Cloud vendors will not guarantee your data will only reside in the US. Read the fine print, they will not even guarantee its security.
They leave themselves so many loop holes in their contracts that you will not be able to hold them accountable when things go wrong.
Take a look at the recent Mid Atlantic states derecho that crippled Amazons cloud services for much of the nation. Something their cloud services advertising says should not have happened.
Yet it did go down and their service provider contracts were well written to prevent them from being punished by the firms that were impacted by the extended outage.
http://gcn.com/articles/2012/07/02/amazon-cloud-outage-summer-storm.aspxhttp://voip.biz-news.com/news/2012/07/01/0001 
