European Union demands United Kingdom drop a planned law that breaches Brexit deal

Markets diverge ahead of ECB meeting

Johnson's government said this week it planned to break worldwide law by breaching part of the Brexit Withdrawal Agreement treaty signed in January when Britain left the bloc, saying it needed a new law to protect free trade between the four constituent nations of the United Kingdom.

"Whatever form it takes, Brexit can not be allowed to imperil the Good Friday Agreement, including the stability brought by the invisible and frictionless border between the Irish Republic and Northern Ireland", Pelosi said in a statement.

In a statement, the European Union said that "the Vice-President stated, in no uncertain terms, that the timely and full implementation of the Withdrawal Agreement, including the Protocol on Ireland / Northern Ireland - which Prime Minister Boris Johnson and his government agreed to, and which the UK Houses of Parliament ratified, less than a year ago - is a legal obligation".

European Union chief negotiator Michel Barnier warned that Brussels was increasing its planning for a no-deal Brexit after trade talks made little progress.

Sir Bernard Jenkin, the leader of the European Research Group, said the admission by ministers that provisions in the Internal Market Bill breached global law had been "very surprising".

The meeting was called by Mr Šefčovič after the publication of Prime Minister Boris Johnson's Internal Market Bill on September 9 - which seeks to undermine elements of the Brexit Withdrawal Agreement.

"Breaking worldwide law is not acceptable and does not create the confidence we need to build our future relationship, '" EU Council President Charles Michel said.

"In fact", the statement said, Brussels "is of the view that it does the opposite". "This is a unilateral, provocative act that is uniquely unprecedented", Ireland's Europe Minister Thomas Byrne said on BBC radio.

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The UK government wants a "level playing field" for selling goods around the UK, but by cutting away at devolved powers in the Internal Market Bill it could break the deal agreed over the future trade arrangements for Northern Ireland.

But it says the breach is minor, and denies trying to renege on the agreement, which commits both sides to ensuring there are no customs posts or other obstacles on the Northern Ireland-Ireland border.

"We are not going to carry out any "empty chair" diplomacy, that is quite clear", he added. Doing this paved the way for the ratification of the Withdrawal Agreement and prevented the need for a hard border. The reasoning is that goods might pass from Ireland to Northern Ireland without being checked, providing an opportunity to evade any law governing those exports.

Lord Howard described the government's admission that the proposed legislation would break worldwide law as a "very, very sad day". The bill is likely to face strong opposition when it is debated in Parliament next week.

Even so, British in Europe say that if the United Kingdom does not intend to honour one part of the WA agreement, "it sends a message to the EU" that "it can not be trusted to implement the other parts", putting the deal further at risk.

The source said "we're not in the same place" as previously on Brexit matters.

And while boasting of its newly minted trade deal with Japan, the government was warned that the ructions over Northern Ireland could deprive it of another glittering prize - a similar pact with the United States.

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