Data Act: switching cloud providers free from January 2027

From 12 January 2027, cloud providers will no longer be allowed to charge a customer for switching provider: no switching charges, no data egress charges (EU · Data Act, Regulation (EU) 2023/2854, Article 29). Since 11 January 2024, those charges have had to be limited to the costs the provider incurs directly for that switch. Applicable since 12 September 2025, the Data Act also sets the pace of a departure: a notice period of two months at most, then thirty days of transition.

Free exit is the most visible measure, not the most decisive one. An organisation that has never tested its exit will not leave any faster because it no longer pays. The Data Act removes the exit toll, not technical dependency.

What is already settled

• Application (EU · Data Act): the regulation has applied since 12 September 2025 to all data processing services, whether infrastructure (IaaS), platform (PaaS) or software (SaaS).
• Charges (EU · Data Act, Article 29): limited since 11 January 2024 to the costs directly linked to the switch, abolished from 12 January 2027. Exception: when several clouds are used in parallel, data egress may still be charged at cost (Article 34).
• Timelines (EU · Data Act, Article 25): a notice period of two months at most, a thirty-day transition that the customer may extend once. The provider may impose a longer transition, of seven months at most, only if it justifies, within fourteen working days of the request, that thirty days is technically unfeasible.
• Technical requirements (EU · Data Act, Article 30): open interfaces and export in a commonly used, machine-readable format for PaaS and SaaS; “functional equivalence” for IaaS, meaning comparable outcomes with the new provider.
• Standard clauses (EU · European Commission): on 19 November 2025, the Commission recommended six non-binding standard contractual clauses for cloud contracts, notably on switching and exit, termination and liability.
• Connected products (EU · Data Act, Articles 3 and 50): products placed on the market after 12 September 2026 must be designed so that users can access their data by default, easily and free of charge, and directly where relevant and technically feasible.

What is still pending

• The digital omnibus (EU · Council of the EU): in its negotiating mandate of 21 October 2026, the Council would exempt custom-made services, and services provided by SMEs or small mid-caps, from most switching rules for contracts concluded on or before 12 September 2025. IaaS and the rule on charges stay outside those exemptions. The European Parliament has not adopted its position yet.
• Termination penalties (EU · Council of the EU): the same text would write “proportionate” early termination penalties in fixed-term contracts into Article 31, where today only a Data Act recital accepts them.
• The EU repository of interoperability standards (EU · European Commission, Article 35): it requires an implementing act; the Commission’s FAQ, updated in January 2026, still describes it as a next step.
• Merging the texts (EU · European Commission): the omnibus would fold the Data Governance Act and the Open Data Directive into the Data Act.

The real issue: exit is prepared before signature

Egress charges were the most visible barrier to switching providers. They were not the only one. The real locks lie elsewhere: managed databases, identity services, provider-specific AI tools, accumulated configurations, team skills.

The Data Act addresses them only in part. Functional equivalence applies to IaaS alone. For PaaS and SaaS, the provider must offer open interfaces and export the data, not reproduce how its application behaves. A SaaS customer gets its data back, not its tool.

The window is short: thirty days of transition by default, seven months at most if the provider justifies technical unfeasibility. That is enough to execute a plan, not to invent one. The contract must list exhaustively the data and digital assets that can be ported, and provide a data retrieval period of at least thirty days after the transition (Article 25). A contract that does not list what leaves with you will not help you leave.

Three points to watch

1. Multi-cloud still costs money. Free exit covers switching providers. If you run two clouds in parallel, data flows between them may still be charged at cost after 12 January 2027, according to the Commission (EU · European Commission).

2. Older and custom-made contracts. Article 31 already lightens obligations for custom-built services and test versions. The omnibus could extend exemptions, outside IaaS, to contracts concluded on or before 12 September 2025. Check the signature date of every contract.

3. Consumption commitments. Early termination penalties are not switching charges: the Data Act accepts them if proportionate (Recital 89) and only requires the customer to be informed before signature (Article 29). The Council position would write them into the operative text. Discounts granted for multi-year commitments can therefore be paid back on exit. Read those clauses before you commit.

What CIOs and buyers should do

1. Inventory cloud contracts: provider, model (IaaS, PaaS, SaaS), signature date before or after 12 September 2025, term, consumption commitments.
2. Check the switching clauses: notice period, transition, list of exportable data and assets, data retrieval period.
3. Require a breakdown of egress charges billed until 12 January 2027, then their written removal on that date.
4. Include the Commission’s standard clauses of 19 November 2025 in your next tenders.
5. Run a dry-run exit on a limited scope: export, re-import, actual duration, functions lost.
6. Map proprietary services (managed databases, identity, AI services) and decide which ones to accept knowingly.

The right to leave is only worth something if you know how to leave.

The question to ask on Monday morning

To your CIO: “If we had to leave our main cloud provider on 12 January 2027, how many days, and which functions, would it take us?”