Data sovereignty is becoming increasingly important for Dutch organizations, especially as dependence on foreign tech giants grows. With new European legislation and increasing data protection concerns, companies face the challenge of maintaining control over their digital assets. In this article, we answer the most frequently asked questions about how data sovereignty works in practice and what steps you can take to protect your organization. From legal requirements to technical solutions, we give you a clear overview of what you need to know.
For many organizations, data sovereignty is still an abstract concept, but the consequences of non-compliance can be significant. Think fines of up to 4 percent of your global revenue under the AVG, or loss of trust from customers who aren’t sure their data is secure. With the right approach, you can avoid these risks while reaping the benefits of local data storage.
What is data sovereignty and why is it important?
Data sovereignty is the concept whereby organizations have complete control over where their data is stored, who has access to it and what jurisdiction the data falls under. It means that your data remains under Dutch or European law and is not subject to foreign regulations, such as the U.S. CLOUD Act.
The importance of data sovereignty has grown exponentially in recent years. Since the re-emergence of Donald Trump as president of the United States, calls for digital independence have grown stronger in Europe. At the same time, Dutch dependence on large U.S. tech companies is increasing, in part due to the growing use of AI services such as Microsoft Copilot and ChatGPT.
Data sovereignty offers tangible benefits to your organization. It stimulates local technology industries, creates technology jobs and strengthens competitiveness. Organizations can develop unique digital solutions faster without depending on foreign technology or regulations. Moreover, the money keeps circulating in the home economy, making it an investment rather than a cost.
What laws and regulations govern data sovereignty in the Netherlands?
The Netherlands and Europe have several laws regulating data sovereignty, with the General Data Protection Regulation (AVG) being the most important. This law, which went into effect in 2018, has set a global standard for data protection and imposes fines of up to 4 percent of global revenue for non-compliance.
The European Digital Strategy includes comprehensive initiatives on data management, digital infrastructure and innovation within the EU digital economy. This strategy provides the framework for further legislation around digital sovereignty. A major turning point was the invalidation of the EU-US Privacy Shield by the European Court of Justice in 2020, after which thousands of companies had to adjust their data transfers.
In addition, the AI Act regulates artificial intelligence, with an emphasis on security and transparency and with a particular focus on high-risk AI systems. The CHIPS Act focuses on strengthening Europe’s semiconductor capabilities, with the goal of doubling the EU market share in semiconductors by 2030. Together, these laws form a robust legal framework that helps organizations implement data sovereignty.
How do you determine where your company data may be stored?
Where your company data may be stored depends on the type of data, applicable laws and contractual obligations. For personal data under the AVG, storage within the EU is allowed, while storage outside the EU is only possible with adequate protection measures.
Start by classifying your data. Personal data, business confidential information and public data all have different requirements. Government agencies often have stricter requirements, with data preferably kept within Dutch borders. Healthcare organizations must consider medical privacy laws, which may have stricter localization requirements.
Also check your contractual obligations to customers. Many organizations have agreed to keep customer data within specific geographic boundaries. If in doubt, it is wise to seek legal advice, especially for international data flows. ISO 27001 certification can help in establishing policies for data localization and security measures.
What are the risks of storing data outside the Netherlands?
Data storage outside the Netherlands carries legal, operational and strategic risks. The biggest risk is that foreign governments can demand access to your data through legislation such as the U.S. CLOUD Act, even without your consent.
Legally, you run the risk of AVG fines if you cannot demonstrate that personal data is adequately protected when stored outside the EU. Operationally, data centers in other time zones can lead to longer response times when problems arise. You are also dependent on the political stability and cybersecurity of the host country.
Strategically, knowledge and experience flow away to foreign companies, weakening Dutch competitiveness. Government IT contracts tend to be large and are often awarded to international parties, causing tax money to flow to foreign tech companies. This highlights the importance of local alternatives that can deliver the same quality as international players.
How do you implement data sovereignty in your organization?
Implementing data sovereignty begins with a thorough inventory of your current data situation. Map out where all corporate data resides, who has access to it and what legal frameworks it falls under. Then create a step-by-step roadmap to move to sovereign solutions.
Technically, building an independent digital infrastructure with robust cybersecurity requires significant expertise and ongoing investment. Therefore, start with the most critical data and work toward less sensitive information. Choose vendors committed to Dutch or European data localization.
Economically, the cost of developing domestic technologies is initially high, but in the long run you save on compliance costs and avoid fines. Legally and governance-wise, you have to navigate changing and sometimes conflicting legal and regulatory frameworks while continuing to drive innovation. Establish clear procedures and train your staff in the new practices.
What technical solutions support data sovereignty?
Dutch cloud providers are increasingly offering sovereign solutions that comply with local laws and regulations. An example of this is the cooperation between seven Dutch IT companies in the Open Cloud Alliance, including Centric, KPN, Info Support, Intermax, Nebul, Previder and Uniserver, which collectively achieve revenues of about 2.5 billion euros per year.
These companies commit to the same technical standards, making it easier to exchange data between different vendors. Customers can therefore switch providers more easily without vendor lock-in. Moreover, the participants guarantee each other’s obligations to customers, which guarantees continuity.
Technical features of sovereign cloud solutions include prevention of forced access by foreign authorities, advanced security controls with data classification, accelerated achievement and enforcement of compliance, and data portability to avoid vendor dependency. They also offer backup and disaster recovery solutions for business continuity, all within Dutch borders.
How Pegamento helps with data sovereignty
We understand that data sovereignty is more than just technology: it’s about trust, control and the future of your organization. Through our collaboration with Dutch cloud partners like Uniserver, we can help you implement sovereign solutions without costly customization, but with a smart combination of proven modules.
Our approach to data sovereignty includes:
- Thorough analysis of your current data situation and compliance requirements
- Step-by-step migration to Dutch cloud infrastructure
- Integration of AI-driven intelligence running locally and meeting AVG requirements
- Continuous monitoring and reporting for compliance purposes
- 24/7 support from the Netherlands, with Dutch employees
As an ISO 27001-certified organization (in addition to ISO 9001 and ISO 26000), we guarantee the highest security standards. You get everything under one roof: no complex vendor management, just one point of contact for your total digital infrastructure. Today, we position RPA as “Agentic AI”: an evolution from executive bots to self-thinking assistants that not only follow instructions, but also take initiative independently within your secure, sovereign environment.
Want to know how data sovereignty can work concretely for your organization? Contact us for a no-obligation discussion about your options.
Frequently Asked Questions
How long does the transition to a sovereign cloud solution take?
The migration time depends on the complexity of your current IT infrastructure and the amount of data. An average transition takes 3-6 months, where we migrate incrementally to ensure business continuity. Critical systems are migrated first, followed by less essential applications.
What is the cost of data sovereignty compared to international cloud providers?
Although the initial cost may be slightly higher, you'll save in the long run due to lower compliance costs, avoided AVG fines and no currency risk. Dutch cloud solutions are often competitively priced, especially when you factor in the total cost of ownership (TCO) including legal and compliance aspects.
Can we continue to use our existing Microsoft 365 or Google Workspace?
Yes, but then you need to ensure that personal data stays within the EU and have adequate protections in place for data transfers. Many organizations are taking a hybrid approach: international tools for general productivity and Dutch solutions for sensitive corporate data and customer information.
How do I check if my current cloud provider complies with data sovereignty?
Ask your provider about the exact location of data centers, which jurisdiction applies, and whether they can provide guarantees against access by foreign authorities. Have your contracts checked for clauses on data localization and ask for certifications such as ISO 27001 or SOC 2 Type II.
What happens in the event of an outage or cyber incident at a Dutch cloud provider?
Dutch cloud providers offer the same high availability guarantees as international parties, often 99.9% uptime. In case of incidents, you have direct access to Dutch support in your own time zone. Moreover, they are governed by Dutch law, so you are better protected and can get redress more quickly in case of problems.
What about backup and disaster recovery with data sovereignty?
Dutch cloud providers offer full backup and disaster recovery solutions within the Netherlands or the EU. This means that your backup data also remains sovereign. Many providers have multiple data centers in the Netherlands for geographic spread, allowing you to combine both fast recovery and data sovereignty.
Which industries benefit most from data sovereignty?
Government agencies, healthcare organizations, financial service providers and companies in the defense industry have the greatest advantages due to strict compliance requirements. But SMBs that handle a lot of customer data or have competitively sensitive information also benefit from the added control and reduced risk of data breaches or legal issues.
