May draws up plans for no deal on Brexit

PM heaps pressure on EU to begin trade talks by setting out her future for Britain

THERESA MAY has revealed detailed plans for quitting the EU with “no deal” in a move designed to pile pressure on Brussels to begin trade talks.

The Prime Minister decided to “focus minds” by publishing draft legislation showing how the UK will implement independent trade and customs arrangements from “day one” after Brexit in March 2019.

It is the first time the Government has set out what “no deal” would look like, and is aimed at kick-starting Brexit talks that have stalled because of a row over the size of the so-called “divorce bill”.

Draft legislation published yesterday on customs and trade made it clear that Britain would trade under World Trade Organisation rules if it left without a deal, and would set its own tariffs and taxes on goods, as well as moving borders “inland” to avoid queues at ports.

It also emerged that the Department for International Trade has set up a planning unit dubbed “Project After” which is putting forward radical options including dropping all trade tariffs and joining a trade pact focussed on Asia.

Mrs May sent a clear message to Brussels when she told MPS: “We are planning for every eventuality and you are now seeing the proof of it.”

The Prime Minister toughened her stance ahead of a visit to Brussels next week when she will attend a meeting of the European Council which will decide whether or not sufficient progress has been made on the issues of money, citizens’ rights and the Irish border to allow trade talks to begin.

David Davis will join the latest round of Brexit talks today, but the Government has all but conceded that the EU will say no to trade talks at this stage. Mrs May – who told the EU at the weekend that “the ball is in their court” – hopes her latest move will persuade the EU that Britain is serious about walking away from the negotiating table if they are not more flexible.

The draft legislation sets in motion laws that will define what Britain’s customs and trading relationship with the EU may look like after the 2019 Brexit date. The White Paper on customs says that while the UK “hopes and expects” to reach a deal on Brexit, ministers have drawn up plans for a “contingency scenario”. It warns that the impact of leaving the EU without a deal is likely to be “greatest” at ferry ports.

Mrs May is ready to commit billions of pounds to building the infrastructure needed for a no-deal scenario if no progress is made by the New Year.

A Whitehall source said: “Hopefully this will focus minds in Brussels. They will be able to see that we will be ready on day one after we leave the EU in March 2019.”

Mrs May’s row with Brussels intensified yesterday with sources close to Michel Barnier, the European chief negotiator for Brexit, telling The Daily Telegraph that even if full agreement were reached on Ireland and citizens’ rights, “two out of three isn’t good enough” and trade talks would only proceed if agreement came on the financial settlement. Asked if the ball was now in the EU’S court, Margaritis Schinas, the European Commission chief spokesman said: “There is a clear sequencing to these talks, there has been no solution found on step one, the divorce proceedings. The ball is entirely in the UK’S court.”

THERESA MAY has announced that Britain will still be bound by the rulings of the European Court of Justice during a transition period after Brexit, prompting a backlash from Eurosceptic Tory MPS.

The Prime Minister conceded that the European Court of Justice may still “govern the rules we are part of” for a period after the UK formally leaves the European Union in March 2019.

She also suggested that the UK could have to accept new EU laws and regulations during the transition period, although she said it was “highly unlikely”.

Her comments appeared to cross one of the four Brexit red lines that Boris Johnson, the Foreign Secretary, set out on the eve of the Conservative Party conference.

However, despite mounting criticism of the Prime Minister’s position from Eurosceptic MPS Mr Johnson last night praised her “great statement”. It comes after the Foreign Secretary was accused by the Prime Minister of disloyalty for his interventions on Brexit.

Michael Gove, the Environment Secretary, also urged his colleagues to be “pragmatic” about the implementation period and focus on the “end state”.

Bernard Jenkin, a leading Eurosceptic Tory MP, told The Daily Telegraph: “Most MPS represent Leave constituencies, and they may find it hard to explain why we are not taking back control of our laws on day one.”

Jacob Rees-mogg, another Eurosceptic Tory MP, said: “It has always seemed to me absolutely essential that when we leave the EU we leave the jurisdiction of the ECJ. Any suggestion that we are still under that jurisdiction means we haven’t left the European

Union. I am concerned.”

Mrs May told MPS in the Commons that Britain may “start off ” a Brexit implementation period under the jurisdiction of the EU until it can implement a “dispute resolution mechanism”.

She said: “That may mean that we will start off with the European Court of Justice still governing the rules we are part of during that period. But we are also clear that we can bring forward discussions and agreements on issues like a dispute resolution mechanism.”

She also conceded that the UK could accept some new EU laws during the transition, but said that they take so long to implement it is “highly unlikely” that they will come into force.

Mr Johnson said in a statement: “Yes we will have a transition period but... the chances of new EU regulations in that period are very small. And yes we will mostly have to operate under existing

‘We will have a transition period but the chances of new EU regulations in that period are very small’

rules during the transition but we will be able to negotiate proper free trade deals and business will be able to prepare properly for Brexit.

“What matters is the end state and our freedom to do things differently and better – and once again the PM sets out a powerful vision: out of customs union, out of Single Market, taking back full control. She has reaffirmed the destination of a self-governing, free-trading, buccaneering and Global Britain taking back control over our laws, money, and borders. The future is bright. Let’s keep calm and carry on leaving the EU.”

Mr Gove added: “Strong statement from [the Prime Minister] on Brexit – let’s be pragmatic over implementation to secure maximum freedom to diverge from EU in end state.”