Davis Pushes Back Brexit Deadline as Fight Brews Over Transition

  • Brexit secretary says timetable may slip to ’year-end’
  • Transition talks face hurdles as euroskeptic voice complaints
U.K. Wants `Minimalist' Customs Deal, Clarity on Future Relationship

David Davis pushed back against the European Union’s deadline of getting a Brexit deal done by October, saying the U.K. wouldn’t sign anything until it gets clarity on the future trade deal on offer.

Raising the prospect of another year-end round of brinkmanship, the U.K.’s Brexit chief said a deal would be done in the last three months of 2018. A battle is also shaping up over the terms of the transition deal -- the two-year grace period that businesses are keen to pin down as soon as possible. 

EU chief negotiator Michel Barnier on Monday stuck to the stated goal of wrapping up the agreement by the end of October so there’s time for the European Parliament to approve it.

"We are also seeking of course the future relationship and the withdrawal agreement in parallel," Davis told a committee in the House of Lords over the course of a 90-minute session. “That may push it a little later because we will not want to sign the withdrawal agreement until we have got the substance of the future relationship ironed out as well.”

The future trade deal won’t be signed until after the U.K. has left the bloc, and formal negotiations will probably have to continue into the transition period.

Money’s Worth

But the U.K. wants as detailed an outline as possible of the future trade deal that’s on offer before it leaves, as once it has left much of its leverage will be gone and it will have already agreed to pay its parting financial settlement of about 40 billion pounds ($56 billion).

Talks also risk being pushed back by a fight over the terms of the transition agreement. While Davis said last week he was “relaxed” about it as the final trade deal was a greater priority, euroskeptic Conservative lawmakers are becoming increasingly vocal in their opposition to the limbo.

The U.K. will be a member in all but name, and won’t have voting rights. Euroskeptics such as potential leadership candidate Jacob Rees-Mogg say that makes Britain a “vassal state” and the EU could pass legislation during the period that could harm the U.K.’s interests. Their voice matters to Prime Minister Theresa May as she needs their support to stay in her job.

The government will seek ways of protecting the U.K. from new EU legislation that would damage its interests, May’s spokesman, James Slack, told reporters. The U.K. will also fight new demands from the EU on the issue of citizens’ rights, Slack said.

Most businesses want the government to agree to the EU’s demands so that the transition can be formalized as soon as possible, allowing them to put contingency planning on hold. The government aims for an agreement to be reached in time for an EU summit in late March.

— With assistance by Tim Ross

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