The National Security Agency's surveillance on electronic communications has spurred foreign governments to create new regulations to restrict US–based multinational technology companies’ ability to do business overseas.
Daren Orzechowski, a partner in the Intellectual Property Group at White & Case, said "there is a concern that countries will put up barriers like this," and said they would come at a price. "It's going to weaken the benefit of the technology and impact the ability of people to conduct global e-commerce and to collaborate internationally."
To eliminate counterintelligence risks, countries such as Germany, France and Canada have proposed initiatives that include data-residency requirements which will require foreign technology companies to build local data centers.
Detlev Gabel, a White & Case partner who advises clients on data privacy, said that German companies are stepping up their scrutiny of potential IT providers and are looking more to European vendors.