The EU is examining the possibility of giving further guarantees to London in relation to the controversial backstop plan for the Irish Border, in an attempt to make a breakthrough in the Brexit talks.
The compromise would involve giving firmer assurances to the UK about the prospect of it as a whole remaining in a customs union with the EU for a period after Brexit.
However, EU and Irish sources say the original EU plan for the Irish backstop must also remain in the withdrawal agreement as a final fail-safe, a proposal so far rejected by London and opposed by the DUP.
The backstop – the guarantee that no matter how future trade talks between the EU and UK go there will be no hard border on the island of Ireland – is now the key blockage to finalising a withdrawal agreement to allow the UK to leave the EU in an orderly fashion.
London has objected to the EU plan for a backstop, which would see Northern Ireland effectively remaining in the EU trading bloc after Brexit. This would entail new checks on goods crossing between Britain and the North.
Customs checks
To limit this problem, London had put forward the idea that the whole of the UK would remain in the customs union for a period after Brexit. This would remove the need for customs checks between the North and Britain, though regulatory checks in areas such as animal health and food safety would still be needed.
The EU had been willing to discuss this, but had so far insisted that it could only be finalised after the UK leaves the EU, as the future shape of the relationship between the two sides is fleshed out.
A report in the Financial Times suggests that the EU may now be prepared to go a bit further and may include some outline details of the proposed EU-UK customs union in the formal withdrawal agreement.
Level of detail
It is not clear, however, what level of detail the EU would be prepared to include in the withdrawal agreement.
Sources say that the negotiating mandate for the EU team has not changed, with some member states likely to insist that the UK cannot be guaranteed any arrangement allowing it access to EU markets without following the rules.
A number of sources also confirmed that the EU would continue to insist that its original backstop plan remained in place as a final insurance policy.
The whole area of the backstop remains very difficult for the Conservative government, facing objections by the DUP to any new checks on trade between Britain and the North.
Also many Conservatives will object to any arrangement which could tie the UK to the EU trading bloc for a prolonged period and limit its ability to negotiate new trade deals with third countries.
