When Google and Amazon negotiated a major $1.2bn cloud-computing deal in 2021, their customer – the Israeli government – had an unusual demand: agree to use a secret code as part of an arrangement that would become known as the “winking mechanism”.
The demand, which would require Google and Amazon to effectively sidestep legal obligations in countries around the world, was born out of Israel’s concerns that data it moves into the global corporations’ cloud platforms could end up in the hands of foreign law enforcement authorities.
Like other big tech companies, Google and Amazon’s cloud businesses routinely comply with requests from police, prosecutors and security services to hand over customer data to assist investigations.
This process is often cloaked in secrecy. The companies are frequently gagged from alerting the affected customer their information has been turned over. This is either because the law enforcement agency has the power to demand this or a court has ordered them to stay silent.
For Israel, losing control of its data to authorities overseas was a significant concern. So to deal with the threat, officials created a secret warning system: the companies must send signals hidden in payments to the Israeli government, tipping it off when it has disclosed Israeli data to foreign courts or investigators.
To clinch the lucrative contract, Google and Amazon agreed to the so-called winking mechanism, according to leaked documents seen by the Guardian, as part of a joint investigation with Israeli-Palestinian publication +972 Magazine and Hebrew-language outlet Local Call.
Based on the documents and descriptions of the contract by Israeli officials, the investigation reveals how the companies bowed to a series of stringent and unorthodox “controls” contained within the 2021 deal, known as Project Nimbus. Both Google and Amazon’s cloud businesses have denied evading any legal obligations.
The strict controls include measures that prohibit the US companies from restricting how an array of Israeli government agencies, security services and military units use their cloud services. According to the deal’s terms, the companies cannot suspend or withdraw Israel’s access to its technology, even if it’s found to have violated their terms of service.
Israeli officials inserted the controls to counter a series of anticipated threats. They feared Google or Amazon might bow to employee or shareholder pressure and withdraw Israel’s access to its products and services if linked to human rights abuses in the occupied Palestinian territories.
They were also concerned the companies could be vulnerable to overseas legal action, particularly in cases relating to the use of the technology in the military occupation of the West Bank and Gaza.
The terms of the Nimbus deal would appear to prohibit Google and Amazon from the kind of unilateral action taken by Microsoft last month, when it disabled the Israeli military’s access to technology used to operate an indiscriminate surveillance system monitoring Palestinian phone calls.
Microsoft, which provides a range of cloud services to Israel’s military and public sector, bid for the Nimbus contract but was beaten by its rivals. According to sources familiar with negotiations, Microsoft’s bid suffered as it refused to accept some of Israel’s demands.
As with Microsoft, Google and Amazon’s cloud businesses have faced scrutiny in recent years over the role of their technology – and the Nimbus contract in particular – in Israel’s two-year war on Gaza.
During its offensive in the territory, where a UN commission of inquiry concluded that Israel has committed genocide, the Israeli military has relied heavily on cloud providers to store and analyse large volumes of data and intelligence information.
One such dataset was the vast collection of intercepted Palestinian calls that until August was stored on Microsoft’s cloud platform. According to intelligence sources, the Israeli military planned to move the data to Amazon Web Services (AWS) datacentres.
Amazon did not respond to the Guardian’s questions about whether it knew of Israel’s plan to migrate the mass surveillance data to its cloud platform. A spokesperson for the company said it respected “the privacy of our customers and we do not discuss our relationship without their consent, or have visibility into their workloads” stored in the cloud.
Asked about the winking mechanism, both Amazon and Google denied circumventing legally binding orders. “The idea that we would evade our legal obligations to the US government as a US company, or in any other country, is categorically wrong,” a Google spokesperson said.
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Referring to statements Google has previously made claiming Israel had agreed to abide by Google policies, the spokesperson added: “We’ve been very clear about the Nimbus contract, what it’s directed to, and the terms of service and acceptable use policy that govern it. Nothing has changed. This appears to be yet another attempt to falsely imply otherwise.”
However, according to the Israeli government documents detailing the controls inserted into the Nimbus agreement, officials concluded they had extracted important concessions from Google and Amazon after the companies agreed to adapt internal processes and “subordinate” their standard contractual terms in favour of Israel’s demands.
A government memo circulated several months after the deal was signed stated: “[The companies] understand the sensitivities of the Israeli government and are willing to accept our requirements.”
How the secret code works
Named after the towering cloud formations, the Nimbus contract – which runs for an initial seven years with the possibility of extension – is a flagship Israeli government initiative to store information from across the public sector and military in commercially owned datacentres.
Even though its data would be stored in Google and Amazon’s newly built Israel-based datacentres, Israeli officials feared developments in US and European laws could create more direct routes for law enforcement agencies to obtain it via direct requests or court-issued subpoenas.
With this threat in mind, Israeli officials inserted into the Nimbus deal a requirement for the companies to a send coded message – a “wink” – to its government, revealing the identity of the country they had been compelled to hand over Israeli data to, but were gagged from saying so.
Leaked documents from Israel’s finance ministry, which include a finalised version of the Nimbus agreement, suggest the secret code would take the form of payments – referred to as “special compensation” – made by the companies to the Israeli government.
According to the documents, the payments must be made “within 24 hours of the information being transferred” and correspond to the telephone dialing code of the foreign country, amounting to sums between 1,000 and 9,999 shekels.
Under the terms of the deal, the mechanism works like this:
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If either Google or Amazon provides information to authorities in the US, where the dialing code is +1, and they are prevented from disclosing their cooperation, they must send the Israeli government 1,000 shekels.
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If, for example, the companies receive a request for Israeli data from authorities in Italy, where the dialing code is +39, they must send 3,900 shekels.
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If the companies conclude the terms of a gag order prevent them from even signaling which country has received the data, there is a backstop: the companies must pay 100,000 shekels ($30,000) to the Israeli government.
Legal experts, including several former US prosecutors, said the arrangement was highly unusual and carried risks for the companies as the coded messages could violate legal obligations in the US, where the companies are headquartered, to keep a subpoena secret.
“It seems awfully cute and something that if the US government or, more to the point, a court were to understand, I don’t think they would be particularly sympathetic,” a former US government lawyer said.
Several experts described the mechanism as a “clever” workaround that could comply with the letter of the law but not its spirit. “It’s kind of brilliant, but it’s risky,” said a former senior US security official.
Israeli officials appear to have acknowledged this, documents suggest. Their demands about how Google and Amazon respond to a US-issued order “might collide” with US law, they noted, and the companies would have to make a choice between “violating the contract or violating their legal obligations”.
Neither Google nor Amazon responded to the Guardian’s questions about whether they had used the secret code since the Nimbus contract came into effect.
“We have a rigorous global process for responding to lawful and binding orders for requests related to customer data,” Amazon’s spokesperson said. “We do not have any processes in place to circumvent our confidentiality obligations on lawfully binding orders.”
Google declined to comment on which of Israel’s stringent demands it had accepted in the completed Nimbus deal, but said it was “false” to “imply that we somehow were involved in illegal activity, which is absurd”.
A spokesperson for Israel’s finance ministry said: “The article’s insinuation that Israel compels companies to breach the law is baseless.”
‘No restrictions’
Israeli officials also feared a scenario in which its access to the cloud providers’ technology could be blocked or restricted.
In particular, officials worried that activists and rights groups could place pressure on Google and Amazon, or seek court orders in several European countries, to force them to terminate or limit their business with Israel if their technology were linked to human rights violations.
To counter the risks, Israel inserted controls into the Nimbus agreement which Google and Amazon appear to have accepted, according to government documents prepared after the deal was signed.
The documents state that the agreement prohibits the companies from revoking or restricting Israel’s access to their cloud platforms, either due to changes in company policy or because they find Israel’s use of their technology violates their terms of service.
Provided Israel does not infringe on copyright or resell the companies’ technology, “the government is permitted to make use of any service that is permitted by Israeli law”, according to a finance ministry analysis of the deal.
Both companies’ standard “acceptable use” policies state their cloud platforms should not be used to violate the legal rights of others, nor should they be used to engage in or encourage activities that cause “serious harm” to people.
However, according to an Israeli official familiar with the Nimbus project, there can be “no restrictions” on the kind of information moved into Google and Amazon’s cloud platforms, including military and intelligence data. The terms of the deal seen by the Guardian state that Israel is “entitled to migrate to the cloud or generate in the cloud any content data they wish”.
Israel inserted the provisions into the deal to avoid a situation in which the companies “decide that a certain customer is causing them damage, and therefore cease to sell them services”, one document noted.
The Intercept reported last year the Nimbus project was governed by an “amended” set of confidential policies, and cited a leaked internal report suggesting Google understood it would not be permitted to restrict the types of services used by Israel.
Last month, when Microsoft cut off Israeli access to some cloud and artificial intelligence services, it did so after confirming reporting by the Guardian and its partners, +972 and Local Call, that the military had stored a vast trove of intercepted Palestinian calls in the company’s Azure cloud platform.
Notifying the Israeli military of its decision, Microsoft said that using Azure in this way violated its terms of service and it was “not in the business of facilitating the mass surveillance of civilians”.
Under the terms of the Nimbus deal, Google and Amazon are prohibited from taking such action as it would “discriminate” against the Israeli government. Doing so would incur financial penalties for the companies, as well as legal action for breach of contract.
The Israeli finance ministry spokesperson said Google and Amazon are “bound by stringent contractual obligations that safeguard Israel’s vital interests”. They added: “These agreements are confidential and we will not legitimise the article’s claims by disclosing private commercial terms.”