US urges diplomats to push back on foreign data sovereignty rules

The Trump administration has instructed U.S. diplomats to lobby against other countries’ efforts to regulate how American technology companies manage and store foreigners’ data, arguing that data sovereignty measures could slow the development of AI services and related technologies, Reuters reported, citing an internal diplomatic cable.

The cable, signed by Secretary of State Marco Rubio, warns that these kinds of laws would “disrupt global data flows, increase costs and cybersecurity risks, limit AI and cloud services, and expand government control in ways that can undermine civil liberties and enable censorship,” according to the report.

In the cable, diplomats are directed to oppose what it describes as “unnecessarily burdensome regulations,” including data localisation requirements that force data to be stored or processed within a country’s borders. It also tells diplomats to monitor legislative and policy proposals that advance data sovereignty frameworks. In addition, the guidance urges diplomats to promote the Global Cross-Border Privacy Rules Forum. This international initiative claims to support “trusted data flows globally” through privacy and data protection certifications.

The directive comes as governments worldwide increase oversight of how Big Tech firms and AI companies collect, use, and move citizens’ data across borders. The European Union has been at the forefront of this regulatory push, including through frameworks such as the GDPR, the Digital Services Act, and the AI Act, which aim to limit how platforms exploit user data and to strengthen accountability for large technology companies.

The Trump administration has long opposed regulatory approaches like those, and the new instruction reinforces that stance as the U.S. government seeks to bolster domestic AI companies and their ability to operate internationally.