In a world where you can easily transfer data between parties, consideration has to be made for data residency laws within differing regions. Transferring digital data hosted on the cloud poses questions about which jurisdiction should be applied and if the data is subject to the laws and governance structures of the nation where the data resides.
With the rise of cloud computing, many countries have passed various laws around control and data storage, which all reflect measures of data sovereignty requirements. As organizations worldwide adopt collaboration tools to enhance productivity and streamline communication, data sovereignty has emerged as a critical concern.
True sovereignty is more than just where data is stored—it encompasses control, compliance, and independence in a rapidly evolving regulatory landscape. In this post, we explore the three essential dimensions of data sovereignty: Software Sovereignty, Operational Sovereignty, and Data Sovereignty, and why they are crucial in today’s AI-driven world.
As a legal term, data sovereignty is extremely important as it is linked to data protection and security, especially in the cloud. The importance of data sovereignty has increased with cloud services growing fast in the last few years and businesses trusting cloud SaaS vendors with their data. However, they may be trading on not having full control of this data.
Data sovereignty laws provide guidelines for companies to follow around data and what to do. As it refers to the authority to dispose of data, putting this in the hands of third-party cloud vendors who are not following data sovereignty rules poses many questions about data ownership.
Companies need to consider what happens to the data once stored, who can access it, and how it is being protected. If none of these questions provides clear answers, they need urgent explanation. Before using any cloud service to handle data, you should be clear on how they will use it and how much control you have over it. As cloud servers can be located anywhere in the world, it needs to be clear data sovereignty is being adhered to for where your customers are based.
At the heart of software sovereignty lies the commitment to protect user data from unauthorized access and exploitation. It focuses on safeguarding data within the application itself while ensuring it adheres to strict privacy principles.
- Application Security: Collaboration tools must implement end-to-end encryption to secure data during transit and at rest, ensuring that sensitive information remains inaccessible to any unauthorized party, including the service provider.
- Data Privacy: Many collaboration platforms mine data for AI training, analytics, or resale to third parties. Sovereign solutions stand apart by adhering to a "No AI, No Data Mining, No Resell" policy, guaranteeing that user data is solely for the user’s benefit.
- Data Minimization: Collecting only the essential data and retaining it for the shortest time necessary ensures minimized risk and aligns with global privacy standards such as GDPR.
"Software sovereignty ensures users own their data, not the service provider."
By prioritizing software sovereignty, organizations can be confident their data remains secure, private, and solely under their control.
Operational sovereignty is essential for organizations to ensure secure, compliant, and efficient collaboration in a globalized digital environment. It centers on controlling where data resides, how it flows, and how it aligns with local and international regulations.
High-profile events like the US CLOUD Act exemplify why operational sovereignty matters. The Act allows US authorities to access data stored by US-based service providers, regardless of where the data originated. For businesses using global collaboration tools, this raises questions about who can access their data and under what legal authority. Without operational sovereignty, organizations risk exposing sensitive data to jurisdictional overreach, even if they comply with their local laws.
Sovereign collaboration platforms address these challenges by offering:
- Data Residency: Ensuring data is stored within specific geographic regions, meeting local data sovereignty laws. This protects businesses from conflicts like the one Microsoft faced in 2013, where US authorities sought access to email data stored in Ireland. With sovereign solutions, organizations retain peace of mind knowing their data complies with regional laws.
- Regulatory Compliance: Adhering to local and international legal frameworks, such as GDPR or Saudi Arabia’s Personal Data Protection Law (PDPL), ensures businesses meet industry and jurisdictional standards without compromising functionality.
- Localization: By tailoring data storage and processing to specific regions, sovereign tools mitigate risks associated with cross-border operations while maintaining control over sensitive information.
“Operational sovereignty is about knowing where your data lives, how it’s managed, and ensuring it complies with the right laws.”
For organizations adopting workplace collaboration tools, operational sovereignty ensures data flows securely and transparently throughout its lifecycle, supporting compliance and mitigating risks. This not only protects businesses from legal challenges but also enhances trust and efficiency in their operations.
Data sovereignty focuses on the legal authority and ownership of data, ensuring that organizations retain full control over their information without external interference.
- Authority: It’s vital to determine which legal jurisdiction governs the data. Sovereign solutions ensure that data remains subject to the laws of the organization’s choosing, preventing jurisdictional overreach by foreign governments or entities.
- Sustainable: Localizing data reduces the need for data to travel across multiple global data centers, minimizing energy consumption and carbon emissions. This localized approach not only enhances security by reducing exposure to vulnerabilities but also supports a more sustainable data ecosystem by ensuring that data is consumed and processed close to where it is generated.
- Ownership: True data sovereignty grants organizations full rights and independence over their data, ensuring they maintain control over access, usage, and distribution without dependency on external service providers.
"Data sovereignty ensures data is governed by the right laws, for the right owners."
With clear authority and ownership, organizations can mitigate risks related to jurisdictional conflicts and maintain their operational integrity.
A company must be careful when using the cloud to ensure they are data compliant and maintain data sovereignty. Having a sovereign cloud is important, but what exactly is a sovereign cloud? Simply, it ensures that the cloud platform you are using meets data privacy and access requirements. If your business is not using a sovereign cloud, it could mean the data breaches that country’s laws.
So, how can data sovereignty be implemented correctly when the landscape can be complex? This is where SaaS companies need to ensure they have data centers and servers in-country so that collecting, managing, or storing customer data is compliant for that region. Some third parties may be able to analyze and sell your data by storing it in another country. However, GDPR requires companies to use the highest data security and encryption levels.
Companies must ensure they retain data sovereignty at three stages – while in use, while being transmitted, and when stored locally or in the cloud. They need to ensure they have the technical and organizational measures to do so. Unfortunately, some companies may use platforms that do not provide the highest levels of security with all data. This is where using a platform built with privacy by design is essential, providing your business with peace of mind.
1. Work with trusted localized cloud providers – find those that provide in-country data centers and servers for your location to ensure data sovereignty.
2. Follow your country's data privacy regulation and sector-specific data protection and security compliance rules to ensure you meet the highest standards of data sovereignty.
3. Check where your backups are stored – ensure you know the location of your backups so that you can check these are compliant. You can then relocate your backups if required to uphold data sovereignty.
4. Be aware of the various challenges to being compliant. Laws can change and evolve regarding data sovereignty in different locations, and data mobility may be restricted in some locations compared to others. You also need to be prepared to be transparent about how your company is complying with data sovereignty.
Data sovereignty in the context of workplace collaboration goes beyond just infrastructure. While ensuring data remains within a defined geographic boundary is important, effective collaboration also requires addressing how data is accessed, managed, and stored across borders.
While storing data within national boundaries ensures compliance with data sovereignty laws, organizations must also consider how data is accessed. For instance, allowing employees to view or analyze data from other regions via secure tools may not violate sovereignty laws, but it requires robust access controls to prevent unauthorized use.
- On-Premises: Organizations host their servers and data locally, ensuring complete control and compliance with local regulations. Remote access, if needed, requires secure channels like VPNs to minimize risk.
- Cloud Solutions: Providers like AWS, Microsoft Azure, or Google Cloud often store data in servers across multiple countries. Vendors are increasingly establishing in-country data centers to address sovereignty concerns, enabling businesses to store data locally while leveraging the scalability of cloud services.
- Local Service Providers: Local providers specialize in meeting data localization requirements, ensuring that data remains within national borders and preventing cross-border data transfer. At RealTyme, we partner with trusted local service providers to ensure our clients' data never leaves the country, offering a seamless combination of compliance, security, and collaboration.
A collaboration platform must align with the principles of data sovereignty by:
- Guaranteeing data residency within specified regions.
- Enforcing data privacy standards to prevent mining, resale, or unauthorized sharing of user information.
- Supporting data minimization, retaining only what’s necessary to reduce risk.
Vendors must comply with local and international data protection laws such as GDPR, PDPL, or the CLOUD Act, ensuring organizations meet legal obligations without sacrificing functionality or security.
- Data Localization: Collaboration platforms must enable regulated data storage in designated regions to prevent cross-border transfer conflicts.
- Secure Access Controls: Implementing role-based access ensures that data is only accessible to authorized individuals, minimizing the risk of breaches.
- Transparency: Platforms should clearly outline how data is stored, accessed, and processed to help organizations maintain compliance and user trust.
While data sovereignty principles often focus on where data is stored, there is ambiguity regarding cross-border viewing. For many sectors, the consensus is that data should not leave the country of origin for storage purposes. However, accessing or analyzing data remotely through secure tools may be permissible, provided robust safeguards like encryption and auditing are in place.
At RealTyme, we know many businesses will have concerns over data sovereignty, which is why we can ensure this and more with our secure communications platform. Companies should not take risks when it comes to this, as the potential fines for not ensuring data sovereignty are significant, and the impact on your reputation will be in the long term. We take your data privacy seriously, and our platform follows strict guidelines.
We provide you with:
- Application Security: Robust end-to-end encryption ensures your data is protected both in transit and at rest, preventing unauthorized access at every stage.
- Data Privacy: RealTyme operates under a strict No AI, No Data Mining, No Third-Party Resell policy, guaranteeing that your data is used solely for your benefit.
- Data Minimization: Our platform collects and retains only the essential data, minimizing risk and adhering to global privacy standards such as GDPR.
- Data Residency: You maintain full control over how your data is stored and moved, with clear policies ensuring compliance with regional regulations.
- Regulation Compliance: Data is archived according to industry standards and jurisdiction-specific mandates, ensuring seamless adherence to GDPR, PDPL, and other frameworks.
- Localization: Sensitive, regulated data is stored in designated regions to meet jurisdictional requirements, providing peace of mind for international operations.
- Authority: Your data is governed by the laws of your choosing, protecting it from jurisdictional overreach or conflicts.
- Sustainability: Empowering local teams to be in control of localized systems nodes reduces computation impact and increases knowledge transfer.
- Ownership: RealTyme ensures that your organization retains full rights and independence over its data, granting you ultimate control over access, usage, and distribution.
To discover more about the RealTyme platform and the advanced features designed to ensure your organization, government, or business is fully secure, request an invite today.
