The European Commission has threatened Ireland with legal action unless it stops the Gardai from conducting random insurance checks on foreign-registered vehicles.
The EC claims such inspections violate EU laws allowing the free movement of goods and people throughout the union.
A statement issued today warned: "If Ireland does not amend its legislation within two months of receiving the reasoned opinion, the commission may decide to bring the matter before the (European) Court of Justice."
The EC said the random Garda inspections violate the First Motor Insurance Directive, which is aimed specifically at boosting the single market's commitment to free movement.
The directive abolished checks on insurance green cards for vehicles based in one member state which enter the territory of another.
However, under the 1961 Road Traffic Act, the Gardai are still allowed to check insurance discs on any vehicle in a public place in Ireland.