The EU believes Theresa May will now accept a soft Brexit

Simon Dawson – WPA Pool/Getty ImagesBritain’s Prime Minister Theresa May
  • Exclusive: The European Parliament’s chief Brexit negotiator believes Theresa May will erase her red lines and lead Britain to one of the softest forms of Brexit.
  • Guy Verhofstaft told MEPs this week that he expects Britain to stay in the single market and in a customs union with the EU, in what is being called “Norway plus plus” in Brussels.
  • Verhofstaft is set to discuss this Brexit model with MPs in Westminster next week.
  • Negotiations remain at an impasse over the Irish border.

LONDON – The European Union now believes Theresa May will ditch her Brexit red lines and deliver a soft Brexit inside the single market and customs union, according to the European Parliament’s chief Brexit coordinator Guy Verhofstaft.

Speaking privately to British MEPs ahead of a trip to the UK next week, Verhofstadt said he believed Britain will remain wedded to the European Union’s trade, customs and legal rules after Brexit.

This form of Brexit – known in Brussels as “Norway plus plus” – would see Britain remain fully aligned to the single market by staying in the European Economic Area and maintaining a customs union with the EU. This means it would maintain full access to the single market but would not be able to sign its own free trade deals.

This new relationship would be overseen by judges in the EFTA court, who currently handle legal matters relating to member states who are in the EEA via the European Free Trade Association – Norway, Lichenstein and Iceland.

Verhofstadt, who heads the Parliament’s Brexit taskforce, is scheduled to appear in front of both the Home Affairs and Brexit committees next week. He is also due to have dinner with the UK’s Brexit Secretary, David Davis.

However, he will also use his trip to brief MPs on a so-called “Norway plus plus” arrangement, amid a growing feeling in both Brussels and Westminster that Britain is headed for a much closer post-Brexit relationship with the EU than previously expected.

A source close to Verhofstadt told BI: “We hope for the closest relationship possible given the UK’s red lines.”

His comments follow those of Michel Barnier, the EU’s chief Brexit negotiator, who told a meeting of Green MEPs this week that it would be possible for Britain to stay in the EEA and maintain a customs union with the EU after Brexit.

Verhofstadt made his prediction to a cross-party collection of British MEPs in Brussels this week, which included Labour’s Seb Dance and Lib Dem Catherine Bearder, among others. He is set to discuss the matter further in a private meeting with British MPs when he visits Westminster next week.

Verhofstadt has previously called for the EU offer Britain an association agreement, which would allow for a closer but more flexible relationship than what the European Commission is currently offering.

The Belgian’s latest comments are another indication that Brussels believes Theresa May would be prepared to erase her strict negotiating red-lines in order to make a breakthrough on the issue of the Irish border.

The UK prime minister has proposed that Britain could remain in a customs union with the EU as part of a backstop plan, which would take effect if negotiations on future trade fail to preserve the frictionless border.

However, the EU has warned May that Northern Ireland must remain fully aligned with the single market as well as the customs union in order to eliminate checks between Northern Ireland and the Republic.

This week MPs voted down an amendment which sought to keep Britain in the EEA – aka the Norway model. They also voted down an amendment which would have forced May to pursue a customs union with the EU.

However, with Brexit talks at an impasse and time running out to find a deal, EU figures believe the UK side will be forced to soften their position and settle for a closer relationship with the EU than May had originally set out.

The EU will assess the state of negotiations at the European Council’s next summit at the end of this month.

NOW WATCH: Briefing videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.