"Secondly, we could allow foreigner purchasers of Cloud services to 'opt in' to that regulation should they wish." The Australian government could also act to support local providers through acting as 'anchor clients', however, this should not mean Australian agencies should exclusively use local providers.

"Just as Swiss banks are attractive to global depositors, in substantial part because of supportive Swiss regulation, so the Australian government should regulate the Cloud so that we're a preferred provider for firms, governments and other users offshore," the report reads.

"Indeed Australian governments should be prepared to import Cloud services from any country that gives them similar confidence and that will mutually recognise our own offerings to them."

The report follows a year of major advancement in domestic Cloud services -- particularly those seeking to capture a share of the government sector.