The European Commission said on Tuesday it would not move to the next step of its legal action against Britain for changing trading arrangements on Northern Ireland, in response to Britain's request for a "standstill".
The EU in March began an infringement procedure against Britain for making changes to the Northern Ireland trade arrangements, which Brussels says breach the Brexit divorce deal agreed to with London last year.
The Northern Ireland protocol was part of the Brexit settlement backed by UK Prime Minister Boris Johnson.
The deal finally sealed Britain's divorce from the EU four years after voters backed leaving in a referendum.
Brexit minister David Frost told Parliament on July 21 that London wanted to renegotiate the protocol and asked for a standstill that would extend current grace periods on trade between Britain and Northern Ireland and freeze EU legal action.
The commission rejected the idea of a renegotiation of the Brexit treaty, but on Tuesday agreed to freeze its legal action.
"With regards to the request for a standstill, the commission will carefully assess the new proposals made by the UK, in accordance with the necessary consultation procedures, both internally and with the European Parliament," a commission spokeswoman said.
"In order to provide the necessary space to reflect on these issues and find durable solutions to the implementation of the protocol, we have decided, at this stage, not to move to the next stage of the infringement procedure started in March."
Businesses in Northern Ireland say the protocol is damaging trade.
Some pro-British groups have protested against what they say is a weakening of ties with Britain, raising concerns about a return to the violence that plagued the province for three decades.