In a sensational development for the entire process, the UK is planning legislation which would effectively dump a crucial part of the original deal relating to Northern Ireland. The internal market bill is set to published on Wednesday – and it will “eliminate the legal force of parts of the withdrawal agreement” in areas related to state aid and Northern Ireland customs, the Financial Times has claimed. Mr Johnson has thrown down the gauntlet by imposing a deadline of October 15 to strike a deal with the bloc.
The Prime Minister will argue there is no point thinking about timelines beyond that date
He will add: “If we can’t agree by then, then I do not see that there will be a free trade agreement between us, and we should both accept that and move on.”
Britain left the EU on January 31 but talks aimed at reaching a new trade deal before the end of the transition period on December 31 have so far hit snags on state aid rules and fishing.
Without a deal more than £750billion in trade between Britain and the EU could be thrown into uncertainty with rules over everything from car parts and medicines to fruit and data.
Michel Barnier, the EU’s chief Brexit negotiator, described the Northern Ireland protocol as being “critical for single-market integrity” – while declining to comment on the FT’s report specifically.
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8.15am update: Pound weakens on no-deal fears
London’s FTSE 100 bounced from a near four-month low on Monday as the pound weakened on growing prospects of the UK leaving the European Union without a trade agreement, while Primark-owner Associated British Foods jumped on issuing a strong forecast.
The export-heavy FTSE 100, which generally moves in the opposite direction to the pound, was up 0.8 percent after ending Friday with its biggest two-day slide in nearly a month following a tech-led plunge on Wall Street.
Healthcare and financial firms were among the boosts to the FTSE 100 in early trading, while the domestically-focussed FTSE 250 rose for the first time in three sessions, up 0.7 percent.
8.10am update: Blackford warns of dangers of “devastating” hard Brexit
A “hard Brexit” would be “devastating” for Scotland, the SNP has said.
The party’s Westminster leader Ian Blackford said in a statement: “Boris Johnson’s reckless plans for the hardest of Brexits would be devastating for Scotland, causing lasting damage to Scottish jobs and the economy in the middle of a pandemic.
“By threatening to undermine the UK’s international treaty obligations and impose a catastrophic no-deal Brexit on Scotland against our will, the Prime Minister is proving he cannot be trusted and is underlining the need for Scotland to become an independent country.
“Scotland has been completely ignored by Westminster throughout the Brexit process. It is increasingly clear that the UK will now be leaving the EU with either a very bad deal or no deal at all – either of which would be a disaster for Scotland.
“With the Tories hardening their Brexit plans and threatening Scotland with a power grab, it is clearer than ever that the only way to protect Scotland’s economic interests and our place in Europe is to become an independent country.”
8.07am update: Let EU fishermen in! Barnier lashes out at Boris as Brussels makes UK waters power grab
Michel Barnier has warned he is “worried” for the fate of the post-Brexit trade talks ahead of this week’s make-or-break negotiating round in London.
The Brussels diplomat hit out at his British counterpart for trying to secure a “best of both worlds” divorce from the bloc.
The Frenchman said: “I remain worried. The negotiations are difficult, because the British want the best of both worlds.
“We did not go to bed, in the end the interests of the EU are respected.”
7.52am update: Government “considering fall back options”, says spokeswoman
Approached about the reports, a Government spokeswoman said it was working to “protect Northern Ireland’s place in our United Kingdom”.
She said: “We are working hard to resolve outstanding issues with the Northern Ireland Protocol through the Joint Committee and will continue to approach these discussions in good faith.
“As a responsible Government, we are considering fall back options in the event this is not achieved to ensure the communities of Northern Ireland are protected.”
7.50am: Pulling plug on WA would effectively torpedo hopes of a deal, warn eurocrats
AN EU diplomat suggested the UK would regret reneging commitments enshrined in the Withdrawal Agreement.
The official said: “‘Pacta sunt servanda’ meaning ‘agreements must be kept’ is a fundamental principle in international law.
“If the UK chose not to respect its international obligations, it would undermine its international standing.
“Who would want to agree trade deals with a country that doesn’t implement international treaties?”
Another EU diplomat, speaking on condition of anonymity, said: “Without correct implementation of the Withdrawal Agreement, I cannot imagine the EU would conclude a treaty with a country that does not abide by its treaty commitments.”
7.45am update: “Not so oven-ready after all,” says Labour’s Ashworth
Speaking to BBC Radio 4’s Today programme, Labour’s shadow health secretary Jonathan Ashworth said: “Boris Johnson, I thought, told us he had an oven-ready deal. And, he fought a general election telling us he had an oven-ready deal, now suggests that he was misleading people in that general election.
“And Parliament supported the Withdrawal Agreement earlier on this year. He has made promises and signed a treaty around these arrangements for Northern Ireland, and he now seems to be backing out of that.
“I think people will be very surprised that when he promised us an oven-ready deal, it now looks like he’s pushing us towards no deal at a time when we are in recession, at a time when many fear for their jobs, at a time when the furlough scheme is coming to an end.
“We should be putting in place measures to grow our economy, not do further damage to our economy.”
7.43am update: Eustice downplays Withdrawal Agreement claims
A senior British minister on Monday played down planned legislation that could override the Brexit Withdrawal Agreement, saying the goal posts were not being changed but that some ambiguities needed to be tidied up.
Asked about a report in the Financial Times, Environment Secretary George Eustice said there moght be some minor legal ambiguities that need to be tidied up over the Northern Irish protocol.
He said the UK was committed to the Northern Ireland protocol and that London was not moving the goal posts.
7.36am update: “Self-defeating strategy”
If the UK presses ahead with the plan being widely reported today, it will be a self-defeating strategy, a Brussels insider has said.
Katya Adler, the BBC’s European Correspondent, tweeted: “Senior EU diplomat from country traditionally close to UK: ‘If UK domestic legislation undermines international treaty recently signed by UK+EU, this isnt only a trust orcredibility issue, it could cause trade negotiations to unravel. It wld be a self-defeating strategy by the UK’
7.29am update: Coveney said dumping WA would be “very unwise”
Irish Foreign Minister Simon Coveney, who played a key role in negotiating the withdrawal agreement and Northern Ireland protocol, said on Twitter that the reported move “would be a very unwise way to proceed.”
Senior members of Northern Ireland’s Sinn Fein and SDLP parties, the region’s two largest Irish nationalist groups, also criticised the British government’s plan, as reported by the newspaper.