Friday, 31 March 2017

Brexit: EU says no to free-trade talks until 'progress' on final terms

Donald Tusk rules out parallel talks – a key aim of Theresa May’s government – as he unveils draft EU negotiating guidelines

EU leaders have said there will be no talks on Britain’s future relationship with the bloc until the UK government makes enough “progress” on the Brexit divorce – including settling its bills and citizens’ rights.
The draft circulated by Donald Tusk said Britain would need to accept EU rules during a transition period after Brexit

Donald Tusk, the European council president, said: “Once, and only once we have achieved sufficient progress on the withdrawal, can we discuss the framework for our future relationship. Starting parallel talks will not happen.”

Tusk said the EU was united behind this principle and wanted to see progress on settling the status of EU nationals and Britain’s share of EU liabilities.

Making clear that it is the EU27 who will define “sufficient progress”, draft negotiating guidelines published as Tusk spoke, also say the UK must accept EU rules, including budget contributions and the judicial oversight of the European court of justice in a transition period likely to follow departure in 2019 and before a free-trade pact can be finalised.

“The European council will monitor progress closely and determine when sufficient progress has been achieved to allow negotiations to proceed to the next phase,” the draft says.

If Britain remains a part of the EU single market for a time after Brexit, it would also have to respect all “four freedoms”, which would mean accepting free immigration from the continent, it says. “There can be no ‘cherrypicking’ nor any separate negotiations between individual states and the UK.”

Tusk rejected the description “Brexit bill” and said it was only fair that the UK paid what successive governments had signed up to. “It is only fair towards all those people, communities, scientists, farmers and so on to whom we, all the 28, promised and owe this money.”

“The talks will be difficult, complex and sometimes confrontational,” Tusk added. But he stressed “the EU will not pursue a punitive approach … Brexit itself is already punitive enough”.

Speaking alongside him, Joseph Muscat, the prime minister of Malta, said the negotiations would be tough, “but it will not be a war” and the two sides needed to remain friends.

On the future trade deal, the draft also makes clear the bloc’s objective will be to “preserve the integrity of the single market”. This “excludes participation based on a sector-by-sector approach”. “A non-member of the union … cannot have the same rights and enjoy the same benefits as a member,” the draft says.

Theresa May and Brexit ministers have said Britain aims to leave the single market and most of the European customs union in favour of agreeing a bespoke free-trade deal for individual industrial sectors, such as the automotive and pharmaceuticals industries.

Tusk’s message about an “orderly withdrawal” was repeated in a nine-page negotiating principles document sent to national capitals on Friday morning. A copy of the guidelines makes clear that the EU will oppose any attempts by the British government to start bilateral talks. “There will be no separate negotiations between individual member states and the United Kingdom,” it states.

One senior diplomat warned that any attempt to divide and rule was likely to backfire on the British. “It is not in the UK’s interest to have the 27 divided because then there might be no deal at all.”

A No 10 spokesman said: “These are draft guidelines and we look forward to beginning negotiations once they have been formally agreed by the 27 member states.

“It is clear both sides wish to approach these talks constructively, and as the prime minister said this week, wish to ensure a deep and special partnership between the UK and the European Union.”
Owen Smith, the former Labour leadership candidate, said Tusk’s statement already shows how May’s “lofty rhetoric is colliding with hard reality”.

“The prime minister’s plan for Britain is a pipedream,” he said. “The European council’s draft guidelines underline the difficulty the government will have in keeping its Brexit promises. The prime minister promised the exact same benefits on trade, but this has been explicitly ruled out today.
“Ministers and leave campaigners have presented Brexit as a cost-free option. It is not. There will be a cost to Brexit, we just do not know how deep it will be. It is time for the government to start levelling with the British people.”

Tim Farron, the Liberal Democrat leader, said the guidelines “show the strength of the EU in these negotiations, and the carelessness of the UK government in isolating themselves from our European allies”.

“The terms are clear: no sector by sector deals, no bilateral negotiations and no new trade deal until the withdrawal terms are agreed. This leaves no doubt that Davis’ comments about special arrangements for the car industry or financial sector are worthless.

“It is still possible for the British people to stop a hard Brexit and keep us in the single market. And if they want, it is still possible for the British people to choose to remain in the EU.”

Boris Johnson, the foreign secretary, said: “We really are moving forward now, and there’s a lot of goodwill, a lot of willingness to achieve what the prime minister has said she wants to achieve, which is an orderly transition and then a deep and special partnership between a strong EU and a strong UK.”

The guidelines states the UK will remain subject to EU institutions during any transitional period but hint at a face-saving solution for May, who has vowed the UK will leave the jurisdiction of the European court of justice, an institution that has long attracted the ire of Tory backbenchers.

Britain’s withdrawal agreement should be governed by “appropriate dispute settlement mechanisms… bearing in mind the role of the European court of justice” the draft states. The EU negotiating team, led by Michel Barnier, are looking at alternatives to the ECJ to govern any future trade deal, but are clear the UK will not escape the oversight of an independent judicial body.

The draft guidelines may well be revised over the next month. Tusk will chair a summit of the EU’s 27 prime ministers and presidents at the end of April to finalise the bloc’s negotiating position before talks with the UK begin.

When formal talks get underway - most likely in late May or early June - the EU plans to focus on three areas: the UK’s bills, EU citizens’ rights and the Irish border. In the draft text on what will be the UK’s only land border with the EU, the EU call for “flexible and imaginative solutions... with the aim of avoiding a hard border”

As the Guardian reported, Barnier hopes the main outlines of an agreement on these three areas will be clear by autumn, enabling the UK and the EU to reach a broad agreement at an EU summit in December. He has pencilled in January 2018 as the point where he hopes to start talks with the British on a future relationship.

But there are lingering fears the talks could collapse. The EU wants an agreement, the draft text says, “but it will prepare itself to be able to handle the situation also if the negotiations were to fail.”


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