UK formally rejects Brexit transition extension

The UK on Friday formally rejected the option to extend its post-Brexit transition period beyond the end of this year, leaving companies with a matter of months to prepare for more restrictive trading conditions with the EU.

UK Cabinet Office minister Michael Gove said he had “formally confirmed” the decision during talks with Brussels, stating on Twitter: “On 1 January 2021 we will take back control and regain our political and economic independence.”

With the legal deadline to request an extension to the Brexit transition period set to expire at the end of this month, Brussels said it accepted Britain’s decision as final, and that the priority must be to implement last year’s UK withdrawal treaty and unblock talks on the two sides’ future relationship.

UK prime minister Boris Johnson will hold stocktaking talks with EU leaders on Monday to assess how to make maximum use of the remaining months before what is now a hard deadline for Britain to exit the bloc’s single market and customs union.

The stance means that businesses know they now must start to prepare for a drastically different trading environment with the EU from the start of next year.

Brussels has repeatedly warned that no future relationship deal will be able to prevent the need for customs formalities, regulatory checks and animal health inspections on UK goods entering the EU single market, meaning that a hard trade border will be erected for the first time in decades.

Mr Gove confirmed the UK decision not to extend the transition period during a meeting of a joint committee of EU and British officials that oversees the implementation of the withdrawal treaty.

European Commission vice-president Maros Sefcovic, who led Brussels’ delegation on Friday’s video call, said that Mr Gove “could not be clearer”. He said the UK minister had told him that the stance reflected “the promise given to British citizens in the election campaign”.

“I take this as a definite conclusion of this discussion,” said Mr Sefcovic, noting nonetheless that he told Mr Gove that the EU “remains open to such an extension”.

Britain’s decision reflects the prime minister’s consistent position that he would never seek an extension, which under the terms of his Brexit deal with the EU could have lasted for as long as two years.

But leaders of two of the UK’s devolved administrations on Friday called on Mr Johnson to reverse course. Nicola Sturgeon, first minister of Scotland, and Mark Drakeford, her counterpart in Wales, said the lack of time left before the UK left the EU risked a “damaging ‘bare bones’ trade deal or even worse, a disastrous no-deal outcome”.

“While we hope that the second half of this year will see the beginnings of a recovery, we believe that exiting the transition period at the end of the year would be extraordinarily reckless,” they added.

“It would pile a further very significant economic and social shock on top of the Covid-19 crisis, hitting businesses whose reserves, in many cases, have already been exhausted.”

Brussels and London have confirmed over the past 24 hours that they will seek to galvanise negotiations on their future relationship in an attempt to unblock the talks and reach a deal.

The two sides on Friday published plans to negotiate every week from June 29 to July 31, with a focus on the most contentious issues, such as EU demands for a regulatory “level playing field” on state aid, labour rights and environmental law. Talks are also planned for August and September.

Mr Sefcovic said the two sides had agreed on Friday to also accelerate work to implement the withdrawal treaty, notably its provisions on avoiding a hard border in Ireland through checks on goods crossing the Irish Sea.

He added he was “very much reassured” that Mr Gove saw the need to quickly come up with plans to clarify a policy paper on the new arrangements that the UK government published last month.

“I suggested it would be extremely useful if we could get the technical clarifications by the end of this month,” he said, adding that a specialised EU-UK committee dealing with the topic would meet over the summer.

“Time is really pressing, the clock is ticking and we need tangible results in that process,” said Mr Sefcovic.

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