THE Labour Party and Britain’s communists condemned the EU’s decision to launch legal action over Brexit legislation today and warned both sides that time is running out to strike a trade deal.

The dispute over the Tories’ Internal Market Bill, which overrides parts of the Brexit Withdrawal Agreement (WA), stepped up a notch after Brussels announced that it has launched legal action over the legislation.

It comes just two weeks before the deadline that Mr Johnson’s government set for agreeing a free-trade deal with the EU.

European Commission president Ursula von der Leyen said that by seeking to unilaterally change the terms of the WA signed last year, the British government had failed to act in good faith.

“Moreover, if adopted as is, it will be in full contradiction to the protocol on Ireland and Northern Ireland,” she said.

Ms von der Leyen gave the government a month to respond to the letter, which is the first step of a lengthy formal infringement process that could end up in the European Court of Justice.

Labour Party leader Sir Keir Starmer said that the issues at stake “are quite capable of being resolved.”

“Both sides need to sit down, resolve them, get a deal,” he said.

“That’s in the national interest — it’s in our interest and the EU’s interest.”

Shadow chancellor of the Duchy of Lancaster Rachel Reeves added: “Both sides need to drop the posturing and the threats by getting back round the negotiating table and getting a trade deal done.”

The commission frequently uses the infringement process against EU states. Last year there were 800 open cases and each takes an average of 35 months to complete.

The commission has also threatened separate action against Britain through enforcement mechanisms in the WA, which could result in fines or the suspension of parts of any future UK-EU trade deal.

Communist Party of Britain general secretary Rob Griffiths said that the EU Commission was taking legal action “even before any breach of the WA has occurred.” 

“These latest threats and ultimatums underline why Britain is right to leave a set-up in which unelected EU institutions can act as both prosecutor and judge against democratically elected national governments.”

Northern Ireland is meant to adhere to some EU regulations after the transition period ends on December 31 in a bid to stop a “hard border” with the Republic.

But controversial clauses in the Internal Market Bill would give ministers powers to override two elements of the Northern Ireland protocol.

The Bill would scrap requirements for new customs arrangements in the Six Counties and would reject attempts by the EU to limit state aid and enforce EU competition terms within Britain.

It would also withdraw devolved state aid powers and would block attempts to secure such powers for regional authorities.

A British government statement said that the clauses were needed to “create a legal safety net” and that the EU’s letter would be replied to “in due course.”