The Northern Ireland Protocol has created a "feast or famine" economy in the North with some businesses struggling while others thrive, a UK parliamentary report has found.

A House of Lords committee examining the post-Brexit Irish Sea trading arrangements found that companies involved in trade with the rest of the UK were being hampered by added red tape, whereas those more reliant on doing business with Ireland and the wider EU were benefiting.

The committee stressed an urgent need to resolve the issues created by the protocol and called on the EU and UK to re-engage in negotiations.

The committee's report comes amid a breakdown in relations between London and Brussels over the UK government's controversial plan to pass legislation at Westminster that would empower ministers to unilaterally rip up the bulk of the protocol.

Peers said the two sides needed to rebuild trust, repair damaged relationships and recommit to finding an agreed resolution.

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The protocol was agreed by the EU and UK in 2019 as a way to avoid a hard land border on this island. It did so by moving regulatory and customs processes to the Irish Sea, creating new checks on goods being shipped from Great Britain to Northern Ireland.

Michael Jay, who chairs the Protocol on Ireland/Northern Ireland Committee, said: "The committee's engagement with businesses trading in and with Northern Ireland has demonstrated that, while much uncertainty remains, the economic impact of the protocol is gradually becoming clearer.

"The situation was described to us as 'feast or famine', whereby businesses able to take advantage of the protocol benefit, while those dependent on trade with Great Britain lose out."

For its report, the committee took evidence from the five biggest parties in the North, the UK and Irish governments, business representatives, academics and civic society representatives.