EU takes tough stance on May’s Brexit demands

London must start paying divorce costs before any parallel negotiations on trade can begin, according to negotiation guidelines laid out by bloc's president.

The EU president Donald Tusk, right, is welcomed by Maltese prime minister Joseph Muscat as he arrives in St Julian’s Malta on March 31, 2017 to announce the bloc’s stance on negotiations for Britain’s withdrawal. Matthew Mirabelli / AFP
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Valletta // The European Union has demanded that Britain make “significant progress” on its divorce from the bloc before talks on a trade deal can start, in tough Brexit negotiating guidelines unveiled on Friday.

EU president Donald Tusk rejected British prime minister Theresa May’s demand for immediate parallel negotiations in her letter triggering the Brexit process on Wednesday.

Mr Tusk said London must first make headway on the paying the costs of the split, safeguarding the rights of three million European citizens living in Britain, and also the border in Northern Ireland.

The clash underscored the tensions in the divorce as Britain prepares to be the first country to leave the EU in its 60-year history.

The fallout from Brexit kept coming for London on Friday, with Spain pressing its claim to Gibraltar and Scotland formally calling for a second independence referendum.

“The EU 27 does not and will not pursue a punitive approach. Brexit itself is already punitive enough,” Mr Tusk said as he revealed his plans in Malta, which currently holds the EU rotating presidency.

The draft guidelines set the tone for the coming two years of Brexit talks and will now be sent to the capitals of the 27 remaining EU countries ahead of a special summit in Brussels on April 29.

Mr Tusk’s guidelines appeared to offer a small compromise, saying that some trade talks could eventually be held at the same time, but he insisted on a “phased approach” during the Brexit process.

“Starting parallel talks on all issues at the same time as suggested by some in the UK will not happen,” the former Polish premier said.

“Once and only once we have achieved sufficient progress on the withdrawal can we discuss the framework for our future relationship.”

France and Germany have led opposition to the parallel talks that Ms May had demanded.

But Britain is keen to get things moving as quickly as possible, fearing the “cliff edge” of an exit from the EU’s single market in March 2019 without a new deal.

London said it had expected a “robust” position in the EU guidelines.

“We’ve been clear for some time now we expected robust positions to be taken at the start. The negotiation will get under way and let’s see where we end up,” a spokesman for Mrs May said.

Brexit got off to a rocky start after Mrs May warned in her letter that failure to clinch a deal on trade would affect Britain’s cooperation on terrorism and security.

Mr Tusk ruled out the suggestion there was an inherent threat in the warning.

“I know Theresa May well enough and I know her approach to this issue. This is why I rule out this kind of interpretation ... that security cooperation is used as a bargaining chip. It must be a misunderstanding,” he said.

British foreign secretary Boris Johnson, in Brussels as Nato ministers met US secretary of state Rex Tillerson, said London was committed to European security and that it was “not some bargaining chip” in the Brexit talks.

Britain’s very unity is at stake in the negotiations.

The EU’s guidelines state that Spain must have a say over whether any post-Brexit deal applies to the British territory of Gibraltar, over which London and Madrid have rowed for 300 years. The outpost at the southern point of the Iberian Peninsula has a population of 32,000 and about 96 per cent of its residents voted to remain in the EU last year.

Scotland’s government meanwhile made a formal request to London for a second vote on Scottish independence, given that a majority of Scots also voted to stay in the EU.

“The people of Scotland must have the right to choose our own future,” said First Minister Nicola Sturgeon, who has called for a new vote by early 2019.

EU-UK talks could start as soon as May 22 when the bloc’s Brexit negotiator Michel Barnier is expected to get a mandate from the EU 27, although “pre-negotiations” on the language and format of the discussions could begin sooner.

European officials suggested enough progress could be made on the divorce arrangements by the end of the year to begin trade talks, although EU leaders will have the final say.

But time will be short as Mr Barnier has said that a draft deal is needed by October 2018 if it is to be ratified in time by the European parliament and member states.

The EU guidelines say they are also open to a transitional arrangement after Brexit as a “bridge” to a future deal some years down the line.

But the bloc insisted that it would have to be under EU rules and the European Court of Justice, a politically toxic condition in Britain give that national sovereignty was a key issue in the Brexit referendum.

The EU said meanwhile it would “prepare itself to be able to handle the situation also if the negotiations were to fail”.

* Agence France-Presse with additional reporting from Associated Press