Bangladesh is preparing to adopt its Personal Data Protection Act (PDPA), which would restrict cross-border transfers of personal data without government approval. The draft law proposes establishing a Data Protection Office (DPO) to oversee governance and enforce safeguards, requiring “adequate protection” in recipient countries. Sensitive data may be mandated to remain stored locally. Although not yet enacted, related regulations from the Bangladesh Telecommunication Regulatory Commission (BTRC) already impose limits on how foreign firms handle telecom and consumer data, reflecting a trend toward data localization.
This approach poses structural challenges for U.S. technology firms by forcing them to deploy costly local infrastructure or limit services, especially in a market that may not justify such investment. The localization mandate raises legal uncertainty, increases operational costs, and undermines scalability essential to digital service models.
More fundamentally, these policies rest on the flawed assumption that data security and sovereignty depend on storage location rather than on legal agreements, technical standards, and institutional capacity. U.S. firms already comply across jurisdictions via robust frameworks, and forced infrastructure fragmentation or unclear domestic access rules risk discouraging investment and damaging global competitiveness. As more emerging markets adopt such rigid localization, the U.S. risks losing influence over global data governance and its firms’ leadership in digital innovation.
