The difference is that connecting to an VPS outside of UK legislation is a process which encompasses pretty much everything, from email to webbrowsing to whatever. The traffic is HTTPS encrypted and looks like any other legitimate traffic. What the VPS does afterwards is invisible to the UK Government. If the UK doesn't want to put up a great Firewall that makes China blush, there is no way to prevent this, and legislation that cannot be enforced is dead law.

Also, this would be very disruptive for any business that isn't totally local, which is an pretty good incentive to not do this if they dont want to cripple their economy.

Judging by the way law enforcement against foreign sites sharing copyrighted materials has happened, it's either cooperating with the local authorities for taking down the servers or taking away the domain names - which for this law, which unlike copyright isn't an internationally agreed thing and for which there are zero international protocols in place, seems unlikely to get the required local authorities cooperation in most other countries - or by forcing local (in this case UK) ISPs to block access to the domains and/or IP addresses of the foreign servers breaking the law - which given how the larger VPN providers operate (basically, they have lots of VPN access points and often add more - for example Mullvad in 2025 had 667) will already be a game of wack-a-mole even without going after people setting up their own VPN in a VPS, and way more so if they do go after those since there are hundreds of thousands, maybe even millions of VPSs for rent out there because there are lots of VPS providers and each can spin up a very large number of virtual private servers, plus there are a lot of uses of VPSs in the UK which are perfectly legal so blocking the IP addresses of those can have a massive business impact and impact in the perceived reliability of the Internet in the UK for all manner of things.