Will there be different T&C's for the eurpean servers? The current T&C's still specify that the servers are under US law ...

Those interested in cloud infrastructure should also take a look at the other two European clouds: ElasticHosts (ourselves, www.elastichosts.com) and FlexiScale. Compared to Amazon, ElasticHosts offers several advantages, including lower prices when bought by subscription, more flexible choice of server sizings, ability to install your own operating system from scratch and operation fully under UK law (see last comment).