Brexit negotiations are deadlocked ahead of a crucial EU summit, with leaders now weighing up whether to open the door to transition and trade talks with the UK, or play hardball.
Draft summit conclusions ask EU negotiator, Michel Barnier, to start “internal preparatory discussions” on transition and trade, but don’t allow for talks with the UK. The text says talks on citizens’ rights, money and Ireland - the EU’s three divorce priorities - should continue, with leaders to “reassess” progress in December.
After a fifth round of Brexit talks this week made virtually no progress on any of the three priorities (see EUROPE 11882), Mr Barnier said the main “deadlock” was over money. While he said there was “no question of making concessions”, he offered some hope a deal could be done - “with the necessary will”.
But European Commission president, Jean-Claude Juncker, on Friday slapped down UK hopes of a quick deal, saying, the “process will take longer than initially thought”. “We had the idea we would clear all the questions related to the divorce - it’s not possible,” Mr Juncker said, saying the UK would “have to pay” its EU debts and stop what he called “nonsense” on citizens’ rights.
“I am not in a revenge mood, I’m not hating the British,” Mr Juncker said. “Europeans have to be grateful for so many things that Britain has brought to Europe, during war, after war, before, everywhere and every time. But now they have to pay.”
The comments follow British prime minister Theresa May’s challenge earlier in the week that the “ball is in the court” of EU leaders (see EUROPE 11879). British officials say Mrs May’s Florence speech - in which she said she would cover UK debts up to 2020 and “honour commitments” made during membership (see EUROPE 11868) - is as far as she can go without a further signal on transition and trade.
It is these further financial commitments - to long-term EU infrastructure projects like Galileo satellites, which go beyond 2020 - that the EU wants locked down. But according to sources familiar with UK government thinking, the summit conclusions as they stand do not give Mrs May the right signal to make a move on money.
With the word games showing no signs of abating, speculation is growing about the possibility of no deal, with UK chancellor, Philip Hammond, forced to acknowledge this week that he would put aside Brexit contingency funding. Even the EU is playing the brinkmanship game. “No deal will be a very bad deal and, to be clear, on our side we will be ready to face any eventualities and all the eventualities,” Mr Barnier said on Thursday.
But there is still hope that something can be salvaged from the EU leaders’ summit on 19-20 October, with leaders weighing up how to send a positive signal to Mrs May.
The draft summit conclusions welcome “progress” on citizens’ rights, though questions remain over family reunification, migrant registration, social security payments and EU court jurisdiction. And the draft “acknowledges… some progress” on the Irish border, though the Commission and the Irish government are adamant that much more needs to be done to get a deal over the line.
The views on money are more hard line particularly in Germany, France, the Netherlands, Denmark and net recipients of EU funds such as Poland, Hungary, Slovakia and the Czech Republic. The draft conclusions say that Mrs May’s Florence speech needs to be “translated into a firm and concrete commitment from the UK to settle all of these obligations”.
"I feel some substantial concern about the UK government still not taking its obligation to fulfil its financial commitments seriously,” said German EPP MEP Elmar Brok. “If sufficient progress is not made in November, it will not be possible to start the second phase of the negotiations at the European Council meeting in December either,” he said.
While the EU remains firmly united on the fact that all three divorce issues - citizens, Ireland and money - need to be solved before moving talks on to the future, there are more “nuanced” views on whether they should empower Mr Barnier to talk transition, sources said. In any case, EU governments need time to work up a common position and new guidelines on transition before they begin talks with the UK.
Until then, it looks like the Brexit ball will continue to be bounced back and forth. Next stop: the General Affairs Council taking place on 17 October in Luxembourg, two days before the leaders’ summit (see other news). (Sarah Collins)