Theresa May today hailed the agreement by Brussels of a Brexit transition deal and the formal start of UK-EU trade talks.
The Prime Minister urged EU leaders to press on with a deal that worked for both sides after Brexit as she left Brussels following the latest leaders' summit.
A transition deal was announced earlier this week and Mrs May said it had been adopted by the EU-27 in Brussels this morning.
The deal effectively keeps everything the same from Brexit day on March 29, 2019, until the end of 2020 - when the final settlement is due to come into force.
It means free movement will continue from the EU into Britain - though arrivals will now have to register - companies can continue to trade on existing rules, and new EU laws can be imposed in Britain.
EU Council President Donald Tusk announced today the remaining 27 leaders had signed off on negotiating guidelines for the trade talks phase.
At a press conference to close the summit, Mr Tusk praised 'positive momentum' in the talks but warned EU leaders would assess progress on Ireland in June.
The new guidelines are unchanged from a draft published earlier this week. They call for a future relationship that is 'as close as possible' but warns the EU is determined to protect its institutions, including the single market.
Theresa May (pictured in Brussels this morning) will leave an EU summit later to allow the remaining EU members to sign off on the Brexit transition deal with Britain
At a press conference to close the summit (pictured), Donald Tusk praised 'positive momentum' in the talks but warned EU leaders would assess progress on Ireland in June
European Commission President Jean-Claude Juncker (pictured in Brussels today) has also signed up to the Brexit transition deal
EU leaders resumed their summit in Brussels today (pictured) with discussions covering a trade war with America and Brexit
In his press conference to end the summit, Mr Tusk said: 'We want to use the positive momentum in the negotiations to finally settle outstanding issues, such as a solution to avoid a hard border between Ireland and Northern Ireland.
'In parallel, we will start our first talks about the future EU/UK relationship.
'Leaders will assess in June if the Irish question has been resolved and how to go about a common declaration on our future.'
As she headed home today, Mrs May said: 'I welcome the fact that the EU Council this morning has agreed the details of the implementation period.
'This gives certainty to people and businesses, it gives them the clarity to plan for their future and it ensures that they will only have to make one adjustment, one change when we enter into the new relationship with the EU.
'I believe there's a new dynamic now in the negotiations, I believe we are approaching this with a spirit of cooperation, and spirit of opportunity for the future as well.
'We will now be sitting down and determining those workable solutions for Northern Ireland but also for our future security partnership and economic partnership.'
Shadow Brexit Secretary Sire Keir Starmer welcomed progress.
He said: 'Today's agreement is a step in the right direction but we are still a very long way away from both sides reaching an agreement on what the future relationship will look like.
'Theresa May must now finally drop her reckless red lines and take the action needed to protect jobs, the economy and avoid a hard border in Northern Ireland.'
Despite the agreements, Brexiteers warned today it would be 'folly' for Britain to abandon preparations for a no deal Brexit.
Jacob Rees-Mogg, the Brexiteer ring leader on the Tory backbenches, said Britain must be prepared to walk away from talks until a trade deal was finalised.
Mrs May was greeted with a kiss on the hand by EU negotiator Michel Barnier as she made a surprise return to a summit in Brussels this morning.
The Prime Minister has now left the summit as planned following EU-wide talks on Donald Trump's US steel tariffs. The EU Brexit discussion will then take place.
Mr Rees-Mogg, chairman of the Tory European Research Group, said abandoning no-deal preparations would be 'folly'.
He told Politico: 'If we were ready [to walk away with no deal] the EU would not be, as it has made no plans to cut spending in the beneficiary states or raise revenue from the other net contributors.
'That would leave us in a very strong negotiating position.'
Last night Mrs May told EU leaders it is their duty to show 'energy and ambition' in negotiating a post-Brexit trade relationship which will be good for both Britain and Europe.
Addressing fellow leaders over dinner on Thursday Mrs May said that 'compromise on both sides' had been required to reach a mutually acceptable legal text on the transition.
Britain believes that moving on to trade talks with the EU will help unblock the logjam over the Irish border and prevent the need to implement a 'backstop' solution proposed by Brussels which would keep Northern Ireland in the Customs Union.
Theresa May (pictured in Brussels today with the UK's EU ambassador Tim Barrow ) hailed the 'spirit of opportunity' which has seen the EU sign up to the deal
Mrs May was greeted with a kiss on the hand by EU negotiator Michel Barnier as she made a surprise return to a summit in Brussels this morning (pictured)
Last night Mrs May told EU leaders it is their duty to show 'energy and ambition' in negotiating a post-Brexit trade relationship which will be good for both Britain and Europe (pictured arriving in Brussels with aides including ambassador Sir Tim Barrow, right, today)
London is hopeful that a solution to keep Northern Ireland's border with the Republic open will emerge in the context of a deal allowing trade between Britain and the rest of the EU to be as frictionless as possible.
Mrs May told the EU27 leaders: 'We have the chance now to create a new dynamic in the talks, to work together to explore workable solutions on Northern Ireland, on our future security co-operation and in order to ensure the future prosperity of all our people.
'This is an opportunity it is our duty to take and to enter into with energy and ambition.'
Irish Taioseach Leo Varadkar played down suggestions that he wanted the border issue settled by the summer.
'Would I like to have it done by June? Yes, absolutely,' he said. 'But I would rather have the right deal in October rather than any deal in June.'
Mr Varadkar said he envisaged a trading relationship between the UK and the EU, 'so close that many of the measures in the backstop may become unnecessary'.
Arriving at the summit venue earlier, Mrs May said: 'I am looking for a new dynamic in the next stage of negotiations, so that we can ensure that we work together to negotiate and develop that strong future economic and security partnership which I believe is in the interests of the UK and the EU.'
What is in the EU Council's new negotiating rules on trade talks?
The EU Council today adopted negotiating guidelines ahead of planned formal trade talks. It says:
- The EU wants tariff free trade with Britain after Brexit.
- But it warns Britain cannot have 'partial participation' in the EU single market to achieve this. Services - crucial to the UK - will only be included with restrictions.
- The document sets out a willingness on the EU side to let Britain stay inside the Single Market and Customs Union if Theresa May dropped her red lines on the issue.
- There is common ground on a close defence, security and policing partnership.
- The EU wants a deal on aviation to keep planes flying after Brexit
Mrs May was greeted by other EU leaders during the emergency trade discussion today, including Lithuanian President Dalia Grybauskaite (pictured)
Mr Barnier, who kissed Mrs May's hand as they met in the entrance lobby of the Europa building in Brussels, said Friday marked a 'decisive' moment in 'this difficult and extraordinary negotiation'.
He cautioned that the future partnership negotiated over the coming months 'must respect the principles and identity of the EU and the single market'.
Addressing fellow leaders over dinner on Thursday, Mrs May said 'compromise on both sides' had been required to reach a mutually acceptable legal text on the transition.
It will see the UK continue to observe EU rules until the end of 2020 while winning the freedom to negotiate and ratify trade deals with outside countries.
Britain believes that moving on to trade talks with the EU will help unblock the logjam over the Irish border and prevent the need to implement a 'backstop' solution proposed by Brussels which would keep Northern Ireland in the customs union.
London is hopeful that a solution to keep Northern Ireland's border with the Republic open will emerge in the context of a deal allowing trade between Britain and the rest of the EU to be as frictionless as possible.
Irish Taioseach Leo Varadkar (pictured on Wednesday with German Chancellor Angela Merkel) last night played down suggestions that he wanted the border issue settled by the summer
Jacob Rees-Mogg (pictured in London on Wednesday), the Brexiteer ring leader on the Tory backbenches, said Britain must be prepared to walk away from talks until a trade deal was finalised
Theresa May and Jean-Claude Juncker agreed the outline of a divorce deal in December
Theresa May and the EU effectively fudged the Irish border issue in the Brexit divorce deal before Christmas.
But the commitments to leave the EU customs union, keep a soft border, and avoid divisions within the UK were always going to need reconciling at some stage. Currently 110million journeys take place across the border every year.
All sides in the negotiations insist they want to avoid a hard border between Northern Ireland and the Republic, but their ideas for how the issues should be solved are very different.
If they fail to strike a deal it could mean a hard border on the island - which could potentially put the Good Friday Agreement at risk.
The agreement - struck in 1998 after years of tense negotiations and a series of failed ceasefires - brought to an end decades of the Troubles.
More than 3,500 people died in the 'low level war' that saw British Army checkpoints manning the border between Northern Ireland and Ireland.
Both London and Dublin fear reinstalling a hard border - whether by checkpoints or other means - would raise tensions and provoke a renewal of extremism or even violence if people and goods were not able to freely cross.
The DUP - which opposed the Good Friday Agreement - is determined to maintain Northern Ireland inside the UK at all costs, while also insisting it wants an open border.
The UK blueprint:
The PM has made clear her favoured outcome for Brexit is a deep free trade deal with the EU.
This would mean being aligned closely enough with the bloc that there is no need for customs checks.
Any remaining gaps in customs regulations as a would be covered with technological solutions.
That is likely to mean cameras and electronic records, which would arguably not constitute major physical infrastructure.
Boris Johnson has suggested that a slightly 'harder' border might be acceptable, as long as it was invisible and did not inhibit flow of people and goods.
However, Brussels has dismissed these ideas as 'Narnia' - insisting no-one has shown how they can work with the UK outside an EU customs union.
The EU blueprint:
The divorce deal set out a 'fallback' option under which the UK would maintain 'full alignment' with enough rules of the customs union and single market to prevent a hard border and protect the Good Friday Agreement.
The inclusion of this clause, at the demand of Ireland, almost wrecked the deal until Mrs May added a commitment that there would also be full alignment between Northern Ireland and the rest of the UK.
But the EU has now translated this option into a legal text - and hardened it further to make clear Northern Ireland would be fully within the EU customs union.
Mrs May says no Prime Minister could ever agree to such terms, as they would undermine the constitutional integrity of the UK.
A hard border:
Neither side wants a hard border between Northern Ireland and the Republic.
But they appear to be locked in a cyclical dispute, with each adamant the other's solutions are impossible to accept.
If there is no deal and the UK and EU reverts to basic World Trade Organisation (WTO) relationship, theoretically there would need to be physical border posts with customs checks on vehicles and goods.
That could prove catastrophic for the Good Friday Agreement, with fears terrorists would resurface and the cycle of violence escalate.
Many Brexiteers have suggested Britain could simply refuse to erect a hard border - and dare the EU to put up their own fences.
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