http://www.zdnet.com/article/eu-to-u...tag=TRE17cfd61

The EU-niks, on the other hand, have decided to overreact, and in a big way. This week, the European Court of Justice overturned the long-standing US-EU Safe Harbor agreements. There's a ton of legal complexity and diplo-speak in what makes up the Safe Harbor deal, but it essentially allows American companies to store information belonging to Europeans on servers located in the United States.
What the European Court of Justice did this week is nuke that. They now claim that the Safe Harbor framework is invalid, which would -- and here's where it gets completely fuzzy -- seem to imply that American companies are not allowed to store European's data within the United States.


This is fuzzy because this is a diplomatic problem and if there is any one class of professional that makes a profession out of being unclear, unspecific, and non-committal, it's diplomats. For example, if you visit the U.S. Department of Commerce's Safe Harbor page, you'll see a very short statement acknowledging the ruling of "invalid" (Department of Commerce's quotes) and stating, "In the current rapidly changing environment, the Department of Commerce will continue to administer the Safe Harbor program."
So what happens to an Australian organisation storing data on a US based server and some of that data belongs to a EU based person? meh!

This is a general problem of the 'net. Especially for Cloud Services which include Flickr, Amazon, M$, Adobe etc.
Who knows where your stuff is being stored?

So the EU are getting heavy handed, but I reckon it will blow up in their face.