What makes the explosive reactive armor system Nozh ('knife') system (developed by Microtech) unique is its operation principle. This is the principle of directive concentrated effect of individual dedicated charges contained in each of the Nozh modules on an incoming anti-tank projectile that contacts with the tank armor.

Once the projectile hits an ERA module, a pin-point blasting of individual charges (knifes) takes place to destroy the projectile. Employing the principle of directive destroying effect allowed it to create an explosive reactive armor system that efficiently defeats attacking projectiles, no matter what type of warheads these may carry — armor-piercing projectiles or hollow-charge rounds, or striking-nucleus-type impact shells. The ERA system is equally efficacious against Soviet-era-vintage projectiles and western-designed munitions.

ERA modules Nozh are accommodated in dedicated Morozov-designed sections fitted exteriorly to the tank, allowing it to keep adjacent ERA modules intact, and thereby increasing the entire system's survivorship by 200 to 300 percent. In case of older ERA designs, subject to destruction were considerable numbers of adjacent modules that were not directly hit by an inbound projectile. Occurrences were reported in which about fifty percent of all ERA modules on a given side of the tank were destroyed by an explosion resulting from activation of only one container with ERA elements on the same side of the tank. In fact, this ERA protection was nonrecoverable for the given side of the tank (left or right sides, front or turret).

The Ukrainian ERA design provides considerable advantages in performance over similar foreign-designed equivalents, such, in particular, as the Russian ERA system with the 4C20 and 4C22 elements. The Nozh provides reliable security not only against non-tandem-type hollow-charge projectiles but also armor-piercing subcaliber rounds or striking-nucleus-type impact munitions. By expert estimates, the Ukrainian ERA designers have outpaced their Russian counterparts by one R&D phase as of this day, which is equal to at least five years by Soviet-era standards.

Nozh competes in performance with other foreign-designed alternatives. For example, the French-designed ERA system for the Leclerc tank has no better performance characteristics than the Soviet (Russian) equivalent with 4C20 elements. This is also true for the Israeli designs - incidentally the world's first production ERA systems to be integrated on armored vehicles (Merkava tanks in the early 1980s).

The Nozh ERA system has already been deployed with the Ukrainian army, and is now being integrated onto modernized T-64 Bulat tanks. The Ukrainian Defense Ministry earlier in 2006 commissioned 17 Nozh kits for Bulats, with 23 more such kits planned to be purchsed next year. It is planned that Nozh will be installed in all of the tanks to be commissioned by the Ukrainian armed forces, including the newly-designed Oplot.

These days, Microtech is working intensively on an ERA development project for lightweight armored fighting vehicles (LAFVs). The challenge is to provide reliable protection against 20-30-mm gun shells and anti-tank grenades. One of the Nozh configurations has proved highly efficacious against 23-mm and 30-mm MAP-type rounds, as well as PG-7 and PG-9 grenades.

There is one more version of the Nozh system designed specially for LAFVs. In its configuration, dimensions, the amount of explosive, composition and mass, it is different from its namesake designed for tanks. A full ERA set for the BMP-3 infantry fighting vehicle comprises about 300 Nozh modules, its mass overall depending not only on the Nozh modules as such but also on other constructs that supplement the ERA to enable it to operate as designed. Those are load-carrying screens integrated exteriorly at some distance away from the vehicle's body, on which Nozh modules are mounted in this particular case.