Brexit political declaration fails to offer 'frictionless trade'

Brexit political declaration fails to offer 'frictionless trade'

Leaked statement falls short of Theresa May’s Chequers plan, saying there will be inevitable trade barriers

Leaked statement falls short of Theresa May’s Chequers plan, saying there will be inevitable trade barriers

A joint document on Britain’s post-Brexit relationship with the EU fails to give hope of frictionless trade said to be vital to the British economy, but offers Theresa May arguments to bolster her hopes of selling the deal to the Brexiters in parliament.

A leaked 26-page political declaration, to be approved by EU leaders at a Brexit summit on Sunday, paints a picture of the future relationship which is far from the Chequers proposals made by the prime minister in the summer.

May is due to give a statement to the House of Commons at 2.30pm UK time.

The two sides “envisage having a trading relationship on goods that is as close as possible”, but the EU and the UK will be separate markets with inevitable barriers to trade, and there is no reference to a common rulebook.

The document does reassert the plan for both sides to “build and improve on the single customs territory” already negotiated in the withdrawal agreement.

The UK has accepted in the withdrawal agreement already approved by both sides that the country will stay in a customs union with the EU should a trade deal that can avoid a hard border on the island of Ireland not be ready to come into force by the end of the transition period.

The text reiterates the long-standing EU red line that British access to European markets will only be offered on the basis of “open and fair competition”. To gain a close economic relationship, the UK would have to respect EU standards on competition, tax, environment, as well as social and employment protection.

But in a major sop to the Brexiters in her party, the prime minister has successfully argued for the inclusion of language that she might use to convince her critics that the customs union backstop may not be the only solution in the long term.

The document claims that “facilitative arrangements and technologies will also be considered in developing any alternative arrangements for ensuring the absence of a hard border on the island of Ireland on a permanent footing”.

The pro-Brexit European Research Group, chaired by Jacob Rees-Mogg, has expressed its vehement opposition to a customs union, and lobbied hard for such an alternative plan to avoiding a customs border being drawn in the Irish Sea.

The document also commits both sides to coming to an agreement six months before the end of the 21-month transition period after Brexit on a fisheries deal on “access to waters and quota shares”.

France was particularly keen for the political declaration to link the UK’s willingness to stay close to the current arrangement with the bloc’s opening up of its markets to British exports.

The draft text outlines the basis for future relations between the UK and EU, spanning the economy, security, foreign policy and how to manage possible disputes.

Trade talks, which have been billed by the Brexit-supporting trade secretary, Liam Fox, as “the easiest in human history” are due to begin in April 2019, after the UK has left the EU.

In the text, both sides agree to start formal negotiations “as soon as possible” after the UK leaves the EU on 29 March 2019, with the aim of having a deal enter into force by the end of 2020.

The timing sets the bar high, suggesting that negotiators on both sides are confident they can strike a deal far more quickly than the seven-year EU-Canada talks, which are often given as a benchmark. It also shows both sides want to avoid the controversial Irish backstop, as well as an extended transition that would leave the UK following EU rules without any say.

The two sides would meet through “a high-level conference” every six months to assess progress. In a win for May, the document proposes regular EU-UK summits, one of the prime minister’s Chequers proposals.

Daniel Boffey and Jennifer Rankin

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