EU leaders have categorically ruled out key elements of Theresa May’s chequers proposal stating they undermine the single market and that her proposals on the Irish Border were unworkable.
The Chequers plan would see the UK remain in the single market for goods but not services. The EU state that this is not possible.
The EU and UK also differ on a customs backstop. However to maintain the Good Friday Agreement the EU want a customs border in the Irish Sea, something that May is not willing to do as dividing up the UK is not acceptable as it would mean Northern Ireland would remain inside the EU customs union if no deal was reached.
May now may offer a regulatory border in the Irish Sea as a compromise with the EU. May will need to make progress before October so that the UK can get a deal within the next 2 months.
Tusk said that the Ocotber summit would be “moment of truth” for EU leaders as they will decide whether enough progress has been made to strike a deal in November. However Tusk was ‘little bit more optimistic’ than he was about securing a deal.
Tusk says he will call an emergency summit in November to get a deal if in October, he believes there is enough progress to justify one.
Jean-Claude Juncker, the European commission president, says he would like a deal by October but says he is prepared for a no deal. Saying: So don’t worry: “Be happy, don’t worry.”
Andrea Merkel. commenting on the Chequers proposal said:
There is still much work to be done on the future trade relations after Brexit. There are still a number of… issues, e.g. on the future trading relationship. Here we all agreed that there can be no compromises on the matter of the [EU] Single Market.
Commenting on the problem of the Irish Border Leo Varadkar, the Irish prime minister stated:
Nobody is trying to dispute the constitutional status of Northern Ireland. We need to get away from the idea of anyone trying to create a border between Northern Ireland and Great Britain. That’s not the EU’s objective.
These defeats came just hours after a key ally of Theresa May said that her proposals for Brexit will not get through parliament and are “dead as a dodo”. Parliament had previosly ruled out various arrangments that might solve the Irish Border problem but the Lords are expected to send these back to the Commons. This could allow the EU’s preffered customs backstop or Labour’s custom union plan.
May once again ruled out a 2nd referendum during her press conference.
President Macron in comments today called leading Brexiteers “liars” though he did not name any specifically. In a press conference Macron stated:
Those who explain that we can easily live without Europe, that everything is going to be alright, and that it’s going to bring a lot of money home are liars. It’s even more true since they left the day after so as not to have to deal with it.
Analysis from Iwan Doherty- Editor in Chief
Chequers is dead, that has been clear to most people, except May, for some time now. May and her allies did not realise one key detail when trying to deliver Brexit. The EU do not negotiate. They simply don’t need to, and May is finding this out the hard way with little time to spare. The Prime Minister hoped Tusk would give her breather but the member states have rejected her 2 key proposals and given her a 4 week deadline to come up with an alternative. Overall a terrible day for the PM who is now caught back peddling from the EU but may find herself colliding with the ERG group in Parliament.
The defeat leaves May with 3 options. Going from Hard to soft the options are: Canada Style FTA, ERG backed, Customs border in the Irish Sea and drop Free movement of Goods for FTA, EU backed, or negotiate customs unions, Labour backed.
The Canada Style deal would violate the Good Friday Agreement, so isn’t workable as even if the EU negotiators went for it Ireland would VETO it.
The Customs Border in the Irish Sea is opposed by the DUP.
The Customs Union option gives all the benefits on trade and solving the Irish border problem that May’s plan does but is accepted by the EU. I have written the full details on this proposal here.
All of these proposals have problems back home as well, and a No Deal would be both economically disatrous and tricky to get through Parliament. Voters might have to go back to the polling station to cast a votes, either in a referedum or a general election.