Brexit: EU takes legal action against UK over Internal Market Bill
Follow UsStory highlights
The move comes as British and EU negotiators struggle to close the gap on state aid in parallel trade negotiations that have been overshadowed by the new controversy over the Internal Market Bill
The European Union on Thursday launched a legal case against Britain over its new Internal Market Bill that would breach parts of the legally binding divorce agreement the two sides reached late last year.
The action underscored EU's worsening relations with Britain, which was a member of the bloc until January 31.
Both sides are trying to forge a rudimentary free trade agreement before the end of the year, but the fight over the controversial UK Internal Market bill has soured relations this month.
The EU had given London until Wednesday to withdraw the bill but instead UK lawmakers voted 340-256 Tuesday to push the legislation past its last major House of Commons hurdle.
It must also be approved by the House of Lords, where it is sure to meet strong opposition because it breaches international law.
At the same time, EU and UK officials were continuing talks on a trade deal, going into detailed negotiations over everything from fisheries rights, state aid rules and legal oversight in case of disputes.
Also read: Brexit provisions to stay in Internal Market Bill as UK shows 'no indication' of withdrawal
European Commission President Ursula von der Leyen said the draft bill was a "breach of obligation of good faith" established in the Withdrawal Agreement, and would contradict the protocol of Ireland/Northern Ireland.
Such so-called infringements could lead to hefty fines being imposed by the EU's top court but that takes years, leaving plenty of time for the UK to change tack.
London now has one month now to reply to a formal letter of complaint from the Commission, which will then assess whether the answer is satisfactory and can then request that the UK falls back in line. If that fails, it can sue at the Luxembourg-based European Court of Justice.
The move comes as British and EU negotiators struggle to close the gap on state aid in parallel trade negotiations that have been overshadowed by the new controversy over the Internal Market Bill.