Once we fully entered the age of technology and the internet, and especially the latter the talk of the town became the data privacy and security. By now you probably have heard all the stories regarding various scandals that involve data breaches. Some of the most famous ones include the Facebook one and British Airways scandal. These are big companies and when issues regarding them arise people start paying attention. This is why not only companies but countries and governments are trying to put their stamp on the issue of data protection. While in the past some companies have been loose on the data of their clients and employees, authorities are now adamant to put an end to this. This is why today we are writing about the critical role of data sovereignty in contract management. If you like your data well stored and protected you are going to love this piece.

What Is Data Sovereignty?


This is the right place to start if you haven’t heard about it before. Data sovereignty is the concept that lies on the foundation and relies on the laws of the country to protect the data which were collected on its soil. The goal is to have the citizens protected from various data breaches, and that anyone who does it is responsible in front of the law of the given country on which territory a company conducted business and the data was collected. Today, most companies operate online and data is collected in massive quantities. In the past, most firms paid little to no attention to protecting these data as they weren’t subjugated to any law. Data sovereignty not only guarantees storage but also safety. In a case of a breach, they’re also held responsible by the country on which soil they operate.

This concept became inevitable once most of the data stopped being stored on paper and hard drives and instead moved onto the cloud platforms. The storing and processing of data were elevated on a whole new level, and the protection needed to be on the same one. Today we have customers requiring for their data sovereignty criteria to be met, and companies that do not comply will not be able to function much longer.

Data Sovereignty And Contract Management


Data privacy legislation is a must these days, and most of the contracts signed these days contain valuable data on the parties involved. This is why contracts and data sovereignty goes hand in hand. Today, contracts need to be in line with legislation, and thus their management after signing needs to be done properly. If the company you’re signing a contract with uses a cloud-based contract management system, there are a few things you need to have in mind.

CMS data can be stored anywhere, and you need to know the exact location. Some companies offer the locations where they store data, while others only have one location available. If you are not satisfied with the legislation on the given location regarding data preservation you should not sign anything. It all comes down to what they offer and whether it goes with what you’re willing to accept. In a case of a breach, which can happen, you want to know how the culprits who stole your data will be prosecuted. This is essential because as we already said, the legislation differs from country to country. CMS is not easy to comprehend to all of us, but things about can be learned. To learn more about contract management systems visit

Withing these services, there’s a chance, and it is most likely that your data will be transferred from place to place. It is also possible that for the services of OCR search companies are going to use partners and third parties. The situation is similar to the online document editing and electronic signatures. If any of these functions are involved the case is that your data will be moved between locations. If this is how things are you need to be aware of it because of the legislation on the premises where your data is stored and where it’s being moved.


The location of your data could mean everything to its safety and security. This is why you need to know about all the procedures that the company storing them is going to execute. Some of the things their engineering department is going to do may be going to change the location of your documents. You need to know if this is the case as it could affect the way your data is treated, which couldn’t be in line with what you approve.

Furthermore, you need to know what their plans in case of a disaster are. All businesses that conduct their work using other people’s data need to have a Disaster Recovery Plan. What this means is that all of the data they store needs to be backed up. You want to ensure that this is done while respecting the data sovereignty requirements. Despite we’re looking about backup data you still want it to be under the jurisdiction you agreed to.

The next thing you want to know and check out before signing anything is the companies data security credentials. Always look that they’re up to standards in this department. The gold standard at the moment is ISO 27001 certification.

Bottom Line


As we said, data security is one of the pillars of all online business and when it comes to signing contracts and allowing your data to be stored on clouds you need to make sure that data sovereignty is respected. At all moments you want to ensure that all of the information you allowed out in the ether upon signing a contract is dealt with under the laws of your chosen local or international legislation. We hope that this article showed you a glimpse of what you should know about this topic and that it gave you directions on how to proceed further in this department.