After staring into the abyss, negotiators have found renewed momentum in the Brexit talks.
Although obstacles remain, there is now cautious optimism that the two sides are close to wrapping up agreement on all aspects of the U.K. divorce treaty apart from a solution to the Northern Ireland border issue, according to EU diplomats briefed on the talks.
Sticking points such as how future disputes about the agreement itself would be handled and the rights of EU citizens living on British military bases in Cyprus, for example, now appear closer to being resolved.
On the Irish border issue, finding a solution that is acceptable to Brussels, London and Northern Ireland’s Democratic Unionist Party, whose MPs vote with Theresa May’s Conservatives, is still a formidable challenge, but the fact that the talks have gathered momentum on other aspects of the Withdrawal Agreement is highly significant.
The U.K. is expected to bring forward new alternative proposals for a Northern Ireland “backstop” within days that are aimed at preventing the need for a hardening of the border between north and south, come what may.
“I have a hope, which is close to certainty, that at the end we’ll manage to achieve an exit deal” — Donald Tusk, European Council president
In the most optimistic scenario, the EU’s chief negotiator Michel Barnier will come to the October summit of EU leaders in less than two weeks with a final version of the Withdrawal Agreement. There will also be a draft of the political declaration that will set out areas of agreement and divergence on the U.K.’s future relationship with the bloc, a senior EU diplomat said. That would set the stage for a final agreement at a yet to be arranged special summit on November 17 and 18.
There had been fears that the negotiations were heading off track after a tetchy finale to the EU leaders’ summit in Salzburg, Austria last month. The apparent breakdown, with May demanding “respect” from her EU counterparts, led to a further dip in the pound and concerns that a no-deal scenario is becoming more likely. The toxic atmosphere was made worse by U.K. Foreign Secretary Jeremy Hunt comparing the EU to the Soviet Union in his speech to his party’s annual conference last week.
But after a rancorous three weeks, leading EU figures delivered a dose of optimism over the weekend that a deal can be done.
Speaking to reporters at an event in Kraków Saturday, European Council President Donald Tusk said: “I have a hope, which is close to certainty, that at the end we’ll manage to achieve an exit deal and a declaration about future relations which will be the best possible.”
European Council President Donald Tusk delivers a speech in Krakow, Poland | Jan Graczynski/EPA
Earlier that day, in an interview with three Austrian newspapers, European Commission President Jean-Claude Juncker said he is also now more optimistic. “I have reason to think that the potential for rapprochement between both sides has increased in recent days.”
And on Sunday, Irish Deputy Prime Minister Simon Coveney expressed optimism in an interview on Sky that a breakthrough could be found on Northern Ireland. “I believe we are going to see some new thinking,” he said, adding that Dublin wants to be “as constructive as we can be.”
Meanwhile, the political declaration — the document setting out the U.K.’s future relationship with the bloc, which will accompany the Withdrawal Agreement — is currently being prepared by Barnier and his team. It will set out an annotated list on the state of play, spelling out areas of divergence and convergence, according to five diplomats involved in a meeting of EU ambassadors in Brussels Friday at which it was discussed.
The finished draft is expected to be unveiled Wednesday at the regular meeting of commissioners before being presented to EU27 ambassadors later that day. Instead of a very detailed text, it will be a series of “annotated headlines,” according to one diplomat.
“The key is to provide as much room as possible and a clear promise for a more ambitious future deal if the U.K changes its red lines,” the diplomat said.
According to an EU official, the document will be between 10 to 20 pages long (much shorter than the draft Withdrawal Agreement, which is 129 pages).
The document is key to the ratification of the deal between the EU and U.K. because, while it is not legally binding, it is intended to map out the kind of future relationship that will be agreed between London and Brussels during a post-Brexit transition period. Some MPs and MEPs have said they will not sign off on the deal on the basis of a vague document promising a “blind Brexit.”
Barnier has repeatedly rejected the Brexit white paper published by the British government in July | Emmanuel Dunand/AFP via Getty Images
The annotated headlines format adopted by the Commission is seen as the most flexible given the uncertainties that still exist about the future relationship, said one diplomat briefed on the draft document. “And since we don’t know how much detail London wants, it’ll be more adoptable,” the diplomat said.
On the Withdrawal Agreement itself though, diplomats say that apart from the Irish border issue, there has been significant progress. “[There is] almost a closure on all issues,” said one diplomat, though others are more cautious.
“It will take some more effort in the coming days to get to that point,” said another.
A third senior diplomat said, “there was positive engagement of the U.K. as regards Cyprus and Gibraltar, as well as governance and readiness to discuss geographical indications [legal protections for luxury food names].” “Next week we will know for sure if the U.K. comes with clear political instructions after Tory Party congress, especially on … Ireland.”
“It will need some fixes [to apply the same model to the U.K.] but it seems feasible” — Diplomat
One sticking point has been the governance framework that will deal with future disagreements over the implementation of the deal itself. A major point of contention on the British side has been the EU’s insistence that the European Court of Justice must be the ultimate arbiter, but even here, there is cautious optimism.
“We need a strong dispute resolution mechanism,” said one of the diplomats, who explained that the Commission is working on a model similar to the one in its association agreement with Ukraine. Under that agreement, if there is a dispute between the two, it is referred to a joint committee made up of representatives of both sides. If the dispute is over the interpretation of EU law, then it is referred to an arbitration panel which can then refer it to the ECJ. Under Ukraine’s agreement, the ruling of the ECJ is binding on the arbitration panel.
“It will need some fixes [to apply the same model to the U.K.] but it seems feasible,” said one of the diplomats.
The proposal to adopt something close to the Ukraine model was discussed Thursday at a meeting of Brexit officials in Brussels. Germany, Belgium, Sweden and several other countries said they need to study it further, but one EU official said “things are going in the right direction.”
“The Commission seems to think it is doable,” the official said.
On the contentious issue of protections for EU luxury food names — so-called geographical indications such as Parmesan and Champagne — two of the diplomats said London understands its proposal is not acceptable to the EU. In the Brexit white paper published by the British government in July, it stated that the U.K. would set up its own system of GIs and invite applications from EU countries. Barnier has repeatedly rejected that plan and diplomats expect London to come up with a new proposal soon.
Progress has also been made on the issue of the British military bases in Cyprus. This is less politically contentious, but legal fixes are required to protect the rights of about 15,000 Cypriots living in the territories occupied by the bases. “This week there was substantial progress and an agreement on the U.K bases in Cyprus seems to be within reach,” said an EU official.