Northern Ireland could be granted dual UK-EU regulatory status after Brexit under proposals being considered by David Davis in a bid to secure Cabinet agreement on a “Mac Fac 2”, it has been claimed.

Under the proposals, which would model the two-tier regulatory system in Lichtenstein, the province would operate under both sets of regulations, eliminating the need for a hard border with the Republic.

According to The Sun, Mr Davis, the Brexit Secretary, has begun devising the plan after concerns were raised about the original customs solution proposed earlier this year, known as Maximum Facilitation, which involved new technology and trusted trader schemes.

Mr Davis is leading one of two Cabinet committee working groups on customs solutions.

The other is looking into ways of improving a proposed customs partnership, which has met stern resistance from ministers and backbench Brexiteers.