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Loyalist activist Jamie Bryson told the Northern Ireland Affairs Committee he was worried that the process of transition of paramilitary groups towards civilianisation had halted while concerns over post-Brexit trading arrangements remained.
Some steel exports from Great Britain to Northern Ireland are facing a 25% tariff because of changes to EU rules.
After transport firm Morgan McLernon confirmed proposals to shut its Lurgan site, a political row has arisen between the DUP and anti-Brexit parties Sinn Fein and the Alliance Party.
Loyalist paramilitaries cannot be allowed to gain "a momentum" from the Northern Ireland Protocol dispute, MPs have been told.