The idea of a data haven like Sealand is interesting because it challenges the ability of not just one state but states comprising the international community to control or regulate internet activities being done or originating in Sealand and for private individuals and entities to seek redress for actions done in Sealand. Since Sealand is its own sovereignty and has the power to create and enforce its own laws (in most cases, there is little or no regulation in these havens), theoretically, it is the perfect place to set up shop in order to escape and be free from the laws, regulations and control of other states. This freedom from regulation and liability under other national laws can equally be used by copyright infringers, online gambling sites, child pornographers and political despots and by freedom of speech advocates, political activists and international organizations targeting repressive regimes.
However, despite its sovereignty, the government of Sealand and people who use Sealand as a data haven cannot completely escape from having to deal with the laws of other states and jurisdictions. This is due in part to the fact of the complexity of modern international relations between and among states that require “co-ordination and co-operation for common purposes.” No country or jurisdiction – not even Sealand – has absolute sovereignty. In order to have internet access, Sealand has to physically connect to the internet somewhere (in this case, London and Amsterdam). In order to receive and process payments from outside, Sealand has to establish a banking and financial system that works with international banking systems and standards. If there are any unlawful acts that are being done in Sealand, for example, the PirateBay sets up shop there or criminal organizations use Sealand as a haven to launder money, other states and the international community can put a stop to these activities by simply refusing to interact with Sealand (e.g., physically severing the internet connection to Sealand or prohibiting any transaction by their nationals with persons and entities based in Sealand). While embargoes are in no way fool-proof (see the cases of state actions cutting off state relations and trade to Cuba, Iran, Sudan, etc.), they are still very effective in limiting the power and influence of these places. Even well-known tax havens like the Cayman Island and the British Virgin Island are subjected to limits to their sovereignty and have to comply with certain international obligations (e.g., banking and tax rules) to be able to take part in the international community of nations.
In a sense, Sealand is a real world case study of cyberspace. While at first glance cyberspace appears to be beyond the control of states and promises absolute freedom to its users (like Sealand), in truth, there is no absolute sovereignty in cyberspace because: (a) the computers and systems on which the internet runs on are physically located in the real world; and (b) people who use the internet are physically present and their actions have effects or affect other persons in the real world. There is no avoiding the fact that, the internet and its users are inherently connected to the real world of territorial sovereigns and boundaries. The idea of cyberspace as a borderless world free from any national laws is pure fantasy and quickly vanishes in the uncompromising light of reality.