> The EU part cannot be owned by the US entity since the US government can compel the US mother company to have it's subsidiary hand over data.

As it stands, the US part can be owned by a EU company. Or, probably more realistically, both EU and US parts could be owned by a mail box in the Caimans.

> The EU part cannot be owned by the US entity since the US government can compel the US mother company to have it's subsidiary hand over data.

Is this true for ownership by individuals too?

If I, an American citizen & resident, owned and operated a company registered to a European nation to serve my European customers (with European hosting), does that make me compliant? Does an American solo founder have a path to compliance at all, or would I be required to collaborate with a completely separate workforce that has no ties to America?

If you are subject to the cloud act in the US then you are not compliant or in anyway can be compelled by the US to hand over data on EU citizens.

As a private individual I suspect you would not have much to stand on if the NSA knocked on your door.

Another way to be compliant is to not collect PII.

> Another way to be compliant is to not collect PII.

The GDPR extends far beyond the US notion of PII. As I understand it, it covers basically all user-submitted or user-related data if it's possible for that data to be hypothetically tied to an individual in the EU (even if that can be done without your service holding traditional PII).

> As a private individual I suspect you would not have much to stand on if the NSA knocked on your door.

Yeah, a federal agent with a wrench can do anything they want to me (https://xkcd.com/538/), but I'm trying to figure out my options.

> The GDPR extends far beyond the US notion of PII.

That's a good thing. The US notion of PII is ridiculously naive.

It includes IP address... the fundamental glue that makes routing to and from said servers possible. Good luck being able to resolve web requests without knowing where to send the response.

IP address is both personally-identifying information and also technically required to provide computational service.

Just like your name is personally-identifying information and (usually) required to provide medical service.

But being required for service doesn't automatically mean that it can be shared with third parties. You can't share names with third parties. Why would you share IP addresses?

A name is not a requirement to render medical service, so I don't see how that example is relevant. A practioner is capable of treating patients without knowing their name. Laws may compel them to keep track of that data, but it's not strictly necessary.

And the act of connecting to a server hosted in another jurisdiction (e.g. America) would require sharing your IP. This could be directly (the entire web service hosted in the USA), or indirectly (some of the web service's assets are hosted in the USA).

If you put a CDN in-front of your web service, then that CDN will most likely be sharing your IP with the host server too. Especially if the web service wants to do something non-cacheable that they can't offer from behind the CDN.

There are many (!) types of medical treatments. Some require multiple visits. A medical practitioner needs some way to ensure that progress is maintained across multiple visits.

The internet has multiple visits too. They're just called packets instead.

MS did the same in Germany with Deutsche Telekom as a partner, that shut down around 2018 [1].

[1]: https://nextcloud.com/blog/microsoft-and-telekom-no-longer-o...

They still do in China: https://docs.microsoft.com/en-us/office365/servicedescriptio...

Hmm, that's interesting. I suppose more cloud providers could do something like that, for the benefit of customers and GDPR?

E.g. Amazon already bills me through some Norwegian entity of some kind, to get VAT done right etc.

If they had servers in Norway, I suppose it would have been possible to proxy everything - not just billing - in AWS Norway through this sub operator?

To fall out of scope of the CLOUD act, the subsidiary needs to be independent and prevent any data access by its holding company. The holding company can in no way have "possession, custody or control", which are not well defined so that doesn't make it easier to assess if a subsidiary is out of scope.

https://jnslp.com/wp-content/uploads/2020/05/Defining-the-Sc...

So is it likely the European Commission did this in an attempt to block US companies from offering internet services to the EU (or at least, internet services that handle user info)? It's pretty hard to make a profit or operate in the EU if you literally can't control that entity.

Schrems II (and the Privacy Shield invalidation) has been in response to the aggressive data collection by the US government, and the extra-territorial nature of legislation used to achieve this. The US is able regain access to the EU market by repealing/changing CLOUD act and similar legislation, so I personally don't think this is (primarily) done to block US companies. However I am not the one implementing these rulings, so the best I can is speculate.

It seems pretty hard to think the US will drop the legislation every 3-letter-agency had wished for over the decades before it became law. The only thing I can imagine that actually gets the law changed is if the EU heavily invests in prosecuting these cases, to the point that tons of US companies worry they'll lose access to the EU market (with non-negligible fines to back up the law).

> So is it likely the European Commission did this in an attempt to block US companies from offering internet services to the EU

More like the European Commission did this in an attempt to protect European citizens from having their personal data exfiltrated against their will to the US on order of US law enforcement agencies.

No, EU had an agreement with the US called Privacy shield that allowed US companies to process EU data. However this was struck down by US courts and that is what leaves us with this mess.

> However this was struck down by US courts and that is what leaves us with this mess.

According to Wikipedia, it was struck down by the CJEU, not by a US court:

"The EU-US Privacy Shield for data sharing was struck down by the European Court of Justice on the grounds it did not provide adequate protections to EU citizens on government snooping."

https://en.wikipedia.org/wiki/EU%E2%80%93US_Privacy_Shield#L...

If anything, it was a move to push US legislators to respect foreign privacy laws.