Boris Johnson's Brexit chief has hinted that the so-called Northern Ireland sausage ban could be avoided.
Lord Frost said the UK had submitted proposals to extend the grace period on the export of chilled meats such as mince and bangers from Britain to Northern Ireland.
Northern Irish retailers are banned from importing these products from Britain under the PM's Brexit deal, but the rules have not yet come into force.
The grace period is expected to lapse at the end of the month.
Lord Frost told the Foreign Affairs Committee: "We have put in our proposal to extend the grace period on chilled meats which expires very soon and I know both sides are thinking very actively about that."
He said progress was being made on issues, adding: "I wouldn't want to leave the impression that nothing is happening.
"Quite a lot is happening, in one or two areas there is engagement, in other areas it's more difficult."
But he warned that the EU needed to be more pragmatic over Northern Ireland or risk a threat to peace.
"What we would want to see is a kind of more pragmatic approach from the EU. If their approach is simply to say, you must just implement the EU customs' code as if this were any other external frontier of the EU, then we obviously have a problem," he told MPs.
"That's not what's happening. The delicate balance in the Good Friday Agreement risks being unsettled."
It comes after outgoing DUP leader Edwin Poots said the Government had given him personal assurance that significant changes will be made to the Northern Ireland Protocol.
Lord Frost admitted it was "hard to see" how the protocol could be sustainable in its current form.
He said: "I can't comment on private conversations and accounts of them. But we haven't made a secret of the fact that we find it hard to see how, as currently operated, important elements of the Protocol are sustainable.
"I don't think that's a new judgment. We have also said that we are considering all our options, and we are doing so.
"There is a real world timetable to things that needs to be taken into account when we do that.
"That's where we are at the moment, we are actively considering the options to deal with a situation that is hard to see as sustainable."
The Brexit Minister also disclosed that Leave campaigners "would have been surprised to think that the relationship was as relatively difficult as it is now".
