Data sovereignty refers to the concept that data is subject to the laws and regulations of the country in which it is collected or stored. This means that organizations must comply with local laws regarding data privacy, security, and access, which can vary significantly from one country to another. As businesses increasingly rely on cloud services and global data storage, understanding data sovereignty becomes crucial. For instance, the European Union's General Data Protection Regulation (GDPR) imposes strict rules on how personal data is handled, affecting companies operating within or dealing with data from EU citizens.