LONDON — Prime Minister Theresa May’s office on Sunday dismissed as speculation reports that Britain and the European Union were close to striking a divorce deal after reaching a compromise on the intractable issue of the Irish border.
Downing Street said “negotiations are ongoing” and that a Sunday Times report claiming a proposed agreement had been reached on future customs arrangements at the Ireland-Northern Ireland border was “speculation.”
However, U.K. and EU officials have said in recent days that a deal is getting closer and could be sealed this month.
May’s deputy, David Lidington, said Friday that negotiators were “very close” to an agreement. Irish Deputy Prime Minister Simon Coveney said “I think it is possible to get a deal in November.”
Britain is due to leave the EU on March 29, but London and Brussels have not reached an agreement on their divorce terms and a smooth transition to a new relationship. The stalemate has heightened fears that the U.K. might leave without a deal in place, leading to chaos at ports and economic turmoil.
An October EU summit that had been billed as the deadline for a breakthrough ended with the talks still deadlocked.
The key obstacle is the Irish border, which will be the U.K.’s only land frontier with the EU after Brexit. Britain and the EU agree there must be no customs posts or other barriers that could disrupt businesses and residents on either side or undermine Northern Ireland’s hard-won peace process.
But the two sides have not agreed on how to do that. Britain rejected the EU’s proposal — to keep Northern Ireland in a customs union with the bloc — because it would impose new customs and regulatory checks between Northern Ireland and the rest of the U.K.
According to the Sunday Times, a proposed solution would keep all the U.K. in a customs union — but with an exit clause to mollify pro-Brexit British lawmakers who worry the U.K. will be bound to the EU forever.
May faces a battle to get a deal approved by her Cabinet — which is split between supporters of a clean break with the EU and those who want to keep close economic ties to the bloc — and past an equally divided Parliament.
May has already lost two top ministers, Boris Johnson and David Davis, over her Brexit blueprint. Others could follow in a bid to make her change course. And pro-Brexit Conservative lawmakers have openly mulled attempting to oust May with a no-confidence vote and a party leadership contest.
So far, the prime minister has stood her ground and her opponents have blinked.
With the clock ticking, opponents of Brexit are stepping up efforts to secure a new referendum on whether to accept any deal agreed between Britain and the bloc.
Britain voted in 2016 to leave the EU, but some argue the public should get a second chance to decide once the shape of the U.K.’s future relations with the bloc is clear.
More than 70 British business leaders signed a letter published Sunday urging a second vote, arguing that the conditions proposed by the government for associating with the EU after Brexit are “not nearly as good as the current deal we have inside the EU.”
Signatories included James Daunt, chief executive of the Waterstones book store chain, former Sainsbury’s supermarket CEO Justin King and Martha Lane-Fox, founder of Lastminute.com.
Meanwhile, one of the main funders of the successful pro-Brexit side in the 2016 referendum is facing a criminal investigation.
The National Crime Agency is investigating insurance tycoon Arron Banks after electoral officials alleged that 8 million pounds ($10.4 million) he funneled to a pro-Brexit group might have come from outside the U.K., in violation of election laws.
A British parliamentary committee is also investigating Banks’ role in the referendum and his meetings with Russian officials.
Banks denied wrongdoing Sunday, accusing anti-Brexit politicians and journalists of pursuing a “witch-hunt” against him.
“The money came from a U.K.-registered company … generated from businesses in the U.K.,” Banks told the BBC.
“There was no Russian money and no interference of any type,” he said.
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