It is one of the most common misconceptions in enterprise AI procurement: the belief that choosing the 'EU region' of a US cloud provider keeps your data safe under European law. It does not, and the gap between those two ideas is where real risk lives.
The CLOUD Act, briefly
The US CLOUD Act allows US authorities to compel US-based providers to hand over data they control, regardless of where in the world that data is physically stored. A server in Frankfurt operated by a US company is still within reach.
This is not a hypothetical. It is the precise legal reason the EU's own court invalidated the Privacy Shield framework in the Schrems II ruling.
Sovereignty is about the legal entity
Real data sovereignty means three things are all European: the infrastructure, the operating company, and the legal jurisdiction that governs them. If any one of those is foreign, the chain breaks.
That is why 'hosted in Europe' is a marketing line, while sovereignty is an architecture. The question to ask any vendor is not 'where are the servers' but 'which country's courts can compel you to hand over my data'.
What good looks like
A genuinely sovereign deployment runs open-weight models on infrastructure operated by an EU company, under EU law, with no foreign parent that can be served an order. That is the standard Pryvan is built to, and the standard your DPO can actually defend.