EU steps up planning for no-deal Brexit after UK gets tough

British Minister of State for International Trade Liz Truss speaking to Japan's Minister for Foreign Affairs Toshimitsu Motegi at the Department for International Trade as they formally begin negotiations on a free trade agreement. The UK has secured its first major post-Brexit trade deal after signing an agreement with Japan which will boost trade by an estimated £15 billion.

The European Union stepped up planning for a "no-deal" Brexit after the UK refused to revoke a plan to break the divorce treaty that Brussels says will sink four years of talks.

Britain said explicitly this week that it plans to break international law by breaching parts of the Withdrawal Agreement treaty that it signed in January when it formally left the bloc. It says the move is aimed at clarifying ambiguities, but it caused a new crisis in talks less than four months before a post-Brexit transition period ends in December.

Minister for Foreign Affairs Simon Coveney said the attempt to override parts of the Withdrawal Agreement is "irresponsible," "dangerous" and “eroding trust”.

"There will not be an agreement if Britain threatens to undermine previous agreements,” he told the Agricultural Science Association (ASA) annual conference in Cork yesterday.

Coveney also revealed that the Irish government received no warning about the British government's plans to overturn parts of the withdrawal agreement.

“We got nothing, no calls, no emails, no heads up, nothing.” Instead, he said they found out by reading “a headline in The Financial Times.” 

Mr Coveney said he believes the way the UK government conducted businesses this week was “a deliberate strategy to create tension” in the negotiations, in an attempt to derive some advantage for the UK on some issues they’re seeking concessions on.

“My reading of it from the EU side is that it has backfired fairly spectacularly,” he said.

Taoiseach Micheál Martin also addressed the issue saying the "uncertainty" around the Brexit situation is "particularly unhelpful" to the agricultural food industry.

“In terms of the most recent developments,” the Taoiseach said, “Europe is very steadfast in terms of its affirmation of that withdrawal treaty, and the absolute obligation on all parties including the UK, to adhere to that.”

The Taoiseach said he has been consistently pressing with British Prime Minister Boris Johnson that the optimal agreement for Ireland is a free trade one, with no quotas or tariffs.

The EU has demanded that Britain scrap the plan to breach the divorce treaty. 

"As the United Kingdom looks to what kind of future trade relationship it wants with the European Union, a prerequisite for that is honouring agreements that are already in place," said Paschal Donohoe, chairman of eurozone finance ministers.

"It is imperative that the government of the United Kingdom respond back to the call from the (European)Commission."

As the atmosphere soured between London and Brussels, Japan and Britain said they had reached agreement in principle on a bilateral trade deal that meant 99% of Britain's exports to Japan would be tariff-free.

EU chief negotiator Michel Barnier said the bloc was increasing its planning for a no-deal Brexit.

"Nobody should underestimate the practical, economic and social consequences of a 'no deal' scenario," he said.

— Additional reporting Reuters