The Irish border remains a critical policy area where both sides of the negotiations fail to agree, along with citizens’ rights and the Brexit divorce bill.
It had been thought the issue of how to avoid a hard Irish border when Britain leaves the EU single market and customs union had been set aside until further progress was made on the future trading deal between Britain and Brussels, given the interlinked nature of the relationship.
However, the leaked document now reveals Dublin wants concrete assurances about the future of the Irish border before any trade talks can go ahead.
The news will come as a bitter blow to Theresa May and the UK Government, who are keen to move on to trade discussions as soon as possible in order to allay businesses’ fears about the post-Brexit future.
The one-page European Commission paper, dubbed ‘Dialogue on Ireland/Northern Ireland’ and seen by the Telegraph, says that in order to preserve the Good Friday Agreement peace deal, the Brexit divorce deal must take into account “the integrity of the internal market and the customs union”, given Ireland’s continued membership.
The Irish foreign minister Simon Coveney has also admitted there “is a way to go” on the border issue before talks can turn to trade.
Asked if Ireland will veto moving on to the next stage of Brexit talks, Mr Coveney gave no assurances and simply said talk of individual member states vetoing the decision to move forward was “not helpful at this stage”.
The leaked document concludes the UK must ensure “no emergence of regulatory divergence” from the rules of the EU single market and the customs union which are “necessary for North South co-operation, the all-island economy and the protection of the Good Friday Agreement”.
Dublin is reportedly urging Britain to agree to adhere to around 100 EU rules and regulations to ensure an open trade border between Northern Ireland and the Republic of Ireland post-Brexit.
The demands either increase the risk of a ‘special status’ in the EU for Northern Irish citizens, or require Britain to remain in the single market and customs union – presenting Mrs May with an impossible decision.
A spokesman for the department for Exiting the European Union (DexEU) reiterated its plans to avoid a hard Irish border but maintained Britain is still hoping to leave the single market and customs union.
He said: “We recognise that the solutions to the unique circumstances in Northern Ireland must respect the integrity of the EU single market and customs union. But they must also respect the integrity of the United Kingdom.
“The Government is determined to find specific solutions to Northern Ireland’s unique circumstances, not least as the only part of the UK to share a land border with an EU member state.”
The news comes despite the fact that Irish Taoiseach Leo Varadkar said he was confident Brexit talks would turn to trade at the EU summit next month.
Mr Varadkar told the Irish parliament: “I‘m now of the view that it is likely that we will be able to say that sufficient progress has been made at the December (EU leaders) meeting, allowing us to move onto discussions on transition and the future arrangements, but that’s just my prediction at this stage.
“This of course will all depend on what happens over the next number of weeks and what specific assurances and guarantees in writing we can get from the United Kingdom.”
The Irish leader revealed he was more optimistic about the state of Brexit talks than he had been, claiming he thinks talks are “moving in the right direction”.
The Irish border remains a bone of contention among officials in Dublin who are keen to avoid the prospect of a “hard” border – but Mr Varadkar believes this will be resolved when talks move on to the future relationship between Ireland and Britain.
He said: “It’s not going to be possible to fully resolve the border question until we actually start to talk about the future relationship the UK will have with Northern Ireland so there will come a point when it is in our interests to actually start talking about that.”