The European Union has begun legal proceedings against the UK over Boris Johnson’s plan to breach the terms of its Brexit divorce deal.
An EU deadline for the government to remove sections of the Internal Market Bill expired on Wednesday.
European Commission president Ursula von der Leyen, said:"The commission has decided to send a letter of formal notice to the UK government.This draft bill is by its very nature a breach of the obligation of good faith laid down in the Withdrawal Agreement.”
The bill has been seen as an attempt by the UK to get better terms from the EU by threatening the status of Northern Ireland. Without a deal, they will bow out of the bloc’s single market and customs union on 31 December, burdening businesses and consumers with additional costs and disruption.
A spokesperson for the UK government said the bill was a necessary "safety net" to protect trade between different parts of the UK.
They added the government would respond the EU's letter "in due course".
UK-EU trade talks are continuing in Brussels this week. Prime Minister Boris Johnson has said both sides should "move on" if a deal was not reached by mid-October.
Labour leader Sir Keir Starmer called for both the UK and EU to work together over trade differences, adding: "A deal can be done here".
"It's absurd that with weeks to go, the focus and the energy is not on their negotiations, it's on threatened court proceedings," he added.
Both sides insist they do want a deal within the coming weeks, but the EU says it won't sign one off, as long as the UK's bill remains as it is.
The Internal Market Bill cleared its final stage in the House of Commons on Tuesday and will move to the House of Lords, where Boris Johnson’s party doesn’t have a majority.
The bill sets out rules for the operation of the UK internal market - trade between England, Scotland, Wales and Northern Ireland - after the end of the Brexit transition period in January. the proposal includes, giving UK ministers powers to modify or "disapply" rules relating to the movement of goods that will come into force from 1 January, if the UK and EU are unable to reach an alternative agreement through a trade deal.
Senior EU officials have said that any EU-UK trade agreement will not be ratified by the European Parliament this December unless the UK removes the offending clauses from the internal market bill that legally overwrite the obligations to implement the protocol on Northern Ireland.
Trade talks in Brussels will end on Friday. At stake is whether enough progress can be made on crucial points such as fishing rights and rules on state subsidies to justify shifting into intensified “submarine” negotiations.