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UK: No Brexit trade deal, no €44bn divorce bill

July 22, 2018

Britain wants the EU to agree to a post-Brexit free trade deal; the EU wants Britain to pay its financial obligations after it leaves the bloc next year. British Brexit Secretary Dominic Raab says both are linked.

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Brexit Secretary Dominic Raab
Image: picture-alliance/abaca/ANDBZ/T. Monasse

Britain might not pay a promised 39 billion pound ($51 billion, €44 billion) divorce bill to the European Union if both sides fail to reach a post-breakup free trade deal, Britain's chief Brexit negotiator hinted on Sunday.

Brexit Secretary Dominic Raab told Britain's Sunday Telegraph newspaper that EU law governing the talks required London and Brussels to negotiate their post-Brexit relationship alongside a divorce deal.

Read more: Dominic Raab is UK's new Brexit secretary

Talks on the divorce deal experienced a breakthrough in December, with Britain conceding to EU demands that it pay its remaining financial obligations after it plans to leave the bloc in March 2019.

But the EU has remained skeptical about British demands for the post-Brexit relationship, including a blueprint free trade deal proposed by British Prime Minister Theresa May in early July.

"You can't have one side fulfilling its side of the bargain and the other side not, or going slow, or failing to commit on its side," Raab said. "So I think we do need to make sure that there's some conditionality between the two."

British divisions

Raab's veiled threat was the latest sign of division within May's conservative cabinet over Britain's Brexit policy. Chancellor Philip Hammond, Britain's finance minister who favors close ties to the EU after Brexit, had previously said it would be "inconceivable" for London to not pay the bill.

Read more: EU Customs Union, Single Market, Brexit — What you need to know

May was forced to accept the resignation of Raab's hardline predecessor, David Davis, and Foreign Secretary Boris Johnson two weeks ago after they said her post-Brexit free trade deal proposal would keep Britain too close to the EU.

Raab's EU counterpart, Michel Barnier, also expressed doubts about the proposal during their first meeting on Friday.

Both sides are hoping to reach a Brexit deal by October to give national parliaments enough time for its ratification. Disagreements about the status of the border between Northern Ireland, a British territory, and the Republic of Ireland, an EU member state, have also been plaguing the talks for months.

amp/rc (AP, AFP)