Theresa May avoids defeat over key rebel amendment on customs union by just six votes

• Government defeats rebels by six votes as MPs vote 307 to 301 against customs union amendment

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Theresa May has seen off a damaging defeat in the House of Commons after Tory Remainer rebels attempted to force her to change her Brexit strategy.

Remainers attempted to force a move which would require the Government to strike a customs union agreement with the EU if Mrs May is unable to deliver by mid-January her Chequers plan for a UK-EU free trade area.

But the Government won the vote by 307 to 301, defeating rebels. 

Mrs May has repeatedly ruled out being in a customs union with Brussels after Brexit on the grounds it would leave Britain too closely tied to the EU. 

The win means she has seen off a challenge from the anti-Brexit MPs in her party following her decision to accept amendments tabled by Brexiteers, but it won't settle the deep division in the Conservatives over how to move forward from here. 

7:05PM

Who were the Tory rebels on clause 18 vote?

There were 12 Tories who voted against Theresa May on the crucial clause 18 vote despite repeated warnings by the whips. 

They were:

But it was Labour who really helped the PM over the line, specifically Kate Hoey, Frank Field, John Mann and Graham Stringer who all backed the Government and rebelled against their own party. 

Kelvin Hopkins, who is an independent, also backed Mrs May. 

7:03PM

How each MP voted on clause 17

7:02PM

Rude typo sparks rare moment of Brexit levity 

As MPs and journalists try to keep up with the goings-on in the Chamber on Twitter, the Guardian has provided a rare moment of hilarity with a typo which prompted giggles here in the lobby...

6:57PM

Liam Fox kicks off third reading of trade bill

Well, that was a roller-coaster of a ride wasn't it. 

The Prime Minister has shrugged off a challenge by her own backbenchers but only because of rebel Labour MPs. Labour is claiming a near-victory, despite it being Labour MPs who helped the PM out of a hole... 

In the meantime Liam Fox the Trade Secretary is now kicking off the third reading of the Trade Bill in the Commons. Nothing to see here... 

6:54PM

Pound rallies after PM defeats rebels

6:48PM

Theresa May can breathe a sigh of relief ... for now

So the Prime Minister has seen off a vote which many said could have meant the end of her time in Number 10 - or at least the beginning of the end. 

Mrs May and her whips managed to convince enough MPs not to back the amendment brought forward by Tory MP Stephen Hammond, seeing off a plan to tie the UK to the customs union after Brexit. 

There had been claims that whips were threatening MPs with a general election if they backed the plan. 

In the end 307 voted against the amendment while 301 backed it.

Some Tory MPs felt unable to vote for something which would go against the party's manifesto, on which they all stood for election. For others Brexit became more important and they rebelled against their Government. 

The impact of the vote will become clear in the coming days, but the bad feeling among Conservative MPs is unlikely to subside after this. 

6:44PM

Government has won the crucial vote on clause 18 - defeating rebels

Despite losing an earlier vote on medicines, the Government has won a crunch vote on the customs union by a margin of 307 to 301. 

That majority of MPs voted against including the new amendment, which was tabled by Stephen Hammond, an anti-Brexit Tory MP who said he had drawn it up "with a heavy heart". 

6:39PM

A bit of banter in the Commons

... as MPs trundle through the lobbies to vote on clause 18,  Jess Phillips taunts Jacob Rees-Mogg:

On a serious note,  the vitriol and bad feeling across the House of Commons chamber and among MPs in the same party is palpable tonight. Are we watching the fracturing of both parties?

6:35PM

Meanwhile... 

As MPs vote in the Commons, someone in Brussels must be watching closely. Looks like EU members states are going to be asked to start preparing for a no deal scenario. 

6:31PM

Government loses vote on keeping UK in medicines agency

The Government has lost a vote on keeping the UK in the European Medicines Agency after Brexit by a margin of 305 to 301. 

This is only the second loss for the Prime Minister on crucial Brexit legislation in the Commons. 

It was also the test case for new clause 18 - the one Theresa May really doesn't want to lose. MPs are voting on this now... 

The amendment was brought by one of Theresa May's former ministers who recently resigned over her Brexit position. 

Here's his take on what it means:

There is a feeling that things could be about to break down entirely here in Parliament...

6:21PM

Tough talk in the Commons

There are rumours that MPs are being threatened with a general election if they back new clause 18, the amendment tabled by Stephen Hammond. 

The Government tried to head it off at the pass but looks to have failed, the vote is expected at 18.45 but in the meantime the whips - the MPs responsible for discipline - are trying hard to block it. 

By the sounds of it this is a last ditch attempt to prevent the amendment going through. Most Tory MPs do not want another election because they fear they could lose it ... that and everyone is tired and wants a summer break. 

Desperate times ... 

5:46PM

Horse trading begins

Stephen Hammond, who tabled clause 18, says that whilst he accepts the result of the referendum but believes that it is for Parliament to set the terms and conditions. 

He says the amendment is in line with Mrs May's Brexit white paper, but the Government has a problem with the term 'customs union', which trade minister George Hollingberry confirms. 

Intervening, Mr Hollingberry dangles a carrot to Mr Hammond: withdraw his amendment and he will put forward a very similar proposal in the House of Lords when the Bill arrives there.

Crucially, the new proposal will omit the term "customs union", as to accept it would be to breach the Government's red lines. 

However, Mr Hammond hasn't signed up just yet. He asks Mr Hollingberry to accept his amendment now and then tamper with it in the Lords. 

It's highly likely the pair will start  bartering before the vote takes place, with the Government hopeful they can talk Mr Hammond and the rebels into backing down. 

5:35PM

MPs now debating customs union amendment

The Commons are onto the final group of amendments and clauses to the Trade Bill, the most important of which - clause 18 - would force the Government to pursue a customs union with the EU as a negotiating objective. 

This vote, due at 6pm, is expected to come down to the wire, as both Labour and a number of Tory Remainers are expected to vote for it. 

There was some suggestion the amendment could be pulled last-minute, but if not, it remains uncertain whether the Government can find the numbers to stave off a damaging defeat. 

5:25PM

Sir John Major suggests there could be an Autumn election

Not another one...

Unfortunately Brenda from Bristol, the former prime minister Sir John Major believes that the current Brexit chaos could bring about a "much earlier general election than anybody is anticipating". 

Speaking to ITV's Robert Peston this afternoon, Sir John has claimed that the entrenched position of Tory Brexiteers make it "very difficult" for Mrs May to negotiate with them. 

Following Downing Street's submission to the European Research Group last night, which saw the Government accept four amendments designed to 'wreck' Mrs May's Chequers deal, he adds that much of what they are proposing is "pie in the sky". 

Asked whether Mrs May faced a more difficult task managing her unruly backbenchers today than his so-called 'bastards' of the Eighties, Sir John added: "I do. I do think they are more entrenched. If I may say so. I say it with reluctance." 

He continued: 

Asked whether he believed Tory infighting could bring down the Government, he said: 

"I think what they are doing is quite likely to lead to a much earlier general election than anybody is anticipating.

"Whether that’s this Autumn or next Spring I can’t say but I think the way they are continually chipping away against the unity of the government and you have people in government who we are told, through the media, are thinking about whether they should resign or not. "

5:02PM

An artist's impression...

Here's The Telegraph's cartoonist's take on the latest Brexit chaos. 

4:54PM

MPs trash May's proposal for early summer holiday

In yet another setback for Downing Street, attempts to cut short this Parliamentary session appear to be unravelling. 

Whilst MPs were initially due to rise for the summer recess on 24 July, a motion was put forward on Monday night which would see the Commons rise on Thursday, with a vote pencilled in for Tuesday evening.

However, Labour is understood to have instructed its MPs to vote against the move and several pro-European Tories have already indicated they will oppose any attempt to cut short the term with so much work to do on Brexit.

A strong rebellion on the Conservative benches could lead to an embarrassing defeat for a Government currently assailed on all sides over its plans for leaving the European Union.

Dr Sarah Wollaston, a member of the Health Select Committee, said the committee would sit as planned next Tuesday, while Phillip Lee, who quit as a minister over Brexit, condemned any thought of an earlier break as "shameful" at such a "crucial time".

Asked whether the Government intended to press ahead with a vote on bringing the recess date forward, Mrs May's official spokesman said: "The Government came forward with this proposal following discussions with other parties. We are considering all of the representations which have been received."

He added: "It is a non-sitting Friday this week and there is no substantive Government business next week."

4:34PM

Government accused of 'power grab' 

Labour has accused the Government of a trade policy "power grab" as veteran Tory MP Ken Clarke criticised his frontbench for a "scandalous abuse" of Parliament.

The comments came as MPs resumed debate of the Trade Bill, which is one of a series of Brexit Bills that intend to adjust UK legislation in preparation for when Britain leaves the EU.

Mr Clarke rounded on ministers at the outset of the debate, criticising the "limited opportunities" for discussion of the Bill's implications.

The Father of the House said: "The moment that we have an important Bill like yesterday and today, the Government is anxious that the House of Commons should have no opportunity to talk about it, limited opportunities to vote about it and it should be got out of the way as quickly as possible and I really do think the convention needs to be challenged."

Speaker John Bercow sought to reassure Mr Clarke, telling MPs that "on the matter of votes, the Speaker will do everything possible to facilitate votes that members wish to have".

International trade minister George Hollingbery, introducing the Bill at report stage on behalf of the Government, said the legislation was about "continuity".

The Bill does not address trade agreements themselves - these can only be struck after the transition period - but gives the Government powers to change domestic legislation to fulfil obligations.

A number of amendments have been tabled by MPs to the Bill, including one by Remainer Tory MPs which seeks to ensure the Government negotiates involvement in a customs union with the European Union.

Mr Hollingbery, moving the Government's amendments to the Bill, said: "I recognise that members are seeking reassurance that the Government will be transparent about the content of these transitioned agreements and what might need to change to deliver this continuity that we have championed for so long."

He added that reports published by the Government on future agreements will "signpost" any changes in a bid to enhance Parliamentary scrutiny.

Tory former minister Jonathan Djanogly, who tabled amendments designed to curb ministerial powers in the Bill, welcomed the Government's amendments and said he would support them.

Shadow international trade minister Bill Esterson accused the Government of a "power grab", saying that currently the UK has scrutiny on trade agreements through the European Parliament and through the EU Scrutiny Committee which will be lost in this Bill.

He said: "The Government is not proposing any equivalent scrutiny processes for agreements that will replace those we currently have through our membership of the EU, this lack of scrutiny is a major issue and we raised the concerns of business, trade unions, civil society, consumers and many more at committee."

Former trade minister Greg Hands said Labour was "barking up the wrong tree" with their concerns as the legislation was dealing with existing agreements that have already been scrutinised.