EU Is Said to Consider Brexit Compromise as Parliament Digs in

  • May’s speech eased deadlock but breakthrough remains unlikely
  • Davis, Barnier to hold press conference at noon in Brussels

EU leaders are considering going some way to meet one of the U.K.’s demands, signaling a minor breakthrough in Brexit talks after three months of scant progress.

While the European Parliament will call on leaders not to move talks on to the crucial trade deal at a summit next month, according to a draft resolution, European leaders are considering bringing forward talks on the transition period that will follow Brexit, according to people familiar with the situation.

The concession from the EU, while minor, would break the deadlock and make it easier for the U.K. to discuss the contentious divorce bill. It would also be a sign that Prime Minister Theresa May’s speech last week in Florence, where she pledged to continue paying into the EU’s budget for two years after leaving, hit some of the notes her European counterparts were hoping for.

With just 18 months to go before it leaves the club, the U.K. needs to get the terms of the transition agreed in order to mitigate the uncertainty facing businesses, some of which are already relocating. May said in Florence she wants a two-year transition during which trading terms remain unchanged. The quid pro quo is that the U.K. must accept all of the EU’s rules while losing any say in how they are made.

October Summit

The concession on transition would happen at the EU summit in October, where leaders may discuss changing the mandate of chief negotiator Michel Barnier to allow him to talk about the bridging arrangements alongside the divorce, according to the people. Governments are also considering whether to add language in their summit statement that assures the U.K. they are likely to accept a transition period, one of the people said.

Initially Barnier insisted that transition could only be discussed after the separation terms and the outline of the future trade relationship were agreed. He signaled on Monday that his mandate could be revised, but it would be up to EU leaders.

The two sides remain far apart on key issues, such as the role of the European Court of Justice, and that was also highlighted by the resolution of the European Parliament. The assembly, which has veto powers over the final deal, wants the ECJ to have jurisdiction in the U.K. during any transition, which Brexit Secretary David Davis ruled out as recently as last weekend. It also wants freedom of movement during the transition, while the U.K. wants to register Europeans entering Britain after 2019. Ireland, which will become home to the U.K.’s European border and wants as long a transition as possible, said today the transition could last as long as four years.

EU governments must approve the U.K.’s plans for a transition, and it can happen only if the two sides strike an overall deal on the British departure before March 2019. They still insist that talks must show “sufficient progress” on the three main separation issues of the bill, the rights of EU citizens in the U.K. and the Irish border before negotiations can start on trade. The definition of “sufficient progress” has always been open to interpretation.

Davis and Barnier are due to speak to reporters at noon in Brussels on Thursday.

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