I am not sure, doing my business taxes in Germany (of course not the same as here), a lot of rules are applied in a way or another depending on the majority stake holder in the company. So, if the subsidiary is fully owned by a US company, this may still not be accepted.

This is why at some point (I am not sure if this is still the case), the Azure cloud in Germany was fully owned and operated by Deutsche Telekom. Microsoft was basically providing software, consulting and brand. This way, it was legally not possible for Microsoft to access the data.