Thousands of protesters have taken to the streets in Polish cities against the governing Law and Justice party's reforms, which would give parliament powers over the selection of judges.
First vice-president of the EU Commission, Frans Timmermans, remarked that the reforms in Poland may "increase significantly the systemic threat to [the] rule of law".
Polish President Andrzej Duda on Tuesday signed into law a bill giving the justice minister the power to replace heads of ordinary courts.
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It has routinely criticized Western liberal democracy, often making points similar to those of Hungary's controversial Prime Minister Viktor Orban, another European Union leader from the former communist Eastern Europe who has become notorious for his vision for an "illiberal democracy".
The European Commission said in a statement that it "urges the Polish authorities to put the new laws on hold" and that it would "swiftly prepare infringement procedures for breach of EU law" against Warsaw to be discussed next week.
The Polish interior ministry has accused EU officials of exceeding their powers after the European Commission stepped up its legal case against Warsaw over its refusal to accept migrants from states under pressure.
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But the contribution to growth from home buying had its biggest fall in almost seven years, slipping 6.8 percent. In the other major categories, business investment in plant and equipment grew at a 5.2 percent rate.
But Prime Minister Beata Szydlo said the government would not yield "to pressure from the street and overseas", signalling it would not abandon the plans.
"The Commission is determined to defend the rule of law in all our member states as a fundamental principle on which our European Union is built".
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"If the Polish government goes ahead with undermining the independence of the judiciary and the rule of law in Poland, we will have no other choice than to trigger Article 7", he added. "All the laws prepared by the Polish parliament are in compliance with the constitution and democratic rules", Polish government spokesman Rafal Bochenek told the PAP news agency.