The Most Privacy-Respecting Jurisdictions (and the Least Exemplary)

Context: Data Privacy and Digital Sovereignty

Protecting privacy on the Internet has become a major global issue in the era of all things digital. Each country or region adopts its own laws and practices regarding the protection of personal data, creating significant disparities from one jurisdiction to another. From a business perspective, particularly for Quebec SMEs, these legal differences directly affect the choice of data hosting: where to store sensitive client and employee information to keep it secure and under control? This is where the concept of digital sovereignty comes in. This concept refers to the ability of a state (or entity) to control and protect the digital data of its citizens or clients, preventing it from being subjected to the laws or interference of a foreign power.

In practice, digital sovereignty often translates into the desire to keep data in trusted jurisdictions, with strict privacy laws, and to limit data transfers to less protective countries.

For example, Quebec recently strengthened its personal information protection law (Law 25) to regulate data transfers outside the province. This law requires that no personal data from Quebec be shared with a foreign jurisdiction without first ensuring that the latter offers a level of protection “equivalent” to that of Quebec. In other words, a Quebec business must think twice before hosting its data in a country with lax privacy laws.

So what are the best and worst places in the world for data privacy? To find out, we will review a Top 5 of the most privacy-respecting jurisdictions, followed by a Bottom 5 of the least protective jurisdictions. These rankings are based on recent empirical data (international rankings, current laws, comparative studies), all from a digital sovereignty perspective. The goal is to provide a clear and accessible overview, without technical jargon, to inform the decisions of professionals, particularly SME leaders in Quebec, on the best options for hosting sensitive data.

Before diving into the rankings, let’s recall that a “privacy-respecting” jurisdiction generally has several characteristics: comprehensive laws governing the collection and use of personal data, strong individual rights (right to information, explicit consent, right to be forgotten, etc.), an active data protection authority that can sanction abuses, and limits on mass government surveillance practices. Conversely, less virtuous jurisdictions in this area are distinguished either by the absence of protective laws, weak enforcement of such laws, and sometimes by intrusive state surveillance or a complete laissez-faire attitude toward companies exploiting data.

Illustration: world map showing “commitment to Internet privacy” scores by country, based on a study covering 110 countries. Countries in dark green (e.g., Norway, Australia, Denmark, Sweden, Finland) score highest, while those in red (e.g., China, Uzbekistan, Cambodia, Vietnam, Zimbabwe) rank at the bottom.

Top 5: Exemplary Jurisdictions for Privacy

The following five jurisdictions are among the most protective in the world for privacy and personal data. They have established robust legal frameworks, often internationally recognized, and demonstrate a political will to enforce confidentiality of personal information. It is no coincidence that most of them are in Europe, where data protection culture is highly developed. According to a comparative study, only five nations in the world recently had guarantees deemed “adequate” for privacy, and all of them were European. Here is an overview of the top performers:

1. The European Union (EU)

The European Union is not a country per se, but it is impossible to discuss privacy champions without mentioning the European framework. Since the General Data Protection Regulation (GDPR) came into force in 2018, the 27 EU member states apply harmonized legislation that is among the strictest in the world for data protection. The GDPR enshrines strong principles: explicit consent before data collection, transparency about data usage, rights of rectification and erasure (right to be forgotten), data minimization, and more. Above all, it provides for dissuasive sanctions in case of non-compliance, reaching up to 4% of the global annual turnover of an offending company.

The EU’s influence extends far beyond its borders. A distinctive feature of the GDPR is that it applies to the data of European citizens even if processing takes place abroad. In practice, a company based outside Europe (for example, in the United States) must comply with European requirements when processing the data of an EU resident. This has forced many international companies to adapt their practices, or even relocate the hosting of European customer data to Europe to avoid potential jurisdictional conflicts. Some small American businesses have even preferred to stop serving European customers rather than comply with the GDPR. This extraterritoriality of European law is an illustration of the EU’s digital sovereignty: it imposes its privacy standards as a global benchmark. Furthermore, the EU strictly evaluates the level of protection of third countries before allowing them to freely receive European data (via “adequacy” decisions). Only about a dozen non-EU countries have been deemed equivalent to the GDPR to date (e.g., Switzerland, Japan, Canada’s private sector, etc.), demonstrating European rigor.

In practice, several EU countries stand out for their particularly rigorous application of the GDPR. Ireland and France, for example, are among the strictest in a 2022 study, with guarantees rated as “adequate” for privacy. Ireland hosts the European headquarters of many major tech companies and has the heavy task of overseeing them, while France, through its CNIL, does not hesitate to impose heavy fines. Other countries like Denmark or Portugal also score very well in international comparisons. The key takeaway is that Europe, as a whole, offers the most protective environment for personal data. Any company seeking “safe” hosting from a privacy standpoint would make a wise choice by keeping data on European soil (or under European jurisdiction).

2. Iceland

Often cited as a model, Iceland combines the advantages of the European framework (although not an EU member, it has incorporated the GDPR into its national law) and a longstanding culture of protecting individual liberties. According to Freedom House, Iceland ranks first worldwide for Internet freedom, with a score of 94 to 95 out of 100 in recent years. This means that Icelanders enjoy nearly universal Internet access, an absence of censorship, and strong protections of their fundamental rights online.

Regarding personal data, Iceland enacted a very strict law as early as 2000, one of the first of its kind, to the point that some call it the “Switzerland of data.” This legislation requires that any data collection have a specific and legitimate purpose, and above all that it be done with the clear and informed consent of the person concerned. The approach is firmly opt-in: by default, no data can be used without prior agreement, a philosophy far more protective than the opt-out model (where data is collected unless the person objects). Iceland subsequently strengthened its arsenal by incorporating GDPR provisions in 2018 to remain aligned with European best practices.

This strict legal framework is accompanied by possible criminal sanctions: in Iceland, a data controller risks up to 3 years in prison for a serious privacy violation. These drastic measures show the priority given to confidentiality. As a result, Iceland enjoys a reputation as a haven for data. It even attempted at one point to position itself as a digital refuge for journalists and whistleblowers through the Icelandic Modern Media Initiative, capitalizing on its protective press and privacy laws. For an SME, hosting data in Iceland means benefiting from one of the most protective legal environments in the world, with guarantees comparable to the EU, if not superior in certain respects.

3. Norway

Norway, another Nordic country not a member of the EU, regularly ranks among the top performers in data protection. It has implemented robust laws aligned with the European GDPR, and has been officially recognized as providing an adequate level of protection by the EU (adequacy decision). According to a global Internet privacy index, Norway achieved the highest score in the world (90.1 out of 100), ranking 1st among 110 countries studied. Its commitment to privacy is also evident in its very high rate of secure server usage (widespread encryption of online exchanges) and in the active role of its data protection authority.

Several factors explain this performance. On one hand, Norway has had since 1978 an independent body, the Datatilsynet (Norwegian Data Protection Authority), tasked with enforcing rules and empowered to impose fines. On the other hand, Norwegian law requires that all processing of personal data requires explicit consent from the individual, who also has a right to be forgotten similar to the GDPR. Norway was even among the first to enforce this right against tech giants: it ordered Google to dereference certain content related to Norwegian citizens who wanted to disappear from search results.

Beyond protection against companies, Norway distinguishes itself through its firmness against foreign governments. It does not allow a foreign agency to spy on its citizens’ data at will: any access by a foreign authority must obtain the approval of a Norwegian court. This is a crucial point of digital sovereignty, and a notable difference from more permissive countries where international agreements or extraterritorial laws allow data sharing without local judicial oversight. In Norway, national judicial oversight prevails, ensuring citizens that their data will only be shared with a foreign state under exceptional and regulated circumstances. Finally, the country values technical security: it is among those with the highest number of secure servers per capita, a sign of an overall safe digital ecosystem. For a business, choosing hosting in Norway ensures top-tier protection, both legal and technical.

4. Japan

Japan represents a notable case outside the West: it is one of the few Asian countries to have adopted data privacy legislation comparable to European standards. Its main law, the Act on the Protection of Personal Information (PIPA/APPI), has been in effect since 2003 and has been revised several times to strengthen it, particularly after the European GDPR. In 2019, the EU officially recognized Japan’s adequacy, a mutual recognition that allows the free flow of data between Japan and Europe, based on equivalent guarantees. This means that European or Japanese citizens have their data protected similarly whether processed in Tokyo or Paris.

The Japanese framework requires companies to use data transparently and in a limited manner, with consent required for uses beyond the original purpose. Japan has innovated by extending certain obligations beyond its borders: any foreign company processing the data of Japanese citizens must comply with the principles of Japanese law. Moreover, Japan also protects the data of foreigners processed on its soil, not just that of its nationals, an openness that likely aims to facilitate international data exchanges while maintaining a high level of trust.

On the institutional level, Japan has a data protection authority (the Personal Information Protection Commission) that cooperates with its European counterparts. While Japan does not always appear in the “top” global rankings (it is sometimes penalized on criteria related to government surveillance or biometric use), it remains one of the most advanced countries in Asia for privacy. Its alliance with the EU on this topic makes it a favorable jurisdiction for data hosting, including for Western companies seeking a base in Asia without compromising on confidentiality. For Quebec SMEs with business connections to Asia, Japan can be seen as a trusted partner from a data protection standpoint, far ahead of other riskier Asian countries.

5. Switzerland

Switzerland is often perceived as a synonym for confidentiality, a reputation inherited from banking secrecy that extends to personal data protection. This small country, although not an EU member, has enshrined the right to privacy in its Constitution, and has had a robust Federal Data Protection Act (FADP) since the 1990s. Switzerland has regularly updated its legislation, including a recent overhaul (revised FADP effective in 2023) to stay in line with the European GDPR. The EU has deemed Switzerland “adequate”, authorizing free data flows with this neighboring country.

The Swiss regime shares many features with the European model: required consent, limited purposes, data security, rights of access and rectification for individuals, etc. However, there are some notable differences. Once a person has consented to data processing, their subsequent control options are somewhat more limited than in Europe: for example, rights to erasure or portability are slightly more restricted, with some falling under civil code rather than the data protection law itself. Similarly, the sanctions provided by Swiss law for privacy violations are lower than the massive GDPR fines. That said, the essentials are there: Switzerland prohibits the processing of personal data without consent, protects sensitive data (ethnic origin, health, opinions), and provides a path for recourse for affected individuals.

Switzerland complements this legal framework with an image of seriousness and neutrality. It hosts many secure data centers prized for storing ultra-sensitive data (some speak of “digital vaults” in former Alpine bunkers). This image is not just marketing hype: legally, storing data in Switzerland means that no foreign authority can access it without going through formal mutual legal assistance, and Switzerland is not party to any mass surveillance agreement like the Five Eyes. In short, Switzerland remains a preferred choice for those seeking sovereign and private hosting.

In summary, this Top 5 highlights jurisdictions with a comprehensive and modern legal framework, active institutions enforcing the rules, and a culture that prioritizes privacy over other considerations. To give a numerical sense of scale, note that on a global free Internet index, countries like Iceland, Estonia, Canada, and Germany also rank just behind this leading group, with high scores (between 80 and 95 out of 100) reflecting a digital environment respectful of rights. These examples show that beyond our Top 5, other democratic countries (Canada, Nordic countries, Central European nations, New Zealand, etc.) strive to protect their citizens’ privacy and deserve an honorable mention. However, a significant gap separates this leading group from the least virtuous countries we will now examine.

Bottom 5: Jurisdictions Lagging Behind on Privacy

After the top performers, let’s turn to the worst offenders in data protection. The following jurisdictions illustrate, each in their own way, serious deficiencies in respecting privacy. Whether they lack adequate laws, the authorities themselves abuse surveillance, or they leave citizens’ data unprotected against various appetites (commercial or governmental). It should be noted that we do not include certain extreme cases here like North Korea or Syria, where the very notion of privacy is nonexistent: these ultra-strict authoritarian regimes often have no data protection law whatsoever. According to the UN, approximately 66 countries in the world currently offer no legal protection for personal data. Among them are, for example, Afghanistan, Pakistan, Egypt, Saudi Arabia, and most Central African countries. Our Bottom 5 focuses on significant jurisdictions where, despite an appearance of modernity or existing laws, privacy remains seriously threatened or neglected.

1. Malaysia

Malaysia is an instructive example of a country that in theory has a data protection law, the Personal Data Protection Act (PDPA) in force since 2010, but in practice presents major gaps in guaranteeing citizens’ privacy. On paper, the Malaysian PDPA draws from the European model for data processed by local companies (consent, purpose limitation, security, etc.). However, it suffers from two major shortcomings. On one hand, the Malaysian government itself massively collects personal data from its citizens through a mandatory national identity card system that integrates biometric, medical, financial, and other information. Individuals have virtually no control over these government uses of their data. This massive centralized database contains all the elements needed for profiling, and it constitutes a prime target for malicious actors. Indeed, Malaysia has experienced massive data breaches in recent years: millions of records from hospital patients, telecom customers, and Malaysian airline passengers have been exposed due to security flaws. This underscores a lack of effective protective measures despite the law.

On the other hand, the enforcement of the Malaysian PDPA excludes data processing by the public sector (government), creating a significant gray area. Does the government share this identity data with other agencies? With what security? The lack of transparency fuels concern. In summary, Malaysia offers a false sense of protection: the law reassures international business partners on paper, but the average citizen remains exposed to potential intrusions into their privacy, whether by an overly curious state or through breaches due to insufficient cybersecurity. For a foreign company, hosting data in Malaysia could mean that in the event of access by local authorities, the affected individuals will have little recourse. This contradiction earns Malaysia its place among the lagging jurisdictions, despite its regional economic dynamism.

2. India

India, despite being the world’s largest democracy by population, long operated without a coherent framework for personal data protection. Until 2023, there was no unified federal law dedicated to data privacy in India. Instead, there was a patchwork of scattered provisions across various sectoral laws (banking regulations, telecom, health, information technology), insufficient to cover all modern uses of data. Moreover, no centralized specialized regulator was in place to monitor compliance or handle individual complaints. In other words, the responsibility of defending oneself in case of data abuse largely fell on the victims themselves through legal action, a difficult and costly path, and therefore rarely pursued.

This situation was all the more problematic given that India has developed in recent years a massive biometric identity system, Aadhaar, which assigns more than one billion people a unique number linked to their fingerprints and iris scans. Aadhaar is used for a wide range of services (banking, social benefits, tax filings, SIM card purchases, etc.), meaning the Indian government holds an unparalleled database of sensitive personal data on its population. Critics pointed to the risk of a Big Brother state, capable of tracking all citizen activities by cross-referencing Aadhaar data (payments, movements, etc.). Security flaws in Aadhaar have indeed been reported, exposing private information and sparking scandals about insufficient protections. The EU, for its part, assessed that India did not provide an adequate level of data protection, which in principle prohibits European companies from freely transferring personal data there.

Facing this criticism, India finally adopted in August 2023 its first comprehensive data protection law, the Digital Personal Data Protection Act. It partially fills the legal vacuum by defining basic principles (consent, limited use, access/correction rights, etc.) and creating a Data Protection Board. However, in the view of many experts, the law falls short of international standards: it contains broad government exemptions (in the name of “national security” or “public order”) and does not provide for a fully independent authority. Consequently, despite recent progress, India remains in this bottom 5, notably because of the massive aggregation of personal data under state control (Aadhaar) and a history of very weak protection. Companies that outsource to India (call centers, software development, etc.) must be aware: data sent there will not have the same level of confidentiality as in Canada or Europe, and the individuals concerned could see their information circulate without real safeguards.

3. Thailand

Thailand illustrates another facet of privacy challenges in Southeast Asia. The country adopted an ambitious law, the Personal Data Protection Act (PDPA), passed in 2019 and largely inspired by the European GDPR. On paper, this law should have placed Thailand in the camp of protective countries, with mandatory consent, sanctions, creation of a data protection commission, etc. However, its implementation has seen serious setbacks: the enforcement of the PDPA was postponed multiple times by government decree, officially to give companies more time to comply. In practice, this postponement (the law only became fully effective in mid-2022) reveals the limits of political will. A legal framework, however good, does not protect much if it can be suspended or delayed at will. This regulatory fragility tarnishes the credibility of the Thai system.

Moreover, the state of digital rights in Thailand remains concerning on other fronts. The country enforces some of the strictest online censorship in the region, notably with ultra-severe lese-majesty laws that heavily punish any criticism of the monarchy, including on the Internet. Thai authorities have a reputation for actively monitoring social media and citizens’ online communications. Many netizens and dissidents have been arrested or imprisoned for online speech, creating a climate of mass surveillance incompatible with true privacy. The government has also equipped its security services with monitoring and Internet traffic inspection technologies, reinforcing this large-scale surveillance.

In sum, Thailand is a paradoxical case: it has a fairly modern data protection law, but this progress is undermined by an authoritarian context regarding freedom of expression and surveillance. The balance clearly tips toward state control at the expense of privacy. For a business, hosting data in Thailand carries risks: not only could the data be inspected by the authorities (especially if it concerns sensitive topics), but also the absence of a strong protection culture (and the late implementation of the PDPA) raises doubts about data security. At present, Thailand remains in the category of unreliable jurisdictions for information confidentiality.

4. Russia

Russia often makes headlines regarding cybersecurity and surveillance, and for good reason: it is a state that has resolutely oriented its Internet toward a model of sovereign control. On the legislative front, Russia does have a Federal Law on Personal Data (since 2006) which, on certain points, grants basic rights to citizens (right to access data held by a company, right of rectification, etc.). However, in practice, these provisions are largely overshadowed by other laws and practices aimed primarily at monitoring and filtering the digital space. Russia has notably adopted very strict rules requiring companies operating on its territory to store the personal data of Russian citizens locally in Russia. Officially presented as a protective “digital sovereignty” measure, this requirement primarily aims to facilitate access by Russian intelligence services to this information. By keeping everything “at home,” Moscow ensures it can exercise easier control and censorship.

Russia has deployed an Internet surveillance system known as SORM, which requires Internet service providers and online services to install devices giving direct access to the FSB (intelligence services) for intercepting communications. Operators must retain traffic metadata for extended periods and hand it over to authorities on demand. Furthermore, since 2019, Russia has been working to establish a “sovereign Internet” (Runet law), meaning an infrastructure capable of operating in isolation from the rest of the world if needed, and enabling centralized traffic filtering. This project goes hand in hand with the regular blocking of websites and Western services deemed undesirable (social networks, opposition media, VPN tools, etc.).

Even in the realm of commercial data, Russia prioritizes control over privacy. For example, Russian laws provide virtually no recourse if data was collected legally: once a person has consented or their data has been collected in a legal context, they can no longer object to most reuses, except regarding commercial solicitation. Furthermore, Moscow has adopted laws requiring messaging platforms to provide means of decrypting encrypted communications, and social networks to delete content or hand over user data on demand.

With the current geopolitical context (Ukraine conflict, international sanctions), Russia has become even more digitally isolated. For Russian citizens, this translates into a decline in online freedom and certainly not an improvement in privacy. And for a foreign company, hosting data in Russia would be extremely risky: not only would it be difficult in practice (few reliable providers remaining, possible network shutdowns), but above all, data there would be at the mercy of authorities without real judicial constraint. Russia therefore clearly embodies a jurisdiction where the notion of privacy takes a back seat to the imperatives of state surveillance and information control.

5. China

No ranking of countries least respectful of privacy would be complete without China. This country of 1.4 billion people has deployed one of the most intrusive surveillance systems in the world, combining advanced technologies and the absence of democratic checks and balances. China consistently receives the lowest scores in Internet freedom indices: Freedom House has placed it last among 70 evaluated countries for years, and a privacy index ranked it 110th out of 110 with a score of 13 out of 100. This reflects the scale of surveillance and censorship. In China, not only is online expression strictly controlled (thanks to the Great Firewall that filters content and armies of human or algorithmic censors), but privacy is virtually disregarded in favor of state objectives.

The Chinese government has established a sprawling project to profile every citizen for security and social control purposes. The most striking illustration is the “social credit” system: based on various data (online behavior, judicial history, purchasing habits, social media activity, surveillance video…), the state intends to assign each person a citizen reliability score. Behavior deemed negative, such as criticizing the government on a blog, jaywalking caught by a smart camera, or associating with “poorly rated” individuals, can lower this score, resulting in sanctions like travel restrictions, slowed Internet access, or other limitations on rights. This system, with some versions already in place locally, clearly shows that the individual is completely transparent to the state, and that this transparency serves to guide and punish behavior.

Until recently, China had virtually no personal data protection law. Facing growing concerns (and perhaps for commercial reasons to reassure foreign partners), it recently adopted some legislation: China’s Cybersecurity Law in 2017, and most notably a Personal Information Protection Law (PIPL) effective since late 2021. The latter draws from the GDPR on certain points (consent, regulation of transfers outside China, access/remedy rights for individuals) and marks the recognition that consumer data should be protected from corporate abuse. However, these laws suffer from serious shortcomings. On one hand, they have no clear enforcement mechanisms against state-owned enterprises or public authorities: in practice, police and government agencies remain exempt from restrictions. On the other hand, certain principles remain vague or limited: for example, the law mandates minimum data retention periods but no maximum periods, which runs counter to the concept of minimization. Similarly, it does not strongly enshrine the right to erasure, and allows reuse of health data without consent in some cases. Above all, nothing in Chinese law truly limits the state’s surveillance powers. Security agencies can intercept, collect, and share data without any judicial oversight or warrant. The notion of correspondence secrecy or privacy from the state is nonexistent.

In short, China’s new laws provide some protections against corporations (for example, giants like Alibaba or Tencent have been sanctioned for poor data management), but change nothing for government surveillance. For Chinese citizens, posting a message, making a purchase, or even walking down the street under a camera means being potentially tracked. For a foreign company, China is a high-risk environment: any data stored on Chinese soil can be accessed by authorities through legal obligations, and regulations indeed require foreign companies to cooperate with security agencies when asked. This is why most privacy-conscious companies avoid locating their servers in China (unless legally required to operate locally). China remains the quintessential example of a digital power without counterparts in individual rights, where the state’s sovereignty over data is total, at the expense of privacy.

This Bottom 5 highlights varied contexts: democracy without law (India), legal frameworks flouted (Thailand, Malaysia), authoritarian states (Russia, China): all leading to a similar conclusion: in these jurisdictions, an individual cannot reasonably expect their personal information to remain confidential or used solely in their interest. The consequences range from uncontrolled commercial exploitation to political and social profiling. Moreover, broadening the perspective, several of these countries also rank among those where the Internet is least free and most surveilled in the world (China, Russia, Vietnam, Iran, etc.), as indicated annually by Freedom on the Net reports. For a foreign company or partner, processing data in these countries must therefore be done with extreme vigilance, or even avoided if protecting said data is a priority.

The North American Case: Where Do the United States and Canada Stand?

Our ranking of the best and worst has not yet discussed two major players: the United States and Canada. These neighbors and Western allies occupy a particular place in the privacy ecosystem, and it is worth examining where they stand and how this concerns Quebec businesses.

The United States, birthplace of Silicon Valley and the majority of tech giants, presents a paradox. On one side, it is a liberal democracy that upholds freedom of expression and where longstanding sectoral laws exist (for example, for medical data protection with HIPAA, or financial data with the Gramm-Leach-Bliley Act). On the other, the United States is one of the only major democracies lacking a single federal law on personal data protection. American regulation is fragmented into a multitude of partial laws and state-level regulations. This creates significant gaps: certain types of data or practices fall through the cracks of the legislative net, and the protection offered depends greatly on location and sector. For example, what is prohibited in California (which adopted the CCPA, a GDPR-inspired law) may be tolerated in another state without an equivalent law. The result is confusion for both consumers and businesses about their obligations.

In the absence of a general framework, it is often large corporations that define their own privacy policies, with a tendency toward self-regulation rather than constraint. Authorities like the FTC (Federal Trade Commission) intervene after the fact in cases of deceptive practices or serious failures, for example imposing record fines (Facebook was hit with a $5 billion fine in 2019 following the Cambridge Analytica scandal). But these actions, however impressive, remain sporadic and do not replace a true legal safety net.

Furthermore, the United States carries a mixed reputation regarding government surveillance since Edward Snowden’s 2013 revelations about the scope of NSA programs. Laws like the Patriot Act and more recently the CLOUD Act have fueled other countries’ fears about U.S. authorities accessing data. The 2018 CLOUD Act, in particular, allows American law enforcement (and even some partner countries) to directly request that cloud service providers hand over data, including if stored abroad, without going through the usual diplomatic treaties. This means that an American company hosting foreign nationals’ data can be ordered to turn it over to the FBI via a warrant, even if the data sits on a server in Europe or elsewhere. For the EU, this type of extraterritorial law is problematic and contributed to the successive invalidation of EU-US data transfer agreements (Safe Harbor and then Privacy Shield, struck down by the Court of Justice of the EU in 2015 and 2020). Currently, a new arrangement (Data Privacy Framework) attempts to reconcile the approaches, but legal uncertainties remain.

Consequently, the EU still considers that the United States does not offer an “adequate” level of protection by default: only contractual or specific solutions allow transatlantic data exchanges in compliance with the GDPR. In international rankings, the United States neither sits at the top nor the bottom, but rather in the middle of the pack. For example, Freedom House gave them a score of about 76/100 for digital freedom (less than Canada or Germany, better than the global average). Another study ranked them 7th from the bottom among 47 non-EU countries evaluated, highlighting the proliferation of biometrics, lack of federal guarantees, and the scope of unregulated CCTV surveillance systems. The absence of explicit constitutional protection of privacy (the 4th Amendment protects against unreasonable searches but does not apply the same way to online data) means that privacy in the United States rests on a patchwork that is less protective than in Canada or Europe.

In practical terms, for a Quebec SME, working with an American provider or hosting data in the US means understanding that this data may be more easily accessible (through targeted advertising, by the U.S. government in case of a legal request, etc.), and that regulation is less strict than here. This does not mean that all American services should be avoided: many offer serious contractual and technical guarantees, but one must be aware of the sovereignty stakes: in the event of a conflict of laws, an American company could be compelled to comply with its authorities’ demands, even if it means contravening Canadian or European privacy expectations.

Canada, for its part, has historically followed a middle path, often aligned with European principles but lagging behind in updating its laws. At the federal level, the main law for the private sector, PIPEDA (Personal Information Protection and Electronic Documents Act), dates back to 2000. It establishes basic principles on the fair collection and use of data, but it is no longer quite up to the big data era. Recognizing this, the Canadian government has prepared a major reform through the proposed Digital Charter Implementation Act (Bill C-27, currently under adoption). This reform includes a Consumer Privacy Protection Act that aims to be Canada’s equivalent of the GDPR, with clear consent, new obligations for businesses, and substantial fines for infractions. It also provides for the creation of a Data Protection Tribunal and strengthens the powers of the Privacy Commissioner of Canada. If this law is adopted and enforced, Canada will clearly join the group of “strong” privacy jurisdictions.

It should not be forgotten that Canada is federal and that provinces also have their say. Quebec has taken the lead with its Law 25 (formerly Bill 64), amending the provincial personal information protection law. This law, which came into force progressively between 2022 and 2024, drastically strengthens business obligations in Quebec, introducing explicit consent, new individual rights (portability, de-indexing), and GDPR-inspired fines. Most importantly, as mentioned in the introduction, it requires businesses to assess the protection offered by any country to which they send personal information, to ensure it offers a level comparable to Quebec’s. This is currently the highest standard in Canada for international transfers, and it will force many businesses to reconsider their hosting choices or cloud providers if those are located in weaker jurisdictions. In this sense, Quebec positions itself at the forefront of digital sovereignty in Canada.

From a global perspective, Canada is viewed positively: it was one of the first non-European countries recognized as adequate by the EU for data transfers (partial adequacy decision in 2001 for PIPEDA). Freedom House regularly ranks Canada in the top 5 countries for Internet freedom (score of 87/100 in 2020, which was 3rd globally). Canada is not without criticism, for example its membership in the Five Eyes intelligence alliance alongside the US, UK, Australia, and New Zealand, which involves it in intelligence exchanges that may concern intercepted personal data. But unlike the United States, Canada has a powerful privacy commissioner, comprehensive laws (private and public sectors), and a legal culture closer to Europe that positions privacy as a near-fundamental right.

For Quebec SMEs, this means that our local framework is solid and will continue to strengthen, and that our main trusted partners are found among Top 5 countries or equivalents (Europe, countries with European-style regimes, etc.). The United States remains an indispensable economic partner, but one whose privacy limitations must be understood, hence the importance of clear contractual agreements (standard clauses, etc.) when transferring data there.

Data Hosting and Digital Sovereignty: Advice for Businesses

What can businesses take away from this global panorama, particularly regarding sovereign data hosting? Several lessons emerge clearly:

• The location where your data is stored determines which laws apply to it. If your data is hosted in Quebec or in a Top 5 country (for example in France, Iceland, or Switzerland), it automatically benefits from a high level of legal protection. Conversely, data stored in a Bottom 5 country (in Russia or China, for example) risks being subjected to access or uses contrary to our principles without you being able to object.
• Digital sovereignty is primarily about maintaining control over who can access your data. By choosing local hosting or hosting in a country with strict laws, you ensure that no foreign entity can legally seize your data without going through robust legal processes (such as a request through Canadian or European courts). Conversely, entrusting your data to a provider based in a weaker jurisdiction can open breaches: for example, a US-based cloud provider could be compelled to hand over your data to American authorities under the CLOUD Act, even if you (or your clients) are not American.
• Recent legislative developments, particularly in Quebec, require businesses to address these questions. Quebec’s Law 25 now mandates assessing the protection level of foreign countries before sending personal information there. This formalizes a best practice: conducting due diligence on the host country for the data. Criteria to examine include the existence of a robust data protection law, the independence of the judicial system, precedents in privacy enforcement, and the absence of excessive surveillance.
• There are increasingly more sovereign hosting options available. Without naming specific providers, we can mention that many local or regional companies offer cloud or data center services where information remains hosted in the desired country (or legal space). For example, in Europe, “sovereign cloud” offerings are developing to compete with American giants, with assurance that data remains on European soil and under European jurisdiction. Similarly, in Quebec and Canada, certified cloud solutions for sensitive sectors are emerging, guaranteeing Canadian data localization and compliance with local standards. These options allow SMEs to choose a provider based not only on price or performance, but also on jurisdiction. This can become a commercial argument: your clients may be reassured to learn that their data stays in Canada or the EU, rather than being sent who knows where.
• Limit unnecessary transfers: digital sovereignty also means only sending your data abroad when truly necessary. Every global interconnection presents opportunities but also risks. For example, if your business uses foreign SaaS software, investigate: where does the vendor store your data? In the United States? In India? Does it offer a Canadian hosting option? Ask these questions, because otherwise you could unknowingly violate Law 25 or other obligations. In some cases, the most prudent solution is to not transfer sensitive data outside your territory at all if you can avoid it. As one analysis summarizes, “the safest strategy may simply be not to transfer personal information, or to limit it to what is strictly necessary.” By keeping data local, you reduce your exposure surface accordingly.
• Contracts and encryption: if a transfer or hosting in a less protective jurisdiction is unavoidable (for example, you have clients in China and must store data locally for them), then make sure to lock down technical and legal security: strong data encryption (so that in the event of unauthorized access, the data is unusable), clear contractual confidentiality clauses, and user notification so they consent with full knowledge. In other words, provide supplementary guarantees yourself where local law does not.

In conclusion, investing in privacy protection and digital sovereignty is not merely a regulatory constraint, it is also a mark of trust and quality for a business. In a world where consumers are increasingly concerned about the fate of their data (68% of Internet users say they are worried about not knowing how their information is used online), choosing to host data in a country with privacy-respecting legislation can become a competitive advantage. Conversely, a confidentiality breach due to careless hosting can seriously damage a company’s reputation and put it at odds with the law.

Digital sovereignty is precisely about making informed choices to maintain control over your information assets. For Quebec SMEs, this may mean favoring local or European partners for hosting, ensuring compliance with Canadian and European laws, and integrating the question of data jurisdiction from the design phase of their systems. The global privacy landscape we have outlined shows that there is a spectrum of more or less secure frameworks. Each must navigate according to their needs, but the overarching advice would be: keep your data within the confines of trusted jurisdictions whenever possible. It is the simplest way to sleep soundly and to guarantee your clients that their data is treated with all the respect they are entitled to expect. In short, choosing the right “digital territory” for your data is now just as important as choosing the right safe for your valuables: and the Top 5 jurisdictions unquestionably offer the strongest safes, while those in the Bottom 5 leave the door ajar, if not wide open.