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Data residency

Data residency refers to the geographic location where data is physically stored and processed. For many organisations it is a significant requirement because the jurisdiction where data resides determines which laws apply to its processing and which authority may access it. Choosing to keep data within a given territory, for example within the European Union, helps comply with data protection rules and reassures customers and partners about the handling of sensitive information.

Definition

In the AI context, the issue arises when using cloud services whose servers may be located in different countries: sending data to a model hosted abroad can entail international transfers subject to specific safeguards. For this reason many companies prefer providers with local data centres or on-premises solutions, so as to retain control and compliance over where information is located.

Related terms

• Data minimization
• DPA (data processing agreement)
• Ollama (local models)
• Conformity assessment
• Transparency obligations

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