U.K. Said Not to Expect EU Concessions by Feb. 13: Brexit Update

(Bloomberg) -- The U.K. government doesn’t expect to bring a revised Brexit deal back to Parliament by Feb. 13, according to a person familiar with the situation. Theresa May is in Northern Ireland as part of her efforts to resolve the impasse on the Irish border, and the European Union offered Ireland its full backing ahead of May’s visit to Brussels on Thursday.

Key Developments:

  • U.K. government not expecting EU concessions by Feb. 13 (4:25 p.m.)
  • EU stands by Ireland over the backstop; Irish PM says it’s important for Ireland, but also for other small countries in the bloc
  • Tory MPs seeking backstop compromise aim to finish work this week (11:15 a.m.)
  • Tusk says there’s a “special place in hell” for those who campaigned for Brexit without making a plan to deliver it “safely”

U.K. Doesn’t Expect EU Concessions by Feb. 13 (4:25 p.m.)

The U.K. government doesn’t expect to bring a revised Brexit deal back to Parliament by Feb. 13, according to a person familiar with the situation.

May had said she aims to bring a revised deal back as soon as possible and that if she hasn’t done so by Feb. 13, Parliament would have another debate on Brexit the following day. That would give an opportunity for lawmakers to propose amendments that can redefine Brexit, or even seek to postpone it.

The prime minister travels to Brussels on Thursday and Dublin on Friday.

Juncker Doubles Down on Backstop (4 p.m.)

European Commission President Jean-Claude Juncker said there can be no unilateral exit from the backstop for the U.K.

Speaking alongside Irish Prime Minister Leo Varadkar in Brussels, Juncker said the idea of “alternative arrangements,” pushed by British lawmakers can’t replace the backstop and the U.K. Won’t be able to leave the arrangement without EU agreement.

Scottish Police Brace for Brexit (2:30 p.m.)

In Scotland, which voted to remain in the EU and whose government is bitterly opposed to leaving the single market and customs union, the police force is getting ready for disruption.

Police Scotland said it plans to put 360 officers on standby from the middle of next month to deal with potential incidents arising from the departure. They include public disorder and problems at ports and airports. Personnel would be available for deployment elsewhere in the U.K. if needs be, particularly Northern Ireland, the deputy chief constable said.

Scottish Justice Secretary Humza Yousaf said the police were being prudent and “the reality is the U.K. is not prepared for a ‘no-deal’ Brexit in less than two months’ time.”

Germany Prepared to Be ‘Creative’ on Brexit (1:25 p.m.)

Chancellor Angela Merkel’s chief spokesman, Steffen Seibert, revived a comment the German leader made this week about “creativity” when it comes to the backstop, though didn’t elaborate much.

“If you want to achieve that, if you want to have a view of a future relationship, then you have to do it with creativity,” Seibert told reporters in Berlin. “That’s self-evident. We’re prepared to be creative, but we also expect the same effort from the British side, to say what direction they want to go.”

There’s still time to reach an agreement, Seibert said, reiterating that the EU-27 will do “everything” to ensure that there is no disorderly U.K. exit.

Efforts much shift to negotiations over the future relationship, he said, comparing the backstop to fire insurance.

“If you buy fire insurance, you also hope that it doesn’t burn,” Seibert said. “You rely on your luck, you protect yourself from a risk that you hope doesn’t happen.”

Brexiteers Hit Out at May Over Backstop (1 p.m.)

With May in Belfast, her deputy David Lidington filled in during prime minister’s questions in Parliament.

Pro-Brexit Tories did not hide their frustration with May for failing to deliver on last week’s vote in Parliament, which called for the government to scrap the backstop, not merely to change it as she proposes.

Bernard Jenkin demanded to know what the government is doing with the "Malthouse Compromise" plan for new technology to allow an open border with Ireland. Talks are ongoing but they are not moving fast enough for Jenkin. “What’s holding it up?” he asked.

His fellow Conservative Brexiteer Mark Francois asked Lidington why the government is not following through on the vote, which supported replacing the backstop with alternative arrangements. “Which bit of ’replaced’ was not clear?" Francois said.

Tusk Ponders a Special Place in Hell (11:50 a.m.)

Tusk attacked British politicians who campaigned for Brexit without knowing what it should look like.

"I’ve been wondering what the special place in hell looks like for those who promoted Brexit without even a sketch of a plan on how to carry it out safely," he told reporters alongside Varadkar.

U.K. Said Not to Expect EU Concessions by Feb. 13: Brexit Update

Tusk, who has long hoped that Brexit would somehow be called off, said it was now clear that the divorce will happen. There is no "leadership for remain,” he said. The priority now is to avoid no-deal, and to safeguard an open Irish border. He said the EU won’t "gamble with peace," and won’t accept a time limit on the backstop.

Fox Says Scrapping Tariffs is an Option (11:25 a.m.)

International Trade Secretary Liam Fox said it won’t be up to him, but a no-deal Brexit could force the government to abolish all import tariffs in key sectors.

Appearing at a parliamentary committee, Fox said the government will "have to consider" the options to keep prices down for consumers, and balance that against the impact on jobs. Sectors such as farming and ceramics would be hit if tariffs were scrapped, Fox said. "In the agricultural sector it’s very clear what the impact would be were we to move to zero tariffs."

He said nobody in government was proposing moving to zero tariffs, and he did not advocate the idea, but it will be a collective government decision to make if there is a no-deal Brexit.

Fox said if there was no divorce agreement with the EU, and the U.K. wanted to keep EU goods tariff-free, it would have to apply the same rule to goods coming from elsewhere too, under global trading rules.

In Search of Solutions (11:15 a.m.)

Conservative MPs trying to find a compromise fix for the Irish border meet for the third time in three days this afternoon. They’re aiming to find a deal that their party can vote for and that the EU can agree to by the end of the week, according to MPs in the group.

They still think Theresa May is taking them seriously, despite comments on Tuesday that she only wanted to change the backstop rather than scrap it entirely. One observed that the prime minister tends to stick to her lines rigidly until she’s ready to change them. The group is driven by a belief that only a united Conservative Party can get anything through Parliament in the 51 days left before Brexit.

The vote on the deal is only the start of that process: One MP estimated the government has to win 50 more votes to get everything through.

The discussions in the room are around the practical issues involved in using different customs technologies, according to an MP present: How many more checks would be required on goods? Where could they take place? There are around a dozen civil servants in the meetings, which have lasted two hours each so far. The MPs reckon there are signs the government is already looking at technological border solutions.

Clark: Some Industries Need Tariff Defense (11:10 a.m.)

In the Parliament committee, Clark is asked about reports International Trade Secretary Liam Fox is preparing to roll out a zero-tariff trade regime on imports in the event of a no-deal Brexit -- and the business secretary tried hard not to create division.

“There are some industries, the ceramics industry for example, where there has been some very aggressive anti-competitive dumping from China in particular, and we need to maintain our defenses on that,” he said. The U.K.’s tariff regime would need to be “bespoke,” Clark said, adding that the government does want zero tariffs on trade with the EU.

Clark Indicates He’d Resign Over No-Deal Policy (10:45 a.m.)

In Parliament’s business committee, Greg Clark said he wasn’t in favor of delaying Article 50 to try to reach a deal with the European Union, arguing that would only prolong the uncertainty facing businesses. Parliament needs to find “common ground,” he said, repeating the government’s line that the only way to prevent a no-deal exit is to vote for an agreement.

He also indicated he’d resign from government if it ever became official policy to pursue a no-deal Brexit. “Many people on all sides of the House would regard that as unacceptable,” he said. On a deal, he said: “As long as that remains the policy of the government, I will be a vigorous proponent of that.”

“We need to make a deal,” he said.

Brexit Deadline for Some Businesses Days Away (10:30 a.m.)

Business Secretary Greg Clark told lawmakers that while the deadline for a Withdrawal Agreement and for the U.K. to enter a transition period is March 29, many exporters and importers will have to make decisions much sooner.

Given that it takes six weeks to ship to countries like Japan and South Korea, which the U.K. currently trades with on EU membership terms, exporters will need to decide imminently whether to send products to those markets, Clark said. They won’t know yet whether tariffs will be applied, what country of origin rules will be applied, he said.

“We should not regard the 29th of March or 28th of March as the time we should be prepared to take to conclude a deal,” he said. “The last minute for important exporters is fast approaching. It’s the next few days or weeks.”


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