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By Gabriela Baczynska and Alastair Macdonald
BRUSSELS, Dec 5 (Reuters) - Theresa May must deliver her offer on a Brexit divorce package this week if she wants European Union leaders to grant Britain’s request for talks on future free trade when they meet next week, EU diplomats and officials said on Tuesday.
Failure could mean a delay until February, adding to the risk of businesses scaling back investment plans in Britain as uncertainty clouds the outlook beyond Brexit in March 2019.
“The ‘deadline of deadlines’ is this week,” one senior EU diplomat said, a day after the prime minister had to leave Brussels empty-handed when her Northern Irish allies denounced an offer on the border with Ireland as she was presenting it.
May has found it difficult to come up with a formula that satisfies both EU member Ireland, which wants to avoid creation of a “hard” border, and Northern Ireland’s DUP party which says the British province must quit the EU on the same terms as the rest of the UK.
A tentative deal on the border, promising “regulatory alignment” on both sides of the island of Ireland, was agreed on Monday. But it was later rejected by the DUP which says it can not allow any divergence in regulation between Northern Ireland and other parts of the UK.
Brussels officials said they had no reason to doubt the confidence being expressed in London that May would sort out the hitch in the coming days and expect her to return to brief EU Brexit negotiators as early as Wednesday.
But, they warn, other member states, including powerhouses Germany and France, are growing nervous that they will not have enough time to scrutinise draft guidelines for the trade negotiations if they do not receive them a week before a summit next Friday at which leaders would approve them.
“If a proposal doesn’t come this week, the EU 27 won’t have enough time to prepare new guidelines for the summit,” the diplomat said.
Some leaders had already grumbled that the deadline missed on Monday was too tight. And if governments refuse to sign off on proposals for what the EU should seek in a post-Brexit free trade deal with London, then May’s hopes of being able to show those guidelines at home as a trophy won in exchange for giving in to most of the EU’s divorce demands would be thwarted.
If the trade offer cannot be made at the Dec. 15 summit, a senior EU official said, the whole process might have to be put back until February - a delay which could increase pressure at home on May and raise a risk of disrupting the existing process.
Summit chair Donald Tusk said on Monday he had been planning to distribute his draft negotiating guidelines to member states on Tuesday, had the EU executive’s negotiator Michel Barnier given the crucial signal that Britain had made “sufficient progress” on three key elements of the divorce.
Bound by previous EU internal agreements not to share the draft until May has formally committed Britain to covering outstanding EU payments, guaranteeing EU citizens’ rights and an open border for Northern Ireland, Tusk must now wait until May returns and EU negotiator Michel Barnier has signed off a deal.
The guidelines, which are likely to include a commitment to the two-year, status-quo transition period May asked for, will then be scrutinised closely in EU capitals. The other 27 have held a common front on making Britain pay for past commitments, but all have varying interests in a trade deal and so will want time to ensure the guidelines defend their own positions.
Leaders’ advisers, known as “sherpas”, meet in Brussels in Monday to prepare the summit. The less time they have to digest Tusk’s draft negotiating guidelines, the shorter and less detailed those are likely to be, said EU officials who expect a further more detailed set of guidelines to be prepared later. (Additional reporting by Jan Strupczewski; Editing by Mark Heinrich and Richard Balmforth)