Have you recently viewed the Copilot settings in M365 Admin Center – Copilot – Settings – View All?

Now you will find a setting here that is called “Flexible inferencing during peak load periods”. When it comes to this setting, it is important that you carefully consider and decide how flexibly you want your data to move.

Allowing flex routing outside the EU during peak demand is like diverting traffic onto a temporary bypass when the main road is congested. It can keep everything moving smoothly, but you should understand exactly where that detour goes and what travels on it.
Even though data is always encrypted and primary data remains within the EU, this setting allows limited pseudonymized data to be processed or stored outside the EU Data Boundary. That makes it important to perform a deliberate security and privacy assessment. Organizations should weigh the benefit of a consistent Copilot experience against regulatory requirements, data residency expectations, and internal risk tolerance.
Reviewing this setting is not just a technical checkbox—it is a conscious decision about how much flexibility you allow when demand is high.

If you do NOT want to allow large language model (LLM) inferencing to occur outside the European Union (EU) Data Boundary during periods of peak demand to help maintain a consistent ‎Copilot‎ experience, You should set this setting to “Do not allow flex routing”.