SAP Launches UK Sovereign Cloud Amid Data Regulation Push

Enterprise software company SAP has launched a dedicated sovereign cloud service in the UK aimed at addressing growing requirements for data localisation in critical infrastructure and government sectors, where organisations must ensure sensitive information remains within national borders.

The concept of sovereign cloud has gained prominence as governments seek to protect national security interests and maintain control over critical data. Sovereign clouds ensure that data storage, processing and transmission occur within a country’s borders, preventing foreign jurisdictions from accessing sensitive information.

SAP, which serves 440,000 customers globally, is responding to increased regulation of data storage and processing, particularly for public sector and defence organisations. The initiative comes as UK government departments and regulated industries face stricter requirements for data residency and cybersecurity compliance following Brexit and evolving national security considerations.

The service, testament to SAP's investment in the UK after its initial €250 million (US$270m) commitment, establishes UK-based cloud computing infrastructure that ensures data remains within national borders and under local jurisdiction. The move comes as organisations face increased cybersecurity reporting requirements and data sovereignty regulation.

Public sector focus

The sovereign cloud service targets government departments, defence contractors and utilities providers who must comply with the UK Data Protection Act 2018 and security standards set by the National Cyber Security Centre. The infrastructure is operated by security-cleared personnel in dedicated UK facilities.

Martin Merz, President of Sovereign Services & Delivery at SAP, says: “At SAP, we are committed to protect the security and well-being of the societies we serve. With more than 20 years of experience in operating sovereign cloud solutions, today marks a significant milestone for us.”

The launch follows SAP’s creation of a specialised sovereign cloud unit in October 2024, which consolidates the company's expertise in operating cloud systems that meet national data sovereignty requirements. This unit serves as the foundation for SAP’s global sovereign cloud operations.

Technical capabilities

The initial service includes SAP's core enterprise resource planning software S/4HANA Private Cloud Edition, which manages business processes and financial data. The offering extends to SuccessFactors, the company’s human resources platform, and its Business Technology Platform – a suite of tools for developing and integrating business applications.

Additional services encompass SAP Analytics Cloud for data analysis, Fieldglass for workforce management, and Digital Supply Chain solutions including Integrated Business Planning. These applications run on infrastructure that maintains data residency within UK borders.

Regulatory compliance

The service focuses on sectors requiring heightened data security, including aerospace and defence companies, central government departments, the Ministry of Defence and energy providers. These organisations must adhere to specific data protection regulations and cybersecurity standards.

Leila Romane, Managing Director of SAP UK & Ireland, says: “In today’s complex global environment, it is vital for our customers to understand that their data, as well as our solutions and services, are secure. These are managed by security-cleared personnel in dedicated, local, secure facilities.”

The sovereign cloud infrastructure meets Cyber Essentials Plus standards, a UK government-backed certification scheme that protects organisations against cyber threats. This certification validates the security measures implemented within SAP's cloud environment.

Investment strategy

The launch represents part of SAP's broader investment in UK operations. The commitment supports the development of cloud infrastructure and facilities to serve the UK market.

SAP plans to expand its sovereign cloud capabilities with additional services, though specific details remain unannounced. The infrastructure supports the company's enterprise applications and business AI solutions, which organisations have used for over five decades.

Leila Romane says: “This launch also reinforces SAP's ongoing commitment to investing in the UK, as we continue to develop cutting-edge infrastructure, invest in facilities and talent, and create new opportunities that drive growth and digital transformation across the nation.”

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