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COM has chosen English as your language setting. Business Are petro states doomed to economic catastrophe? News Brexit: EU warns Britain of ‘unavoidable’ trade barriers if britain eu leaves customs union EU chief negotiator Michel Barnier has said Britain must decide whether to stay in the bloc’s customs union ahead of talks later this week.

British PM Theresa May earlier ruled out remaining in the customs union. Britain will face “unavoidable” trade barriers if it decides to leave the European Union’s customs union, the EU’s chief negotiator Michel Barnier said Monday after meeting British Brexit Minister David Davis in London. Barnier’s comments come after British Prime Minister Theresa May ruled out Britain’s membership of the EU customs union after it leaves the bloc and ahead of the first formal negotiations on a final deal starting Tuesday. Brexit negotiations: What are the key issues? Two phases EU leaders agreed to negotiating guidelines during a summit in April 2017 that divided the divorce talks into two phases. Phase I, in which both sides aimed to settle the basic terms of Britain’s departure, started in July and ended with an agreement on “sufficient progress” in December. Officials are now holding Phase II negotiations on the post-Brexit relationship between Britain and the EU.

The “Brexit Bill” London agreed to a formula for calculating what it owes in its “divorce bill” to the EU in early December after months of haggling by British officials. The current EU budget expires in 2022 and EU officials have said the divorce bill will cover financial obligations Britain had committed to before triggering article 50. Citizens’ rights Both sides agreed in early December that the 3 million EU citizens currently in Britain and the 1. 1 million British citizens in the EU keep their residency rights after Brexit. British courts will have immediate jurisdiction over EU citizens living in Britain. But the EU’s highest court, the ECJ, can hear cases until 2027 if British judges refer unclear cases to them. The Irish border Britain and the EU also agreed in December that no border checks between the Republic of Ireland and Northern Ireland would return post-Brexit.

How feasible the commitment will be is unclear, as Britain’s commitment to leaving the EU Single Market and Customs Union makes it difficult to avoid customs checks at the Irish border. Transition period Theresa May envisages a two-year transition period after March 2019. Both sides still have to hash out the details of the transition period in Phase II, including the exact end-date, whether new EU laws passed during the period will apply to Britain, and whether Britain can negotiate its own free trade deals. British officials hope to agree on the terms of the transition by March 2018. Trade May has repeatedly said Britain will leave the European Single Market and the EU Customs Union. Leaving both could disrupt British-EU trade, but allow Britain to negotiate its own free trade deals and restrict EU migration — key demands by pro-Brexit politicians.

London has said it wants to negotiate a new EU-UK trade deal during Phase II to minimize trade disruption before March 2019. Immigration Britain has also vowed to restrict EU migration into Britain after Brexit. However, some British lawmakers are wary that a sharp drop in immigration could lead to shortfalls in key sectors, including health, social care and construction. The EU has warned that Single Market access is out of the question if London decides to restrict the ability of its citizens to live and work in Britain.