The European Union expects the U.K.’s post-Brexit transition period to last until the end of 2020 and is aiming for a trade deal to kick in immediately after that, according to a European Commission official.
“The end of 2020 seems like a natural end-point for the implementation period or transition,” Stefaan De Rynck, senior adviser to chief EU negotiator Michel Barnier, told an audience at the Chatham House think tank in London on Monday. “Our goal would have to be to make sure that the future relationship is indeed in place in January 2021 if the transition were indeed to end at the end of 2020.”
The U.K. wants a transition period after it leaves the EU in March 2019 to give certainty to businesses about what rules they’ll be operating under. It would also give more time for the two sides to negotiate a full-blown trade agreement.
The British government argues that a trade agreement can be negotiated before the transition phase even starts, but De Rynck poured cold water on this. Instead, the EU expects to publish a declaration to sit alongside the Brexit agreement outlining the main points of the future relationship.
Negotiations between the U.K. and EU over the transition phase won’t start until January and securing such an arrangement “isn’t a given,” De Rynck said. Even if the two sides agree on the transition terms early next year, it won’t be confirmed until the full Brexit deal is ratified, he said.
The EU will insist that the U.K. remains fully signed up to single market and customs union rules during that time but he hinted that there might be a way for the U.K. to technically leave these arrangements while remaining bound by their principles — something that Theresa May’s government has signaled that it plans to do.