No discussion on future UK-EU status until ‘sufficient’ exit talks progress - Tusk

31 March 2017 13:14 Source:ICIS News

Donald Tusk holding UK article 50 letter (source: Xinhua News Agency/REX/Shutterstock)

LONDON (ICIS)--European Council President Donald Tusk on Friday rebuffed overtures by UK premier Theresa May to hold simultaneous talks on the country’s exit and future relationship with the EU.

In a letter outlining the European Commission’s guidelines for the UK’s exit negotiations with the EU, Tusk stated that talks on the country’s future relationship with the trade bloc can only begin once discussions on exit terms have advanced sufficiently.

“The European Council will monitor progress closely and determine when sufficient progress has been achieved to allow negotiations to proceed to the next phase,” Tusk said.

“An agreement on a future relationship between the Union and the UK as such can only be concluded once the UK has become a third country,” he added.

However, Tusk noted that the terms of Article 50 – the EU exit clause set in motion by the UK on 29 March – require the framework of the EU’s future relationship with the UK to be taken into account in the withdrawal agreement, leaving the door open for future talks to begin before the formal conclusion of exit discussions.

The Commission underlined that there is no scope for the UK to negotiate with any EU member states as individual entities on any matters of trade.

A key worry for industrial producers in the UK and Europe has been a period of uncertainty between the country’s exit from the bloc on 29 March 2019 and the ratification of any new trade arrangements.

Tusk stressed in the guidelines that both sides should strive to avoid a period of “legal vacuum" to mitigate the impact on importers and exporters to and from the EU, and parties that may have signed contracts on the understanding of the UK as an EU member state.

The Commission also stressed that all efforts should be taken to avoid a hard border between the Republic of Ireland and the UK’s Northern Ireland, set to represent the only land border between the UK and the EU post-exit.

Existing arrangements between the UK and Ireland would also be respected if they are compliant with EU law, Tusk added.

The Commission also continued to assert its right to a separation payment from the UK, estimated at up to €60bn, to cover legal and budgetary commitments.

“A single financial settlement should ensure that the Union and the UK both respect the obligations undertaken before the date of withdrawal,” Tusk said.

In her letter to Tusk notifying the EU Commission of the UK’s initiation of Article 50, May reiterated her desire for a “deep and special partnership” between the UK and EU, wherein the UK would opt out of membership of bloc’s single market but retain favourable trading terms without requiring observance of the European Court of Justice.

European chemical stocks received the news with falls.

Tusk stated that the Council is receptive to the idea of a free trade agreement, but that any kind of ‘a la carte’ deal that maintains existing trade relationships and while allowing the UK to opt out of immigration and European court rules will not be allowed to stand.

"Any free trade agreement should be balanced, ambitious and wide-ranging. It cannot, however, amount to participation in the Single Market or parts thereof,” he said.

(Pictured: EU Council's President Donald Tusk holding the letter from Theresa May notifying him of the UK's activation of Article 50 on March 29. Source: Xinhua/REX/Shutterstock)

Focus article by Tom Brown

By Tom Brown