The British Irish Chamber of Commerce has welcomed the extension of Article 50 granted at the emergency meeting of the European Council last night.
European Union leaders agreed to delay Brexit until October 31.
Taoiseach Leo Varadkar and other EU leaders signed off on the "flex-tension" offer to British prime minister Theresa May after hours of talks late last night in a plan that will allow Britain to leave the EU as soon as Westminster passes a deal.
Director General of the British Irish Chamber, John McGrane said: “The British Irish Chamber of Commerce welcomes the extension granted by European leaders last night.
“Businesses have long warned of the dangers of a ‘no deal’ Brexit and last night’s decision decreases the likelihood of such an outcome coming to pass. The UK now has the breathing space it needs to come together and find a way forward that can find a consensus among parliamentarians and deliver for business and trade.
“Recently we have seen a greater focus on the future relationship between the UK and EU and the prospect of a customs arrangement - between the UK and EU with UK input into future trade deals - is gaining momentum. This could be the key to breaking through the current impasse."
The business group said it would protect the trade relationship between Ireland and the UK.
Mr McGrane said: “While last night’s decision lessens the likelihood of a ‘no deal’ departure, it does not eliminate it entirely. Continued uncertainty jeopardises significant parts of the €70bn worth of trade and 400,000 jobs involved in British-Irish business and it is in the interests of all that we find a solution and do not just move the cliff edge to a new date at the end of October.
“The British Irish Chamber also encourages all UK and EU leaders to remain open-minded to any credible proposals that may come forward from the current UK cross-party talks.”
David Carson, Brexit Lead at Deloitte Ireland, said: “Business reaction to a further extension is muted - on the plus side it removes an immediate unknown and has removed the prospect of an imminent no deal scenario. But those that have extensively prepared, for two different dates already, are frustrated to now have a third date to work towards.
“Prolonged uncertainty may continue to delay investment decisions that companies here in Ireland may be considering, and companies now face a further period of limbo. Those Irish businesses that have invested significant time and money to get Brexit-ready will be keen for there to be clarity in advance of the 31 October deadline.
“For those businesses that are still trying to take stock of what Brexit may mean for them, our advice is to continue to consider all options and those steps that potentially add value to your business whatever the direction of Brexit. Identifying the impact of Brexit on market access and supply chains and customs, in addition to reviewing contracts is very important, as is keeping abreast of the latest requirements and guidance issued by the Governments and agencies in both Ireland and the UK. Regular engagement and communication with employees is critical, and of course, keeping close to customers remains of paramount importance.”