Elbit, a subsidiary of an Israeli defence company, won a contract more than a decade ago to install the crucial battle management software into Army equipment. Elbit won another contract in 2018.

The BMS, which allows for high-level communication in the battlefield, brought Army into the digital age. Elbit has been more recently attempting to push the BMS into other industries outside defence, where it said it could be used in emergency management such as bushfires.

The BMS was originally designed for use by the Israeli military.

The ABC is reporting that Army issued a directive ordering Defence to “cease use” of the Elbit BMS system over concerns it may breach security data.

The issue is getting extensive coverage in Israeli and defence industry media where it has been claimed that the contract was about to be awarded to a US company and that Elbit had been notified its software would be removed on May 15.

Elbit Australian managing director and former Army major general Paul McLachlan said the company rejected “rumours” of a security breach.

“Elbit Systems of Australia utilises secure software development processes in collaboration with the Department of Defence, including the provision of all source code,” he said.

“Elbit Systems of Australia will continue to work closely with the ADF to deliver its network capability requirements, utilising our 250-strong workforce, including 80 military veterans and 100 systems and software engineers.

“Elbit Systems of Australia is expanding and enhancing our proven ability to bring world-leading innovative technologies to meet Australian capability requirements for the ADF, homeland security and emergency management agencies into the future.”

Defence Minister Peter Dutton would not comment on the issue this morning.