The EU Data Act took effect in September 2025. It changes more than legal compliance. It alters the fundamental logic of SaaS valuations. Investors now face a new reality where user control of data trumps software control.
Data Portability as a Risk Factor
The law mandates that users possess the right to move their data between cloud services. Systems must support these transfers in machine-readable formats.
This requirement forces a change in due diligence. A target company may claim it supports data portability. The audit must now verify the technical reality. Does the system generate data in standard formats? Can the export process run without human intervention? A system that forces manual data extraction acts as a hidden liability.
The End of Artificial Retention
Many SaaS models rely on high switching costs. Customers remain because migrating data requires months of development work. The EU Data Act prohibits this practice.
Investors must distinguish between product quality and forced retention. If a target company keeps customers only because data migration is impossible, the business model lacks true strength. The Act mandates easy interoperability. If the platform cannot share data with a competitor’s service, it fails a core compliance test. Buyers should treat these technical limitations as valuation risks.
Contractual Vulnerabilities
Reviewing service agreements takes on new weight. Old contracts often contain clauses that block third-party access to user data. These terms conflict with the current law.
A thorough due diligence process now looks for these conflicts. Check if the target charges fees to move data. These fees often mask a strategy to prevent customer churn. If the contract prohibits data sharing with other platforms, it creates immediate exposure to regulatory fines.
The Technical Audit
Data room documents often hide operational weaknesses. The shift toward data portability requires a technical deep dive.
Test the API capabilities of the target software. Can it handle bulk data exports without breaking the primary service? Does the architecture prioritise data openness? A rigid system costs more to fix than a flexible one. Buyers pay for these remediation costs after the transaction.
Valuation Shifts
The EU Data Act forces a rethink of churn rates. A product with low churn might look attractive. If that low churn results from technical barriers rather than customer satisfaction, the value proposition changes.
The market has become more open. Future retention depends on the quality of the software, not the difficulty of the exit. Investors need to confirm that a target company thrives in an environment of choice. Look past the growth charts. Focus on the ability of the system to adapt. The most valuable companies now design for user freedom, not data capture.
The Amberg Team Perspective
At Amberg Team, our work bridges the gap between financial models and technical reality. We operate from Cambridge to support investors, family offices and corporate leadership across Europe.
Our team merges forensic analysis with years of hands-on operator experience. We push the software architecture to its limits. We test the API and the data export functions. This confirms whether the product meets the new legal standards.
Our clients need practical findings for high-stakes transactions. We provide the hard truth on execution gaps and value drivers that conventional methods often overlook. You make your decisions based on reality.