companies see truly European hosting as a clear differentiator in the market.

— Mikael Storbjörk, Partner Manager @ UpCloud

In this blog, we’ll look into the robust regulations that have made Europe a cloud native leader, and things to look out for if you’re already hosting, or planning to move your data, to the EU just like TAGGRS some months ago.

Your data, your choice

Being able to choose the jurisdiction where you host your data is one of the greatest benefits of cloud. However, compliance requirements regarding laws and regulations are not uniform across all companies. They depend on the jurisdiction in which your business operates, where your users are based, and the industry of the business. For example, the EU General Data Protection Regulation (GDPR) imposes rules on data protection and privacy for organisations that are based in the European Union or processing personal data of EU residents.

Understanding applicable data residency requirements is crucial when selecting cloud regions to ensure compliance with the data transfer restrictions imposed by data protection laws, authority guidelines or your customers’ requirements. It’s also important to ensure the whole supply chain, including possible sub-processors of your cloud service provider (CSP), comply with your data residency requirements.

Failure to comply with regional laws can result in severe penalties, reputational damage, and loss of customer trust. In highly regulated industries such as finance, healthcare, and government services, where sensitive data is at the core of operations, ensuring compliance and maintaining strict data control is mission-critical.

Vote for robust security

Cloud security standards are a set of requirements designed to ensure the security of data and workloads in cloud computing environments, encompassing a range of considerations, from the physical security of data centers to the protocols for data transmission. Europe enforces the most robust data protection regulations in the world, but maintaining compliance can considerably accelerate your business growth on the Continent.

Different organizations and specific use cases may require different standards. One of the most well-known frameworks for information security management systems is ISO/IEC 27001:2022, which provides guidance for establishing, implementing, maintaining and continually improving an information security management system. This standard is not a one-off certification. Holders are regularly audited by an independent third party to ensure adherence to high standards and the efficiency of security controls. Choosing a CSP with an up-to-date ISO 27001 certification is a vote for robust data security management.

It’s also worth looking for providers that are aligned to the The Cloud Infrastructure Services Providers in Europe (CISPE) code of conduct –  a non-profit organisation with members that include OVH, Hetzner, Leaseweb, Aruba, and UpCloud. The CISPE Code of Conduct focuses on data protection principles, and adhering to this ensures that your data remains within your control, isn’t used for anything other than what you’ve authorized, and remains in the EEA (EU countries, Norway, Liechtenstein, and Iceland), providing an additional layer of protection given the stringent data protection laws in place.

Beyond baseline compliance

When migrating to a European Cloud, choose a CSP that complies with the EU Regulatory Framework on Data, not just GDPR, to enter new markets faster with a well-rounded compliance strategy.

Here are just some of the laws that European business must adhere to:

• Digital Services Act (2024) – prevents illegal and harmful activities and content, protects fundamental rights, and obligates the removal of illegal content.
• NIS2 (2024) – the Network and Information Security directive established a unified legal framework to uphold cybersecurity in 18 critical sectors across the EU.
• DORA (2025) – governs ICT risk management, mandating cyber resilience for the financial sector and their service providers.
• Data Act (2025) – prevents vendor-locks and prohibits unfair contract terms.
• ESG directives – while the Corporate Sustainability Reporting directive governs data service providers, many CSPs like UpCloud choose to operate transparently and openly share ESG reporting. 

Compliance is a shared responsibility

Hosting in the EU, or considering a move? Make sure you establish clear compliance requirements based on industry regulations, legal obligations, and internal policies. This will ensure a structured approach to maintaining security and regulatory adherence in the cloud.

It’s worth remembering that cloud compliance is a shared duty between CSPs and their customers. By sharing the responsibility, both play active roles in ensuring a secure cloud environment, reducing the risks of data breaches.

While CSPs concentrate on securing the underlying infrastructure and may offer tools to support compliance efforts, customers must oversee proper data governance, access controls, and adherence to industry regulations within their cloud environment. The division of responsibilities may vary depending on the type of cloud service in use (such as SaaS, PaaS, and Iaas) so it’s important to pay attention to your role and responsibilities with a specific cloud provider.

UpCloud: secure and reliable by design

UpCloud offers a future-proof solution for organizations that demand both high performance and regulatory compliance. Headquartered in Helsinki, Finland, UpCloud operates a global network of 13 data centers across four continents, alongside managed cloud services engineered for performance, scalability, privacy, and security.

At UpCloud, we are committed to complying with European data protection laws and compliance with ISO 27001. This international standard not only signifies our dedication to maintaining a high level of information security but also ensures that we adhere to recognized best practices in managing and safeguarding your data.

To ensure a comprehensive and multi-faceted approach to security, we are aligned with ISO31000:2018 and NIST CSF. We also have a bug bounty program and offer a public Vulnerability Disclosure Program for reporting vulnerabilities. Alongside, we are certified and audited annually to ensure we remain committed and aligned to the CISPE Code of Conduct.

To strengthen our European data residency, we also have an EU Access Management Policy in place, ensuring only EU-based employees have privileged full remote access to operating systems within our EU data centres. 

UpCloud is dedicated to helping our customers future-proof their cloud strategy and safeguard sensitive data - just take it from our valued customers TAGGRS!