No, you are free to play the game on any server you wish, regardless of location. Be warned however, if you decide to join a server which is situated in a different region your network experience may vary.
For the best experience with Rust Console Edition, please join a server with the lowest ping as this will provide you with a smoother experience with reduced chances for network lag.
What is ping?
Ping is basically the amount of time it takes for you to receive information from our servers. The higher the number you see in the server list, the longer it will take for the server to send this information - which is why your game experience will be affected on servers with higher ping.