Deduplication in a network storage environment includes, for files stored in a network, determining a location constraint status specified by a compliance agreement for each of the files. Location constraint statuses include a location of persistent residency and no residency restriction. Deduplication also includes selecting a file from the files in the network and identifying corresponding redundant files, the selected file and the corresponding redundant files representing a set. Deduplication further includes determining the location constraint status for each of the files in the set. For the files in the set having a location constraint status specifying a location of persistent residency, the deduplication includes retaining a master copy at the respective location of persistent residency, and removing the corresponding redundant files from the network.