In the wake of the Schrems II decision[1], and even more in the light of Friday’s Facebook ruling[2], the question on everyone’s mind is how to truly protect personal data from the prying eyes of national security agencies around the world. Despite detailed guidelines[3] issued in November 2020, in the absence of new definitive guidelines for transferring data across European borders[4], many are starting to wonder whether data localisation is the magic bullet to protect personal data.
The terms ‘data sovereignty’, ‘data residency’ and ‘data localization’ are a source of confusion for most people. They are effectively three degrees of a single concept: how data privacy impacts cross-border data flows. This subject has become increasingly important following the Schrems II decision and its requirement that organizations when processing personal data must ensure their privacy is not put at risk and subject to governmental surveillance when shared across borders.
Data residency refers to the country where an organisation specifies that its data is stored, usually for regulatory or policy reasons. A common data residency requirement example is for tax purposes: to prove an organisation conducts a greater portion of its business in a given country, it will put in place an infrastructure that requires a strict data management in order to protect its taxation rights.
Data sovereignty differs from data residency in that not only is the data stored in a designated location, but it is also subject to the l ..
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