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Trade barriers 'unavoidable' outside customs union, says EU's Barnier Trade barriers 'unavoidable' outside customs union, says EU's Barnier
(35 minutes later)
The UK will face "unavoidable" trade barriers if it leaves the customs union and single market, the EU's chief negotiator Michel Barnier has said. The UK will face "unavoidable" barriers to trade if it leaves the customs union and single market, the EU's chief negotiator Michel Barnier has said.
Speaking in Downing Street, Mr Barnier said "the time had come" for the UK to choose what it wanted after Brexit. Speaking in Downing Street, he said the "time had come" for the UK to choose what it wanted after its 2019 exit.
Brexit Secretary David Davis said the UK's position was "perfectly clear".Brexit Secretary David Davis said the UK's position was "perfectly clear".
He said the UK wanted a free trade deal with the EU but the ability to strike other deals outside the customs union, adding "there's no doubt about it". The UK, he argued, wanted a free trade deal with the EU but also the freedom to strike deals with other countries, where trade opportunities were growing.
Mr Barnier, who has held talks with Theresa May and David Davis in London, said he respected the UK's "red lines", but EU rules must be respected. "There's no doubt about it. We are leaving the customs union but we are aiming for a good future for Britain."
There is "not a moment to lose" if the UK and EU are to reach a Brexit deal by October, he said. Mr Davis also said he was confident the two sides would reach an agreement on a "transitional" or "implementation" phase - to last between 18 months and two years after the UK leaves next year - in time for an EU summit at the end of March.
Downing Street earlier insisted Britain will not be in a customs union with the EU, amid claims of Tory disunity. After holding talks with Mr Davis and Theresa May in London, Mr Barnier said there was "some divergence" between the two sides when it came to issues relating to transition and how the exit deal would be enforced.
Mrs May faces calls to spell out more detail of what she wants in talks ahead of the UK's departure in March 2019. While he said he respected the UK's decision to rule out any form of long-term customs union and other so-called "red lines", he said it was a prerequisite of any deal that "everyone plays by the same rules" during the transition period - where the UK would have to comply with existing EU laws and regulations.
The prime minister and Brexit Secretary David Davis met Mr Barnier ahead of the next round of negotiations getting under way. He said he wanted greater clarity from the UK about what ultimate relationship it wanted with the EU after its departure, expressing his hope an "official position" would be put forward soon.
Talks between officials this week will focus for the first time on the "transitional" period - of about 18 months to two years - which both sides want after Brexit on 29 March 2019. But he warned: "Without a customs union and outside the single market, barriers to trade in goods and services are unavoidable. The time has come to make a choice."
The next round of negotiations are getting under way, with officials this week focusing for the first time on the "transitional" period as well as details from the December's agreement on the Irish border and citizens' rights.
Potential sticking points include citizens' rights, with the UK insisting EU nationals arriving during this time should not have the same future rights as those who arrive before Brexit day.Potential sticking points include citizens' rights, with the UK insisting EU nationals arriving during this time should not have the same future rights as those who arrive before Brexit day.
As he set off for London, Mr Barnier said time was of the essence.
"There is so much work, so we have decided for this reason to accelerate all the contacts," he said.
"We want to reach a deal, respecting the guidelines of the European Council, respecting the rules of the single market of the Union. So once again we have not a minute to lose."
Asked about the UK's apparent decision to discount any future customs union, he suggested this was not news to him.
"We have to respect the red lines of the British government but they have to respect the rules of the union."
The UK's future relationship with the EU's single market and customs union has been a topic of debate among leading Brexiteers and some of those closest to the prime minister.The UK's future relationship with the EU's single market and customs union has been a topic of debate among leading Brexiteers and some of those closest to the prime minister.
In a customs union the UK would have tariff-free trade within the EU, but would lose the ability to strike its own deals with other countries.In a customs union the UK would have tariff-free trade within the EU, but would lose the ability to strike its own deals with other countries.
Downing Street said the government had set out two potential alternatives last summer - a new customs partnership without the need for any customs checks and a "highly streamlined" arrangement in which EU arrivals would be subject to customs checks but in a way that minimised disruption through technology.Downing Street said the government had set out two potential alternatives last summer - a new customs partnership without the need for any customs checks and a "highly streamlined" arrangement in which EU arrivals would be subject to customs checks but in a way that minimised disruption through technology.
No 10 would not say which was the preferred option and said work was continuing on both proposals.No 10 would not say which was the preferred option and said work was continuing on both proposals.
Conservative MEP Daniel Hannan said Switzerland was an example of a country which had both its own customs arrangements with the EU and an independent trade policy.Conservative MEP Daniel Hannan said Switzerland was an example of a country which had both its own customs arrangements with the EU and an independent trade policy.
"Britain is a global country, a world trader," he told the BBC's Daily Politics."Britain is a global country, a world trader," he told the BBC's Daily Politics.
"We have always been artificially penalised, more than any other country, by the customs union... because we are usually just the only country in the EU than trades more outside the EU than with the EU.""We have always been artificially penalised, more than any other country, by the customs union... because we are usually just the only country in the EU than trades more outside the EU than with the EU."
"When we have the freedom to do that again, we will see the price of goods falls, the whole economy is stimulated, food and fuel prices come down and we are better off because we have more money to spend on other things.""When we have the freedom to do that again, we will see the price of goods falls, the whole economy is stimulated, food and fuel prices come down and we are better off because we have more money to spend on other things."
'Treaty obligations''Treaty obligations'
The government's 10-strong Brexit cabinet sub-committee will meet on Wednesday and Thursday as UK officials prepare to brief their EU counterparts on their vision for post-Brexit relations on Friday. The government's 11-strong Brexit cabinet sub-committee will meet on Wednesday and Thursday as UK officials prepare to brief their EU counterparts on their vision for post-Brexit relations on Friday.
Former Attorney General Dominic Grieve said he found Downing Street's intervention "rather strange" since the UK would have to maintain some form of "customs union or alignment" with the EU if it was to honour the terms of its agreement to prevent any hard border on the island of Ireland.Former Attorney General Dominic Grieve said he found Downing Street's intervention "rather strange" since the UK would have to maintain some form of "customs union or alignment" with the EU if it was to honour the terms of its agreement to prevent any hard border on the island of Ireland.
"The December agreement is going to be turned in the course of the next few months from an outline agreement into a treaty," the Conservative MP told BBC News."The December agreement is going to be turned in the course of the next few months from an outline agreement into a treaty," the Conservative MP told BBC News.
"We are leaving the EU but we are going to move into a new treaty relationship with the EU from outside it which is just as binding on us as our EU treaty obligations.""We are leaving the EU but we are going to move into a new treaty relationship with the EU from outside it which is just as binding on us as our EU treaty obligations."
Labour said it was "foolhardy" to rule out any kind of customs union with the UK's largest trading partner.Labour said it was "foolhardy" to rule out any kind of customs union with the UK's largest trading partner.
"The government must put jobs and the economy first, not their own internal party wrangling," a party spokesman said."The government must put jobs and the economy first, not their own internal party wrangling," a party spokesman said.