EU to Step Up Plans for No-Deal Brexit as Bloc Plays Hardball With May

Ian Wishart, Nikos Chrysoloras and Tim Ross
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(Bloomberg) -- European leaders rebuffed Theresa May’s pleas to help her sell the Brexit agreement to a skeptical U.K. Parliament, toughening their stance as they stepped up planning for a chaotic no-deal divorce.

May had come to Brussels hoping to secure some additional "assurances" on the most controversial part of her Brexit deal -- the so-called Irish border backstop. While she made clear she wasn’t expecting a breakthrough straight away, she urged leaders to do everything they could to make the accord more acceptable at home.

But instead of giving her what she needs, leaders hardened their approach. They toughened the language of their communique, taking out some of the most helpful parts that diplomats had drafted in the run-up to the meeting. The pound fell.

“Theresa May has led a courageous fight but unfortunately we are not seeing the results," European Commission President Jean-Claude Juncker told reporters. He told May to come up with new ideas to fix the problem.

If May can’t persuade Parliament to back her plan, Britain will be on course to crash out of the club of 28 countries in just over three months’ time, unleashing political and economic chaos. Alternatively, she risks Parliament pushing her to rip up her Brexit plan, or even into a second referendum.

On Monday, May was forced to cancel a planned parliamentary vote to ratify her Brexit deal because she knew she’d lose. Two days later, she was fighting an attempt to oust her as prime minister from members of her own Conservative party dismayed at her handling of the U.K.’s exit from the EU. She survived the vote, but most of parliament still opposes her deal.

Three diplomats said May’s pitch to leaders was too vague and she failed to make them understand what exactly she thinks would work. Unusually for Brexit summits, leaders themselves got involved in redrafting the communique, and were even more pessimistic than their officials had been, one of the diplomats said.

“Our U.K. friends need to say what they want instead of asking us to say what we want,” Juncker said after the meeting. “We would like within a few weeks our U.K. friends to set out their expectations for us because this debate is sometimes nebulous and imprecise. And I would like clarifications.”

Leaders cut a line in the statement that had offered to "examine whether any further assurance can be provided" on the backstop. Still, they reiterated that they will work to avoid the backstop ever coming into effect, and to make sure that if it does it will only be temporary. They also promised to work quickly on the future trade deal.

May’s team will focus on the positive messages in the statement. According to a person familiar with the British position, EU leaders have said privately they’re not ruling out further talks.

The biggest political problem May faces with the so-called backstop guarantee for the Irish border is that it ties the U.K. into the EU’s customs regime indefinitely. That’s unacceptable to pro-Brexit Tories who want Britain to be free from European rules to strike free trade deals around the world. The Northern Irish party that props up May’s minority government also rejects it as it treats Northern Ireland differently to the rest of the U.K.

Earlier, diplomats had been working on a proposal to offer May a declaration that would have legal force to ease concerns about the Irish backstop. The idea was to call another summit in January to finalize the declaration. The plan didn’t fly, at least for now. But leaders might still get back together again next year -- and probably before Jan. 21, May’s deadline for putting her deal to Parliament at last.

--With assistance from Patrick Donahue.

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

To contact the editors responsible for this story: Emma Ross-Thomas at erossthomas@bloomberg.net, ;Heather Harris at hharris5@bloomberg.net, Richard Bravo

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