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0 Michel Barnier says EU law will apply for the transition including any changes that were agreed during that period, as Britain would continue to enjoy the full economic benefits of EU membership.

Speaking in Brussels after EU foreign ministers formally adopted the guidelines for negotiations on a transition agreement lasting from March 2019 to the end of December 2020, he said: “During that period the decisions will apply and the UK must acknowledge and accept these rules of the game from the outset.”

Mr Barnier insisted that Britain could not have a la carte access to the single market.

“During transition the UK will continue to take part in the single market, to take part in the customs union,” he said.

“It will continue to have all the economic benefits therefore it must also apply all the EU rules. The single market cannot be a la carte.” Speaking ahead of the publication of Mr Barnier’s new mandate, Downing Street acknowledged that “differences” remain between the views of London and Brussels on the nature of the transition, expected to last about two years from the official date of Brexit in March 2019.

Responding to the EU27’S guidelines, Theresa May’s official spokesman said: “We are pleased that the EU has now agreed its position, which is clearly well aligned with the proposal made by the Prime Minister in her Florence speech and which David Davis set out in more detail last Friday.

“But this will be a negotiation and there will naturally be some distance between the detail of our starting positions.”