European Council chief Donald Tusk rejects PM's trade deal proposals

The head of the European Council has rejected Theresa May’s plans for a complicated sectoral Brexit deal, insisting that there can be “no pick-and-mix” approach to the future relationship.

Donald Tusk said the future was one of “more complicated and costly” trade with the continent as the two sides “drift apart”.

In a pointed press conference in Luxembourg, Tusk said the only option available to the Prime Minister was a Canada-style trade deal.

And while he said the bloc was willing to offer tariff-free trade with the UK, it would depend on European fishermen being given continued access to British waters – a demand that will enrage many Brexiteers.

While he offered close cooperation in security, scientific research and education, the head of the EU27 member states stressed the overall outcome of Brexit would be economically negative.

“This positive approach doesn’t change the simple fact that because of Brexit we will be drifting apart,” Tusk said.

“This will be the first free trade agreement in history that loosens economic ties instead of strengthening them. Our agreement will not make the trade between the UK and the EU frictionless or smooth, it will make it more complicated and costly than today for all of us.

“This is the essence of Brexit. To sum up, we will enter the negotiations of the future negotiations with the UK with an open, positive and constructive mind, but also with realism."

He stressed that the idea of a sector-by-sector approach to trade would not work for Brussels, saying: “A pick and mix approach for a non-member state is out of the question. We are not going to sacrifice these principles. It’s simply not in our interest.”

MUTUAL RECOGNITION

The Council’s draft document appears to snub May’s proposals for mutual recognition of regulation between the UK and the continent.

It notes that after Brexit the two sides will “no longer share a common regulatory, supervisory, enforcement and judiciary framework”.

At the same time, Brussels appears to hope that May will relent on her negotiating red lines, including leaving the EU’s customs union.

“The above approach reflects the level of rights and obligations compatible with the positions stated by the UK. If these positions were to evolve, the Union will be prepared to reconsider its offer,” the document says.

IRISH BORDER

The guidelines also imply there will have to be a hard border on the island of Ireland, despite the Government and the DUP both saying they oppose any change to the status quo.

One passage says: “Divergence in external tariffs and internal rules as well as absence of common institutions and a shared legal system, necessitates checks and controls to uphold the integrity of the EU Single Market as well as of the UK market.”

EU PARLIAMENT

Meanwhile, the European Parliament has also issued its own resolution - its fourth relating to Brexit - calling for an "association agreement" between the EU and the UK.

The Parliament is not involved in negotiations, but MEPs will get a vote on the final deal.