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CGEIT · Question #163

The CIO of an international enterprise is considering the use of an offshore cloud service provider to store customer data. Which of the following should be he MOST important consideration when…

The correct answer is B. Compliance with applicable legislation. When considering an offshore cloud service provider for customer data, the most critical factor is ensuring compliance with all applicable national and international legislation and regulations regarding data privacy and residency.

Submitted by skyler.x· Apr 18, 2026Governance of Enterprise IT

Question

The CIO of an international enterprise is considering the use of an offshore cloud service provider to store customer data. Which of the following should be he MOST important consideration when making this decision?

Options

  • AIT service delivery roles and responsibilities
  • BCompliance with applicable legislation
  • CLikelihood of natural disasters
  • DThe cloud service provider's reputation

How the community answered

(43 responses)
  • A
    9% (4)
  • B
    84% (36)
  • C
    5% (2)
  • D
    2% (1)

Why each option

When considering an offshore cloud service provider for customer data, the most critical factor is ensuring compliance with all applicable national and international legislation and regulations regarding data privacy and residency.

AIT service delivery roles and responsibilities

IT service delivery roles and responsibilities are important for operational efficiency but are secondary to legal compliance when dealing with sensitive offshore data.

BCompliance with applicable legislationCorrect

Storing customer data with an offshore cloud provider introduces complex legal and regulatory challenges, as different jurisdictions have varying data privacy laws, residency requirements, and sovereignty concerns. Ensuring compliance with all applicable legislation, such as GDPR or local data protection acts, is paramount to avoid significant legal penalties and reputational damage.

CLikelihood of natural disasters

The likelihood of natural disasters is a risk factor for business continuity, but legal compliance for data storage across borders is a more immediate and critical consideration.

DThe cloud service provider's reputation

A cloud service provider's reputation is an important due diligence factor, but it does not supersede the fundamental legal requirement for data compliance.

Concept tested: Data residency and regulatory compliance in cloud

Topics

#Legal compliance#Data privacy#Cloud computing#IT governance

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