(Bloomberg) -- Theresa May risks defeat over her Brexit policy after the opposition Labour Party decided to back an amendment penned by pro-European Conservative lawmakers. Voting on the trade bill is underway, with the key voted expected in the next hour or so.

Times: PM Could Face No-Confidence Vote (5:10 p.m.)

Brexiteers could bring a vote of no confidence against Prime Minister Theresa May if lawmakers vote to keep Britain in a customs union with EU, the Times reports.

May Risks Defeat as Tory Rebels and Labour Unite (3:40 p.m.)

Prime Minister Theresa May risks defeat over her Brexit policy in the House of Commons after the opposition Labour party decided to back an amendment penned by pro-European lawmakers in her own Conservative party.

The latest flashpoint, bringing together the opposition and Tory rebels, is over an attempt to tie May’s hands by forcing her to sign up to a customs union if she fails to get a deal that would allow free and easy trade between the European Union and the U.K. by early 2019.

The opposition Labour Party will whip its lawmakers to back that amendment when it is debated on Tuesday in the lower chamber. The vote stands on a knife edge a day after May survived a vote in Parliament on Monday by a margin of just three.

All this has become a proxy war between various factions in May’s deeply divided party, with Labour seeking to exploit her lack of majority in Parliament to topple her government. While a defeat on Tuesday would not spell May’s end, it would be another uncomfortable reminder of her weakness and could make her position more precarious.

Markets are showing signs of nervousness as there are growing signs that May’s hard-won Brexit policy could be thrown into disarray. The pound snapped three days of gains to weaken as much as 0.7 percent against the dollar.

“There is anticipation that the government may well be defeated this evening,” said Neil Jones, head of hedge-fund sales at Mizuho Bank Ltd.

She survived Monday’s votes -- where she was forced to accept amendments from Brexit hardliners -- because of absentees including Liberal Democrat Leader Vince Cable and his predecessor Tim Farron, but on Tuesday, she may not be so lucky: The rebels already proved in December they’re capable of defeating the government.

Earlier:U.K.’s May in Brexit Turmoil With Parliament Majority SlashedBrexit Campaign Violations Spur Renewed Demands for Another VoteVolatile Politics Could See Pound Break Out of Summer SnoozeBrexit Bulletin: A Narrow Escape

To contact the reporters on this story: Alex Morales in London at amorales2@bloomberg.net;Tim Ross in London at tross54@bloomberg.net

To contact the editors responsible for this story: Flavia Krause-Jackson at fjackson@bloomberg.net, Stuart Biggs, Emma Ross-Thomas

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