Barnier says EU will not compromise standards in future UK trade deal

The EU’s chief Brexit negotiator, Michel Barnier, has said that any move by a British government to abandon European-style policies will complicate the agreement of a post-Brexit trade deal in national and regional parliaments across the bloc.

The EU was ready to offer the UK the “most ambitious” partnership on trade possible, he said, but was not going to compromise its standards on fair competition, tax, labour law, environmental and food safety.

Barnier said: “The UK has chosen to leave the EU. Does it want to stay close to the European model or does it want to gradually move away from it? The UK’s reply to this question will be important and even decisive because it will shape the discussion on our future partnership and shape also the conditions for ratification of that partnership in many national parliaments and obviously in the European parliament. I do not say this to create problems but to avoid problems.”

A future EU-UK trade deal would have to be agreed unanimously by the EU’s 27 governments, the European parliament and potentially at least 35 national and regional parliaments.

Speaking to a Brussels audience at a Centre for European Reform conference, Barnier said the UK would have access to the single market, but stressed this was not equal to membership. “The UK will lose the benefits of the single market. This is a legal reality,” he said. “It simply draws the logical consequence of the UK’s decision to take back control.”

British firms, he said, would lose their financial service passports, which enable banks and institutions in the City of London to reach a market of 500 million consumers and 22m businesses.

Peter Mandelson, the former secretary of state for business and EU trade commissioner, appealed to the EU to offer Britain a trade deal as ambitious as the now-stalled TTIP deal that had been proffered to the US.

“Canada is not the last word on trade agreements,” he said, suggesting the EU could go further than its free-trade deal with Canada. Mandelson said the British government was “a horribly difficult and dysfunctional negotiating partner” but would remain “the most important relationship with the EU on its doorstep by a large margin”.

The UK would pay the price for divergence from EU standards, Mandelson said, adding that many Brexiters would be “very happy for the UK to become a regulatory satellite of the US”, while “some in the present cabinet barely know what a trade negotiation is, let alone why it is desirable”.

The EU has set the UK a deadline of early December to improve its offer on the Brexit divorce bill. The UK must also make “sufficient progress” on agreeing the status of citizens’ rights, the EU budget settlement and the Irish border before it is allowed to begin trade talks.

The Irish issue has emerged as an uncertain factor in talks, after Ireland said it would veto an agreement in December without a formal written guarantee there would be no hard border.

Barnier said he expected the UK as a co-guarantor of the Good Friday agreement to come up with proposals to avoid a hard border, remarks that underline the fact he does not see the British government’s calls for “imaginative” technological solutions as serious.

John Bruton, a former Irish prime minister, urged the UK to stay in the customs union, while lambasting the British political class for not taking the issue seriously during the referendum. “It is quite remarkable that the Good Friday agreement is being taken more seriously by French, Italian and German politicians than it is by British politicians,” he said.