U.K. Disputes German Media Report of Juncker Brexit Concerns

(Bloomberg) -- The U.K. government rejected a German newspaper report that a dinner between Prime Minister Theresa May and European Commission President Jean-Claude Juncker last week exposed a growing gap between the two sides in the Brexit negotiations. 

“We do not recognize this account,” a spokesman, who asked not to be named, said in an email to Bloomberg. “As the prime minister and Jean-Claude Juncker made clear, this was a constructive meeting ahead of the negotiations formally getting underway.”

Germany’s Frankfurter Allgemeine Sonntagszeitung newspaper on Sunday said that Juncker left the April 26 talks at Downing Street shocked at May’s reluctance to compromise and “ten times more skeptical” of reaching a mutually acceptable deal over Brexit. After the meeting, Juncker put the chances of a complete breakdown in the negotiations at over 50 percent, the newspaper said, citing people briefed by Juncker.

The report is a further sign that the initial part of the Brexit discussions will be spent resolving just what to talk about, risking a falling out even before substantive matters have been debated. The two sides have until March 29, 2019, to find common ground. At that point, Britain will leave the EU regardless of whether it has a deal or not.

‘Illusions’

An EU official said that there is a mismatch between the U.K.’s expectations for the negotiations and the view from Brussels and that the best the British government can hope for is to agree a framework for its future trading relationship before the two-year deadline. The U.K. government is unrealistic about the pace of separation talks, the official said.

Juncker was particularly alarmed by May’s view that Britain doesn’t owe the other EU states any money, FAS said. The EU’s view is that the U.K. will have to pay somewhere between 40 billion euros and 60 billion euros ($44 billion to $65 billion) when it leaves the bloc to cover its outstanding commitments.

He also thought her aim of resolving the status of EU and British citizens affected by the split at the next EU summit in June failed to appreciate the complexity of the issues involved, FAS said.

Juncker called German Chancellor Angela Merkel the next morning to brief her and their conversation prompted Merkel’s comment that some in the U.K. government have “illusions” about what lies ahead, FAS said.

A spokesman for European Commission declined to comment on the FAS report, and pointed to Juncker’s comments on April 29, when he said the meeting was friendly and constructive.

“It was excellent. I’m not talking about the food,” Juncker told reporters that day.

--With assistance from Nikos Chrysoloras

To contact the reporters on this story: Brian Parkin in Berlin at bparkin@bloomberg.net, Robert Hutton in London at rhutton1@bloomberg.net.

To contact the editors responsible for this story: Reed Landberg at landberg@bloomberg.net, Ben Sills, Andrew J. Barden