23 Nov 2018

Brexit: Britain and EU agree draft deal on future relations

12:21 pm on 23 November 2018

Britain and the European Union have agreed on a draft text setting out a close post-Brexit relationship, though wrangling with Spain over control of Gibraltar must still be settled before EU leaders meet on Sunday.

The British Prime Minister briefly escaped the Westminster bear pit to bring her Brexit battle to Brussels, just four days before the divorce deal is to be signed.

EU Commission President Jean-Claude Junker and Theresa May during a meeting at the EU headquarters in Brussels on 21 November. Photo: AFP

Britain is due to leave the EU on 29 March 2019 and diplomats are trying to put the finishing touches to a Brexit deal, which European Council President Donald Tusk said had now been agreed to in principle.

The news sent the pound nearly one percent higher on relief among investors that 18 months of tense and tortuous negotiation were bearing fruit, keeping Britain close to its biggest market and ensuring nothing much will change during a transition period due to last until at least the end of 2020

"The British people want Brexit to be settled. They want a good deal that sets us on a course for a brighter future," British Prime Minister Theresa May told the House of Commons.

Mrs May now faces a difficult vote in a deeply-divided parliament, with hardline Eurosceptic and staunch pro-EU factions, and various shades of grey in-between.

Theresa May's Cabinet agreed on the country's vision for its future relationship with the EU. But it has already led to a flurry of resignations.

Some fellow Conservatives seeking a cleaner break from the EU accused her of "betraying Brexit" while opposition Labour leader Jeremy Corbyn called the outcome of the negotiations "the worst of all worlds" for keeping Britain linked to the vast EU market but without a say in its rules.

The text of the draft deal said the EU and Britain "agree to develop an ambitious, wide-ranging and balanced economic partnership".

"This partnership will be comprehensive, encompassing a free trade area as well as wider sectoral cooperation … will be underpinned by provisions ensuring a level playing field."

Both sides need an agreement to keep trade flowing between the world's biggest trading bloc and the fifth-largest national economy.

But Mrs May has struggled to untangle nearly 46 years of membership without damaging trade or upsetting the politicians who will ultimately decide the fate of any deals she can secure.

EU officials said there was a solid consensus that remaining niggles should not hold up a final deal for Sunday, as the other 27 governments go through the new paperwork.

The main question mark is whether Spain, seeing Brexit as an opportunity to swing the EU's weight behind its 300-year campaign to reclaim Gibraltar from Britain, can be persuaded to remain patient.

Both the EU and Britain reiterated they wanted to replace a provisional agreement preventing the return of extensive border checks on the island of Ireland with a permanent solution.

The two sides "should aim to deliver a level of liberalisation in trade in services well beyond the parties' commitments," according to the draft declaration.

The proposed transition period following Brexit could be extended "for up to one or two years", according to the draft declaration.

Here are key elements of a 26-page Political Declaration on EU-UK ties after Brexit, due to be approved by leaders on Sunday.

Data protection

  • Both commit to accept each other's data protection standards before transition ends in 2020 so as to maintain free data flow.

EU programmes

  • Britain should be able to pay to take part in EU science, education, culture, defence and space programmes. The EU will look at its call to work with the European Investment Bank.


  • Customs procedures are inevitable but "comprehensive arrangements ... will create a free trade area, combining deep regulatory and customs cooperation, underpinned by provisions ensuring a level playing field for open and fair competition."
  • This language echoes British calls for open borders but also EU insistence that nothing can be as smooth as EU membership.
  • "The Parties recall their determination to replace the backstop solution on Northern Ireland by a subsequent agreement that establishes alternative arrangements."
  • "Facilitative arrangements and technologies" to be looked at to avoid a "hard border" between Ireland and Northern Ireland.
  • No tariffs or quotas and "ambitious customs arrangements" to build on initial plan for Britain to stay in the EU customs union, which avoids the need to check where goods were made.
  • "Liberalisation in trade in services well beyond the Parties' World Trade Organization (WTO) commitments and building on recent Union Free Trade Agreements (FTAs)."
  • Equivalence arrangements for financial services regulation.
  • Fair and equal access to each other's telecoms networks.
  • Free movement of capital and payments.
  • As Britain ends free movement for EU citizens, mobility to be regulated on reciprocal basis, with possibilities for easy border crossing, social security and family law coordination.


  • Plan for a deep accord on air passengers and cargo, comparable market access for road transport operators.


  • Considering cooperation on carbon pricing by linking a UK emissions trading system with the EU's ETS.


  • Plan for a new fisheries agreement on access to waters and quota shares by July 2020.

A level-playing field

  • "Provisions to ensure this should cover state aid, competition, social and employment standards, environmental standards, climate change, and relevant tax matters."

Transition period

  • Separately, EU and UK would agree that the post-Brexit transition period could be extended once "for up to one or two years" and Britain would have to go on contributing to the bloc's budget accordingly.
  • The text also makes clear that Britain could choose to prolong its post-Brexit adaptation by any number of months within the two-year limit, not just by 12 or 24 months.


  • EU, UK want "broad, comprehensive and balanced security partnership".
  • EU states and Britain will remain solely responsible for their own national security.

- Reuters

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