The Data Act is the final piece of the European data regulatory puzzle. Adopted in 2023 and enforceable from 2025, it aims to facilitate data sharing and portability, particularly in the cloud. What are the implications for your hosting provider choice?
The Data Act in Brief
The Data Act is a European regulation that complements the GDPR and the Data Governance Act. Its objectives:
- Facilitate access to data generated by connected products (IoT)
- Balance value sharing around industrial data
- Make it easier to switch cloud service providers
- Protect against unlawful data transfers to third countries
This article focuses on the cloud-related aspects.
What Changes for the Cloud
Enhanced Portability Rights
The Data Act requires cloud service providers to facilitate data portability. In practice:
- Data export in standard, documented, machine-readable formats
- Interoperability: providers must enable migration to other services
- Reasonable timeframes for data export
No more proprietary formats that lock customers in. Hyperscalers will have to make it easier to leave their platforms.
Elimination of Egress Fees
The egress fees charged by AWS, Azure, and GCP are often prohibitive. The Data Act provides for their gradual elimination:
- From 2027, egress fees related to provider switching will be banned
- A transition period with progressive fee reduction is planned
This is excellent news for businesses that were hesitant to leave hyperscalers due to migration costs.
More Balanced Contracts
The Data Act imposes minimum requirements in cloud contracts:
- Clear information on termination conditions
- Reasonable notice for changes to terms and conditions
- Assistance with migration to another provider
Protection Against Unlawful Transfers
The Data Act strengthens protection against data access requests from third-country authorities (such as requests based on the US Cloud Act).
Cloud providers will need to:
- Take reasonable measures to protect data against unlawful access
- Notify clients of access requests (when legally possible)
- Refuse requests that conflict with European law
Important Limitation
The Data Act cannot prevent the US Cloud Act from applying to American companies. However, it requires these companies to resist requests and inform their clients. The best protection remains choosing a hosting provider not subject to these laws.
An Opportunity for European Clouds
The Data Act levels the playing field between hyperscalers and smaller European providers.
End of Lock-in
The lock-in practices that favored cloud giants (proprietary formats, high egress fees, exclusive integrations) are now regulated. Businesses can more easily:
- Test European alternatives
- Migrate if the alternative is better
- Distribute their data across multiple providers
Strengthened Sovereignty Argument
With its provisions on unlawful transfers, the Data Act reinforces the data sovereignty argument. Businesses are encouraged to assess the legal risks of their hosting choices.
A Swiss hosting provider like Infomaniak, not subject to the Cloud Act and benefiting from GDPR adequacy, becomes even more attractive in this context.
What the Data Act Is Not
To avoid misunderstandings, let\'s clarify what the Data Act does not do:
- It is not a replacement for the GDPR – Both coexist; the Data Act does not address personal data in the same way
- It is not a ban on American cloud services – Businesses remain free to choose, but must be informed of the risks
- It is not immediate – Some provisions take effect gradually through 2027
Practical Implications
For Cloud-Using Businesses
- Assess your dependency on your current provider
- Test portability: can you easily export your data?
- Compare alternatives now that migration will be easier
- Negotiate your contracts leveraging Data Act provisions
For Cloud Providers
- Update your export tools to comply with standard formats
- Document your APIs and data formats
- Review your egress fee policy
- Communicate your compliance to reassure your clients
Infomaniak and the Data Act
Infomaniak is naturally aligned with the spirit of the Data Act:
- Open formats: kDrive stores standard files that are easily exportable
- Standard protocols: IMAP, CalDAV, CardDAV for email and calendars
- No egress fees: Infomaniak has never charged abusive egress fees
- Swiss hosting: Maximum protection against unlawful transfers
The Data Act doesn\'t fundamentally change things for Infomaniak, which already practiced openness and portability. But it strengthens its position against hyperscalers who will need to adapt.
Timeline
- 2023: Regulation adopted
- September 2025: General enforcement begins
- 2027: Full elimination of cloud egress fees
Conclusion
The Data Act is good news for competition in the European cloud market. By facilitating portability and regulating lock-in practices, it gives businesses more freedom in their hosting choices.
Now is the time to evaluate your options. If you\'re with a hyperscaler and were considering a European alternative, the barriers to migration are coming down. Providers like Infomaniak can now compete more fairly with the American giants.
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