So, from the article at least, the EU requires hard changes from MS regarding data storage. While the Germans are more complaining about the wording in the terms and conditions. Makes sense, I would have been surprised if my valued German administration had come to a different conclusion.
But honestly, this will be a) challenged by MS to defend their Office business in the EU and b) if that challenge doesn't work be solved by some other wording and / or changes to the data storage of Office 365 for EU based costumers.
Until then I have a hard believing all the companies, small to public international ones, will change back to non-cloud services anytime soon.