Microsoft Briefly Turned Off Indian Companys Cloud, Perhaps Due To EU Sanctions On Russia

Microsoft disconnected Indian company Nayara Energy from its cloudy resources last week, before restoring access ahead of a court clash.

This story starts on July 18th when the European Union approved a fresh set of sanctions aimed at making it harder for Russia to continue its war against Ukraine. Deep in the fine print of the sanctions order is a mention of an oil refinery operated by Nayara Energy in the Indian city of Vadinar, which the EU says is 49 percent owned by the Russian State oil company Rosneft.

“Nayara Energy is involved in an economic sector providing a substantial source of revenue to the Government of the Russian Federation,” the document states. That activity means Nayara is subject to EU sanctions.

Nayara Energy protested the sanctions in a strongly-worded statement that asserts “This unilateral move by the European Union is founded on baseless assertions, representing an undue extension of authority that ignores both international law and the sovereignty of India.”

At some point after the EU announced its sanctions, Microsoft denied service to Nayara Energy – reportedly removing access to hosted Teams and Outlook data.

That action saw Nayara seek a court order to have Microsoft restore service. In a court filing [PDF] complained of “unilateral decision taken by the respondent [Microsoft], whereby they have stopped providing the services to the petitioner [Naraya].”

Nayara Energy called for the court to direct the software giant “to continue to provide the services under the Microsoft Business and Service Agreement (MBSA).”

Two days later, a second filing [PDF] states that Microsoft restored services.

Reuters last week reported that Nayara Energy signed with Indian company Rediff, which provides business-grade hosted email services.

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Local media have pointed out that this incident neatly illustrates the risk of using technology providers who are beholden to the laws of other jurisdictions.

Ironically, businesses and governments across European Union worry about the same risks, leading hyperscalers like AWS, Microsoft, and Google to take steps to ensure their European operations are out of reach of American laws. Such moves haven’t satisfied some European buyers, as France-based cloud OVH recently leaked news of talks with the EU over creation of a sovereign cloud.

All of which leaves us in the odd situation of an EU attempt to defend Ukraine’s sovereignty being seen to threaten India’s, and also boosting demand for sovereign cloud.

What a time to be alive. ®