Hi Simon,
the question is delicate; I know that in UK there is a number of universities 
using SMC for teaching purposes.
As well as in some other countries (William can give details on this, I 
suppose); as well, some MOOCs probably use SMC. And, finally, Andrew, the 
original poster, is in Sydney, Australia.

IMHO your university is unclear in its position; first of all, one has to 
define what "personal information" means. They might be right in saying that an 
official exam, and its records, cannot be held on 
overseas computer systems. How about GCE servers located in EU?
Is it legal? This way data does not leave the EU (probably, I don't know for 
sure).

In UK surely students can be asked to do coursework (we do not have any 
official continuous assessments, so I guess quizzes would be just fine, too) on 
SMC, nobody will blink at it. On the other hand, I cannot copy their academic 
records and other things like their home addresses, anywhere outside the 
University, and even so only under a number of conditions. 

Dima

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