Jean-Claude Juncker has dealt a fresh blow to the credibility of the Chequers plan by rejecting Theresa May’s proposals to maintain frictionless trade after Brexit.
The European Commission president struck an upbeat tone on post-Brexit relations in his annual state of the union speech, saying the UK will “never be an ordinary third country for us.”
But he came out strongly against the prime minister’s plan to keep trade flowing and avoid a hard border in Ireland after Brexit by effectively keeping the UK in a single market for goods.
“We respect the British decision to leave our union, even though we continue to regret it deeply,” Juncker told MEPs in Strasbourg.
“But we also ask the British government to understand that someone who leaves the Union cannot be in the same privileged position as a member state.
“If you leave the union, you are of course no longer part of our single market, and certainly not only in the parts of it you choose.”
Juncker said instead that the Chequers plan was a “good starting point” for a free trade agreement.
His position was welcomed by UKIP’s Nigel Farage, who had earlier given Juncker a pair of union jack socks to mark the occasion.
“You said our vote to leave was a vote to leave the single market and its associated parts – I agree with you,” said Farage.
“Why Mrs May at Chequers wants to opt back into much of it I don’t know.”
The Chequers plan includes a proposal for the UK to accept EU rules on goods in order to avoid border checks and maintain the ‘just in time’ supply chain which many businesses depend on.
The EU believe that allowing the UK to benefit from the free movement of goods without accepting the free movement of capital, services and labour would lead to calls for other countries for bespoke deals and ultimately bring down the single market.
UK negotiators insist the proposal is not a threat to the single market and are continuing to push the idea, along with a customs arrangement that would see the UK act as if it were in a “combined customs territory” with the EU.
As well as being beneficial for trade, the UK government say it is crucial for avoiding a hard border in Ireland – the major issue holding up the Withdrawal Agreement.
On Ireland, Juncker said he was open to a “creative solution” to avoid a hard border but added that the EU’s “loyalty and solidarity” will always be with Ireland on the issue.
And he said: “It is not the European Union, it is Brexit that risks making the border more visible in Northern Ireland.”
Far from dominating the EU’s agenda, Brexit was the last major issue to be addressed in Juncker’s hour-long speech which he delivered mainly in French and German and centred on dealing with migration, terrorism and global trade.
He did though make some thinly-veiled digs over contentious Brexit issues, such as on the EU’s Galileo satellite project.
The UK have threatened to claw back its £1bn investment and set-up a rival system if it’s not allowed full access to Galileo after Brexit.
Juncker insisted that no single member state could have created Galileo alone, saying: “Without Europe there would be no Galileo.”
The address is likely to be Juncker’s last before his term as commission president ends next year.
Manfred Weber, the leader of the European Parliament’s centre-right group and a potential successor to Juncker, said of Brexit talks: “Europe is united and ready for a deal but London cannot give us clear answers. So the EU is united and London is in trouble.”