Rules row looms for May over transition period

The position set out by Michel Barnier would make the application of new EU rules a condition of a transitional deal, meaning Britain could be subject to further Brussels’ regulations for about two years after leaving the bloc.

May hopes to secure an implementation period between the UK’s formal exit date and the commencement of any post-Brexit trade deal in order to give businesses time to adjust to the new arrangements, but accepting the imposition of new rules could trigger a revolt by Eurosceptics.

It would also go against the approach to an implementation period set out by the Prime Minister in her Florence speech, where she said the ‘framework for this strictly time-limited period … would be the existing structure of EU rules and regulations’.

The revelations came as Ireland’s European Commissioner Phil Hogan urged Theresa May to change course and commit to staying in the customs union and single market – or at least allow Northern Ireland to do so.

Hogan’s comments came after May’s DUP allies issued a warning that they would not tolerate any attempt to put barriers between Northern Ireland and the rest of the UK after Brexit.

The Prime Minister has been given until December 4 to come up with further proposals on issues including the border, the Brexit divorce bill and citizens’ rights if European leaders are to give the green light to moving on to the next phase of negotiations covering the future relationship between the UK and Brussels.

Hogan, the EU’s agriculture commissioner, said it was a ‘very simple fact’ that ‘if the UK or Northern Ireland remained in the EU customs union, or better still the single market, there would be no border issue’.

In a swipe at the Government’s approach to Brexit he added: ‘I continue to be amazed at the blind faith that some in London place in theoretical future free trade agreements.’