U.K.'s May Plans Last-Minute Brussels Dash to Seal Brexit Deal

(Bloomberg) -- U.K. and European negotiators are working to clinch a Brexit deal in the next 48 hours as Prime Minister Theresa May plans a last-minute dash to Brussels.

Last week, May got an agreement with the European Union on the divorce terms and the negotiations are now focused on the future post-Brexit trade agreement. May met EU Commission President Jean-Claude Juncker in Brussels on Wednesday and while they made progress, the text is still not finished.

After meeting Juncker for one hour and 50 minutes, May announced that she will return to Brussels for last minute talks on Saturday, just a day before EU leaders are due to sign off on the deal.

That wasn’t expected. But an EU official said the Saturday meeting would go ahead no matter what, indicating an expectation that the outstanding obstacles can be overcome. EU ambassadors expect to receive a draft on Thursday morning before a meeting with Sabine Weyand, the EU’s deputy chief negotiator.

Direction

Negotiating teams buckled down late Wednesday and were planning to work through the night to get the draft accord ready, one official said.

"We have given direction to our negotiators this evening. The work on those issues will now start immediately," May told the BBC. "I believe we have been able to give sufficient direction for them to be able to resolve those remaining issues."

If they don’t, there’s a chance EU leaders could cancel the gathering, which would deal a major blow to May’s hopes of concluding the negotiations by the end of November.

EU diplomats in Brussels had been told to expect the draft political declaration by midnight on Wednesday. Officials had warned that if the text wasn’t ready by Thursday morning, the summit was at risk. German Chancellor Angela Merkel made clear she wouldn’t go to Brussels on Sunday unless the deal was ready to sign.

A handful of tricky issues remain outstanding in the 20-page outline of the future trade and security agreement between Britain and the EU. These include the future of Gibraltar, over which Spain wants a say, fishing rights, and security.

Spain Threatens Veto

Spain will seek to veto the accord if its objections to the text aren’t addressed, Prime Minister Pedro Sanchez said in a news conference in Valladolid. Spain has said it can’t endorse the agreement unless it’s made clear that talks on the future relationship with Gibraltar will be a separate negotiation process that Spain must endorse. May spoke with Sanchez by phone late on Wednesday to say she wants an agreement that works for the U.K. and its overseas territories, including Gibraltar, according to her office.

The Gibraltar issue “looks quite intractable -- but nothing in the EU is ever truly intractable,” one diplomat said.

Meanwhile, the EU’s two most powerful countries, Germany and France, are divided over the Sunday summit. While Merkel refused to attend unless the deal is already sealed, French President Emmanuel Macron wants the opportunity to discuss the text himself, rather than leave it to lower-level officials, diplomats with knowledge of the discussions said.

At home, May’s political position remains precarious. She is battling adversaries in her own Conservative Party who are plotting to oust her while members of her Cabinet are pushing her get a better deal.

DUP Warning

The withdrawal deal agreed on last week is unpopular with lawmakers, and the signs are the House of Commons will reject it when it’s put to a vote. All opposition parties have said they’ll oppose it, as have rank-and-file Conservatives from both the Brexiteer and Remainer wings. May’s nominal allies in Northern Ireland’s Democratic Unionist Party, which have propped up her minority government, have also said they’ll vote it down.

The DUP "wants to remain committed to the confidence and supply” deal between the two parties but it’s a "two-way street," the party’s deputy leader, Nigel Dodds, said late Wednesday in an interview on ITV’s "Peston" program. "We’ve got to warn the government that there’s two sides to this bargain.”

Conscious of the threat, May has repeatedly said rejection of the agreement could lead to either a no-deal departure -- the outcome Remainers most want to avoid -- or no Brexit at all. She was backed up on Wednesday by Chancellor of the Exchequer Philip Hammond, who told Robert Peston, ITV’s political editor, that if Parliament rejects the deal, "we will have a politically chaotic situation.”

"For those who are passionately committed to ensuring that we leave the EU on the 29th of March 2019, one of the things that they are going to have to bear in mind is the possibility that in that chaos that will ensue, there may be no Brexit,” Hammond said.

--With assistance from Charles Penty.

To contact the reporters on this story: Tim Ross in London at tross54@bloomberg.net;Ian Wishart in Brussels at iwishart@bloomberg.net;Nikos Chrysoloras in Brussels at nchrysoloras@bloomberg.net;Alex Morales in London at amorales2@bloomberg.net

To contact the editors responsible for this story: Flavia Krause-Jackson at fjackson@bloomberg.net, Emma Ross-Thomas, John Harney

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