Rutte Says No-Deal Now Probable as EU Sets Terms of Brexit Delay

(Bloomberg) --

European leaders signaled a no-deal Brexit on April 12 is now a probable outcome, as officials warned that granting any additional extension would be tied to conditions that the British government could find unpalatable.

“We have to take into consideration a no-deal possibility. It’s a probability,” Dutch Prime Minister Mark Rutte told reporters in Luxembourg on Tuesday, after the House of Commons failed again to agree on a way forward in the stalled negotiations. “We are no longer looking for an exit, but rather an emergency exit,” Luxembourg’s Prime Minister Xavier Bettel seconded.

With the Brexit deal struck with Theresa May last November all but dead, the EU is toughening its rhetoric, saying it’s ready for the worst-case scenario of a no-deal split. But an extension to the U.K.’s membership is also becoming more likely, as Parliament maneuvers to force May to seek one, and the bloc is refining its conditions.

According to two EU diplomats, they would be:

• That the U.K. commits not to disrupt the functioning of the EU, such as by getting actively involved in the process for the appointment of new chiefs for the bloc’s institutions in June, or the negotiations for the new trillion-euro multiannual budget
• That the U.K. holds elections for the EU Parliament in May
• That the request has a clear reasoning, such as to allow time for a snap election in Britain, or a second referendum. The EU says it won’t agree to an extension aimed at renegotiating the existing withdrawal agreement
• That the U.K. continues to act otherwise as if it’s a full member of the EU, meaning that it won’t be allowed to negotiate post-Brexit trade accords without consulting with Brussels

If these conditions aren’t met, then the EU won’t agree to a long extension, according to the diplomats who asked not to be named, as talks ahead of a crunch summit of EU leaders on April 10 are private. As for a short extension, the bloc’s chief Brexit negotiator Michel Barnier reiterated on Tuesday that this will only be acceptable if the U.K. Parliament has in the meantime approved the existing withdrawal agreement.

“We said what our position is at the last summit, an extension is possible to clarify the situation in the case the deal is accepted,” Belgian Prime Minister Charles Michel told reporters on Tuesday. But if there’s no deal, “we will see what will happen in the coming days.”

To contact the reporters on this story: Stephanie Bodoni in Luxembourg at sbodoni@bloomberg.net;Viktoria Dendrinou in Brussels at vdendrinou@bloomberg.net;Nikos Chrysoloras in Brussels at nchrysoloras@bloomberg.net

To contact the editors responsible for this story: Chad Thomas at cthomas16@bloomberg.net, Richard Bravo, Emma Ross-Thomas

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