Israel's attorney general on Wednesday ordered police to look into allegations of improper conduct by a confidant of Prime Minister Benjamin Netanyahu in the planned purchase of submarines from Germany.

Media reports have alleged a conflict of interest over the role played by the Netanyahu family lawyer, David Shimron, who also acts for the Israeli agent of Germany's ThyssenKrupp, which builds the Dolphin submarines.

A justice ministry statement said that after police on Wednesday received new information, attorney general Avichai Mandelblit met senior officers, the state prosecutor and senior justice officials.

"At the end of the discussion the attorney general decided to order an examination by the Israel police regarding various aspects related to the affair," it said.

It gave no further details and did not indicate who might be the subjects.

Such examinations have sometimes been a prelude to criminal investigations but can also lead police to conclude that no further action is justified.

The allegations began with a report earlier this month by private Channel 10 television on Shimron's connections.

Netanyahu, who maintains he was unaware his attorney also counselled the seller, defended the acquisition at Sunday's weekly cabinet meeting.

"The principle that guides me is clear: Israel will be able to defend itself by itself against any enemy, in any field," he said.

"The security of Israel requires the acquisition of submarines and the renewal of the submarine fleet.

"These are strategic weapons systems that ensure the future, and I tell you, the very existence of the state of Israel for decades to come."

The purchase has faced mounting calls for an investigation, especially in light of opposition from members of the armed forces command and some defence experts because of the high costs.

Israel is reportedly negotiating to buy the three submarines at a combined price of 1.2 billion euros ($1.3 billion), to replace the oldest vessels in its existing Dolphin fleet, which began entering service in 1999.

The Jewish state already has five of the state-of-the-art German submarines, with a sixth due for delivery in 2017, Maariv newspaper said.

Germany, in the form of military assistance, has so far covered a third of the costs of the submarines in the Israeli fleet.

Foreign military sources say the Dolphins can be equipped with missiles armed with nuclear warheads.

Israel is the Middle East's sole if undeclared nuclear power, refusing to confirm or deny that it has such weapons.

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THYSSENKRUPP