UK prime minister proposes two-year transition post-Brexit
UK Prime Minister Theresa May proposed on Friday a two-year transition – or "implementation" – period for the country after it leaves the European Union (EU) in March 2019, during which it will still adhere to the bloc's rules and regulations.
Britons voted in a referendum on June 23, 2016, to leave the EU. May triggered Article 50 of the Lisbon Treaty in March 2017, which set off the two-year negotiation process to complete talks with the bloc about the terms of the withdrawal.
"During the implementation period, access to one another's markets should continue on current terms, and Britain should also continue to take part in existing security measures," May said in a speech in Florence.
"I know businesses, in particular, would welcome the certainty this would provide. As of today, these considerations point to an implementation period of around two years."
Michel Barnier, who has led the EU side through three rounds of Brexit negotiations, said on Thursday the conditions for a possible transition period should be defined "if the British government requests one".
TheCityUK, a body representing its financial industry, said on Thursday the UK must secure a transitional period "without delay" and stem the flow of jobs out of the country.
The speech was seen by some as a means by May to break deadlocked Brexit negotiations. The fourth round of talks was delayed by a week to September 25.
The UK wants to move talks on to trade, but the bloc is seeking to settle terms of the so-called "divorc" first (specifically how much Britain will pay for commitments made before it leaves), citizens' rights and Northern Ireland's border with the Republic of Ireland. This border will become the only UK/EU land frontier.
May said some of the figures put forward about how much the UK would have to pay when it withdraws from the EU – anything up to €80 billion or more – had been "exaggerated and unhelpful."
She did not provide a potential figure, although she said the EU would not have to "pay more or receive less" for the remainder of the bloc's current budget.
Single market/customs union
May acknowledged that, when the UK leaves the EU, it will also leave its single market and customs union.
She rejected the two possible replacements – a European Economic Area-type option, such as Norway's, or a free-trade agreement similar to the one between the EU and Canada that took effect on September 21.
"I don't believe either of these options would be best for the UK or best for the European Union," May said.
She said stakeholders should not "start from the false premise there is no pre-existing regulatory relationship between us".
"Precedent suggests it could take years to negotiate," she added, "and we can do so much better than this."
The prime minister said a "dispute-resolution mechanism" would have to be established to settle trade spats when they arise.
She said disagreements could not be ruled on by the Luxembourg-based European Court of Justice or the UK courts.
"It wouldn't be right for one party's court to have jurisdiction over the other," she said. "I am confident we can find an appropriate mechanism for resolving disputes."
On security matters, May repeated a proposal already set out in a UK position paper that a treaty be struck with the EU covering law enforcement and criminal justice.
(Alistair Holloway, email@example.com, +352 49 93 39)