Why enterprises pay for governance: the org answers for how its people use AI

Data sovereignty (Schrems II / US CLOUD Act)

Even under a vendor's "zero data retention" contractual promise, plaintext still physically transits to the vendor's infrastructure — frequently US-based, reachable under the US CLOUD Act. That's a data-sovereignty exposure independent of training-data risk, and the reason pre-emptive masking (replacing identifiers before the request leaves the machine) is worth more than a contractual promise.