Britain's Brexit plan gets guarded Brussels welcome

VIDEO: REUTERS

BRUSSELS (REUTERS) - Britain's proposal for a Brexit deal received a guarded welcome in Brussels on Thursday (July 12), with the European Parliament's delegation saying the wide-ranging draft went in the direction it wanted.

The Brexit group of the parliament, which has a right of veto over the deal, said a comprehensive deal, covering economic, foreign and security policy, had been the parliament's preferred option from the start.

However, there are many details in the plan that Prime Minister Theresa May published on Thursday that would need to change.

While May's proposal seeks close ties in many areas, including free movement of goods, the European Parliament group was sceptical about customs arrangements.

London says it can apply EU tariffs for imports intended for the EU and its own tariffs for goods destined for Britain.

The EU parliament group said there was "no space" for outsourcing EU customs competences. It also reminded London that it needs first to concluded negotiations on withdrawal, including the unresolved issue of how to ensure there is no return to a hard border between Ireland and Northern Ireland.

On financial services, Britain wants a bespoke trading deal based on mutual recognition or the UK and EU accepting each other's rules, dismissing "equivalence" regimes which provide limited access for some non-EU partners to some parts of the market.

 

Luxembourg's Finance Minister Pierre Gramegna said he favoured "enhanced equivalence" that could give British banks extensive access to EU markets.

However, German Finance Minister Olaf Scholz said there was no question of having outside legislators deciding on EU financial services rules after Brexit.

EU Brexit negotiator Michel Barnier, in a tweet, reminded Britain of what the EU had offered - an ambitious free trade agreement and cooperation on a wide range of issues, including security.

"Looking forward to negotiations with the #UK next week," he tweeted.