Britain is moving to override parts of the Northern Ireland Protocol amid pressure from Stormont and hardline Brexiteers in the Conservative Party. Brussels will launch three separate lawsuits against Britain in retaliation.
The Brexit Bill, which has been accused of undermining the Good Friday Agreement, is at the centre of the dispute.
Here we tell you everything you need to know about the Protocol, how Boris Johnson wants to change it and whether or not the UK and EU are headed for a trade war.
What is the Northern Ireland Protocol?
It was a deal struck between the UK and the European Union that determined what the trade rules would be for Northern Ireland after Brexit.
Northern Ireland shares a land border with Ireland, which is an EU member, over which goods move freely because there are no checkpoints.
Given all sides were committed to keeping that land border open, London and Brussels agreed to having checks on goods moving to and from the UK mainland.
But that effectively created a customs border between two different parts of the UK – Northern Ireland and Great Britain – which has infuriated Unionists.
What is the latest news?
The Northern Ireland Protocol Bill passed its second reading on Monday night by 295 votes to 221, with 283 Conservative MPs out of 359 in total voting in favour of the bill. None voted against it, while another 76 did not vote.
Theresa May on Monday night branded the Government’s plans to rip up the Northern Ireland Protocol unlawful.
In a scathing Commons speech, the former prime minister said ripping up the Northern Ireland Protocol Bill would “diminish the standing of the UK in the eyes of the world” but fail to secure a long-term solution to the sea border problem.
The second reading was the first chance MPs had to vote on the proposals.
For a year and a half, negotiators for the European Commission and the UK have been debating how trade frictions created by the Protocol can be eased.
The talks are deeply technical with no easy answers as the UK pushes to protect the integrity of the Union and Brussels tries to maintain the integrity of the single market.
Liz Truss, the Foreign Secretary, announced earlier this month that the UK would bring forward legislation to unilaterally suspend parts of the protocol.
It comes after the DUP refused to enter into power sharing in Stormont with Sinn Fein after elections in May that made the supporters of Irish reunification the biggest political party in Northern Ireland for the very first time.
The DUP made its opposition to the Protocol central to its campaign and is blocking the restoration of the Northern Ireland Assembly until it is removed or replaced, which means the Executive cannot tackle problems such as the cost of living and healthcare.
So what’s the problem?
Unionists fear the Protocol is driving a wedge between Northern Ireland and the rest of the UK.
The DUP claims the checks are driving up the cost of living but this is disputed by other parties in Northern Ireland, which claim the country’s special status in the Single Market has shielded its economy.