LEAVING the EU will dilute the rights of companies and individuals to sue the government because of a “chilling” clause buried in the main Brexit Bill, lawyers have warned.

The EU (Withdrawal) Bill ends the right to compensation for serious breaches of Brussels regulations in areas such as air pollution and the environment, it has emerged.

The passage relates to a 1991 European Court of Justice ruling known as Francovich.

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It states: "There is no right in domestic law on or after exit day to damages in accordance with the rule in Francovich."

Notes accompanying the Bill says the change will not affect people’s right to claim damages under existing British law.

However campaigners say the end of the Francovich ruling, which has been used in the past to challenge the government, means a significant watering down of existing rights.

Liberty director Martha Spurrier, said: “This chilling clause, buried deep in the Bill's small print, would quietly take away one of the British people's most vital tools for defending their rights. Putting the Government above the law renders our legal protections meaningless.

"It exposes a clear agenda to water down our rights after Brexit.

"We cannot trust a handful of ministers with our hard-won rights and freedoms.

“We need a formal commitment in the repeal Bill, in the black and white letter of the law, that the British people will not leave the EU with fewer rights than we have now."

David Hart, QC, who practises environmental law, told the Times newspaper: "This seems to be a blatant way of Government seeking to avoid responsibilities.

“If you take an area like pollution, it means that the Government will escape any liability under the Francovich principle for past and future breaches."

Frances Lawson, a barrister preparing a Francovich case against the Government over air pollution, added: "We are trying to move the case forward as quickly as we possibly can. If the Government means what it says about ensuring equivalence in environmental protection after Brexit, they need to come up with a way to give people a similar form of redress."

Labour MP Chris Leslie, speaking on behalf of the pro-EU Open Britain campaign, said: “This is exactly what we were told the repeal Bill would not be used for but it looks like another broken Brexit promise.

"Ministers have repeatedly pledged not to use Brexit to undermine our rights but those warm words are not being backed up by action.

"The wording in the Bill is so broad that it represents a fundamental watering down of rights to redress against the state and ministers should be made to justify such a change.

"The Government should ensure in law that none of our rights are lost after Brexit."

LibDem MP Tom Brake added: "This is a shameless attempt to take away people's rights through the back door. Citizens must be able to hold the Government to account.”

A Government spokesman said: "The right to Francovich damages is linked to EU membership - the Government therefore considers that this will no longer be relevant after we leave. After exit, under UK law it will still be possible for individuals to receive damages or compensation for any losses caused by breach of the law."