The CLOUD Act and AI Use: What You Need to Know as a European Company

The US CLOUD Act requires providers subject to U.S. jurisdiction to disclose data in their possession, custody, or under their control upon government or court order, even if the data is located outside the United States.¹ When using AI, therefore, in addition to the location where the data is processed, you should also verify which laws the operator and its subcontractors are subject to. A data center in the EU alone does not answer this question.

Multiple companies are often involved in the provision of language models. The section on options for action shows how you can address the associated risks. There, you will also learn about the possibilities and limitations of Myra AI Workspace. Read more about control over data and models in the article on sovereign AI.

The CLOUD Act (Clarifying Lawful Overseas Use of Data Act) is a US federal law that, among other things, regulates the disclosure of data regardless of its location. The US enacted it in March 2018.² A key provision is found in 18 USC § 2713: A provider of electronic communications or cloud services must secure, retain, or disclose content and data in its possession, custody, or control, regardless of whether it is stored within or outside the United States. The law states: “regardless of whether such communication, record, or other information is located within or outside of the United States.”¹

This obligation does not arise automatically. It requires a proceeding under the Stored Communications Act, such as a search warrant, a court order, or a subpoena.

The decisive factor is therefore control over the data, not merely the server’s location. The US Department of Justice’s April 2019 white paper explains which companies are subject to US jurisdiction. According to the white paper, jurisdiction is not limited to US companies, companies headquartered in the US, or US-owned companies. However, it is also not unlimited. For companies providing services in the US, the applicability of US jurisdiction depends heavily on the circumstances of the individual case. In the case of subsidiaries, it depends on whether the obligated company has sufficient control over the data stored there. The Department also emphasizes that the CLOUD Act did not expand the jurisdiction of US courts over companies.³

The options for challenging an order are limited. Under 18 USC § 2703(h), a statutory right to file a motion – allowing providers to challenge an order on the grounds of a conflict with foreign law – exists only with respect to countries that have a CLOUD Act agreement. Currently, the United Kingdom and Australia have such agreements, but the EU does not. This does not affect the application of general principles of comity in international law.⁴ Furthermore, a court may prohibit the provider from informing affected customers about the order.⁵

For AI use, this has two implications:

• Clarify jurisdiction: Ask the provider to explain whether and why it is subject to US jurisdiction.

• Clarify storage: Only data held by the provider can be disclosed. Therefore, verify whether and for how long prompts, responses, uploaded files, and logs are stored. Short-term or no storage reduces the scope of data that could be disclosed. It does not affect the issue of jurisdiction.

In addition to the CLOUD Act, FISA 702 is also relevant to the legal assessment of AI services. Section 702 of the Foreign Intelligence Surveillance Act (50 U.S.C. § 1881a until June 2026) is intended for foreign intelligence gathering. It permits the targeted collection of communications from non-US persons who are reasonably believed to be located outside the United States. An authorization is valid for up to one year. Companies that fall under the legal definition of “electronic communication service provider” may be required in writing to cooperate.⁸

The provision was temporary from the outset. Congress briefly extended its term twice in April 2026, most recently until June 12, 2026 (Pub. L. 119-87).⁹ Congress did not grant any further extension. Since then, Title VII of FISA, including Section 702, has been repealed.¹⁰

Previously issued orders remain in effect until their expiration under the transitional provisions of the FISA Amendments Act of 2008.¹¹ According to members of Congress, the FISA Court granted the current authorizations in March 2026.¹⁰,¹² Surveillance may continue on this basis until March 2027. If Congress renews the provision by March 17, 2027, there will be no gap.¹³ Congress is still negotiating a new provision (as of November 2, 2026).

The expiration of Section 702 does not end all surveillance authority:

• FISA Title I: According to the Congressional Research Service, electronic surveillance that previously took place under Section 702 is now governed by Title I of FISA. This provides for individual court orders.¹⁰

• Executive Order 12333: Foreign intelligence activities based on Executive Order 12333, which do not require the cooperation of service providers, remain unaffected.¹⁴

Therefore, document the legal framework on which you based your assessment.

FISA Section 702 is relevant to European data protection, in part due to the ECJ ruling of July 16, 2020. The Court declared the Privacy Shield invalid. Among the reasons cited was that programs based on Section 702 were not limited to what was strictly necessary (C-311/18, Schrems II).¹⁵

Myra Security GmbH is headquartered in Munich and has neither a US parent company nor a US subsidiary. As described above, the corporate structure alone does not answer the question of US jurisdiction. Business activities in the US and the subprocessors used are also decisive factors. Myra AI Workspace publicly lists its subprocessors in Section 5.1 of the Privacy Policy and in the Trust Center.²⁶

Myra AI Workspace’s application servers and databases run on Myra’s own virtualization cluster in a data center in Germany. Myra operates the hypervisor, storage, and databases itself.²⁶

The models operated by Myra are open-weight models that Myra operates itself within the EU. No external model provider is involved in the processing when these models are used. The original source of the model weights is not relevant in this context. What matters is who performs the processing.

Additional features may integrate other services:²⁶

• Web Search: If web search is enabled, the application sends the search query to Brave Search (Brave Software, Inc., USA) by default. For gateways with enforced EU residency, Myra uses Linkup (France) instead. The application sends weather queries to the free service wttr.in only if there is no enforced EU residency.

• Tool Connectors: These are disabled by default. Your administration decides whether to use them.

• Mobile Apps: Notifications are delivered via Apple and Google’s (USA) push services. They contain only the information necessary for display.

Conversations and uploaded files remain stored but are automatically deleted after a configurable period (default: 90 days), unless your organization has a different retention policy in place. Your organization may set shorter retention periods for query logs.²⁶

For external models, the legal situation must be assessed separately. If your administration approves a model from a US provider such as OpenAI or Anthropic, that provider’s legal jurisdiction also applies to these requests. Myra replaces recognized personal data with placeholders before transmission and restores it in the response. The purpose of this process is pseudonymization as defined in Article 4(5) of the GDPR. However, automatic detection does not capture every piece of personal information. Therefore, you must specify which content may be processed in projects using external models.

In projects with the “Local Only” access level, only models operated by Myra are available. The server rejects requests to external cloud models. The rules described above apply to additional features such as web search.

EU residency can be configured per gateway so that routes outside the EU are rejected even before the external service is called. This setting is disabled by default.

For further comparisons regarding the legal framework, see the articles “AI for DORA-Regulated Financial Institutions” and “AI in Hospitals: Protecting Patient Data”.

Schedule a demo to explore the settings of Myra AI Workspace using your own task as an example.

This article does not constitute legal advice. Your legal department or a law firm should assess whether and how the CLOUD Act or FISA 702 apply to your provider and your project. Legal status: November 2, 2026.