The UK and EU governments are upbeat that a Brexit deal can be done in the next few weeks. But the European Commission is more hesitant, with talks on the Irish border still ongoing.
A Commission spokesperson this week corrected press reports that a deal was "within reach". The reports were the result of an apparent misinterpretation of remarks by EU lead negotiator Michel Barnier, who said (in the original French) that the "objective" was to have a deal "within reach" by next week’s summit. And migration commissioner Dimitris Avramopoulos said, after the Commission was briefed by Barnier on Wednesday, that a deal was "not there yet".
Barnier estimates that 80-85% of the withdrawal treaty is complete. The three most contentious issues – Ireland, governance and geographical indications – all remain to be solved.
They don’t need to be solved by the summit, and EU diplomats are sceptical that they will be. But EU leaders need to see what they describe as "decisive" progress next week if a deal is to be done at a special summit in November.
As in December, the biggest problem is how to ensure the Irish border remains open and free of infrastructure post-Brexit.
Last February the EU proposed a 'backstop' for Northern Ireland that would kick in if a trade deal is not done by 2020. A June counter-proposal by the UK was rejected by the EU because it was time-limited and UK-wide (rather than permanent and Northern Ireland-specific).
But the EU now appears ready to allow for a UK-wide customs arrangement, as long as there is no end date (more on this below), and as long as the UK agrees to extra health and safety checks on goods travelling from Great Britain to Northern Ireland.
Barnier outlined the compromise in his speech to business leaders at the European Parliament on Wednesday: customs declarations can be filled out online, in advance, and any extra customs and regulatory checks can be carried out on ferries, at ports or in factories in Northern Ireland (see EUROPE 12115).
The EU’s strategy to help sell the backstop is to stress that it will never need to be used (and to tweak the language so it appears less permanent – more on this below).
"Our proposal is just a safety net, a 'backstop'", Barnier said on Wednesday. "But the future relationship in itself might mitigate the necessary checks, or even make some unnecessary".
Two EU sources told The B-Word that the bloc might even agree to extend the transition period to allow for more time to negotiate a trade deal (and therefore avoid the backstop kicking in).
However, the Democratic Unionist Party (DUP) and hardline Brexiteers are unwilling to sign up to anything that divides Northern Ireland from the rest of the UK, or which keeps the UK tied to EU customs rules indefinitely. After a series of meetings in Brussels this week (see EUROPE 12113), the DUP said it was ready to collapse its support for Theresa May’s minority government if she signs up to the backstop.
The trick will be to tweak the language in the final withdrawal agreement to give May scope to sell the backstop as time-limited (a review clause, for instance) and reassure EU countries (especially France and Germany) that it will not grant the UK single market access by the back door.
The Commission is also weighing whether and when to publish its updated contingency plan for a no-deal Brexit and its draft declaration on the future relationship.
The contingency plan, according to sources, will outline EU legislation needed to keep transport, banking, customs and data flowing smoothly from April next year.
The draft political declaration, which will run to between 15 and 20 pages, will contain the basics of a free trade deal and agreements on security, data protection and other priority areas – building on EU leaders’ conclusions from last March (see EUROPE 11988).
Technical talks continue in Brussels on the withdrawal agreement, with prime ministers’ advisors (sherpas) due to meet on Monday, followed by Europe ministers on Tuesday in Luxembourg, to prepare the summit talks which take place at a dinner on Wednesday evening. (Sarah Collins)