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What I don't understand is why they have not auto migrated all customer data to the closest region. Why ask the customers to do this migration instead of transparently handling it for them? yes the cost may be different but this was their decision, they should absorb these costs until the customers decide.

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Auto migrating data to the closest region cannot be done without legal implications if that region is another country.

99% of cases there are no legal implication of moving data in another country inside EU. Amsterdam is the closest in Geographic and Political sense. These are cloud data. already subject to EU Policy and not country specific. Those that really have the country condition can not even use a cloud provider but need to rent/collocate servers (not services) in the country.

Last time I checked, Sydney is not in the EU.

Sydney is not but this thread (at least the title) was for europe-west1 in Belgium which is in EU.

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