Theresa May is clinging to her Chequers plan like a drowning woman holding on to a waterlogged lifebuoy. Nobody thinks she has realistic chance of saving herself, each side of the Brexit debate rejecting the plan for their own diametrically opposite reasons. Her plan is a compromise only in the sense that both wings of her party are equally opposed to it. The EU haven't officially rejected it so far, although Barnier has pointed to several areas that are not acceptable. One of these is the offer by the UK to collect EU tariffs in what is called a facilitated customs arrangement (FCA). The EU say they cannot allow that and a report (HERE) on Reuters shows why.
There is a coming legal battle between the UK government and the Commission about £2 billion in tariffs on Chinese goods that were unpaid in a sophisticated import scam.
The Commission claim this is money owed by the UK government who were responsible for its collection. The UK government responds by saying they don't "accept liability for the alleged losses or recognise the estimate of alleged duty evaded. We take customs fraud very seriously.”
Politically, this could not have come at a worse time for both sides and yet it will play out as the Brexit negotiations go down to the wire and it may have a big impact on the final agreement.
