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Report: EU seeks to cut Britain's market access over Brexit transition breach

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Report: EU seeks to cut Britain's market access over Brexit transition breach

The EU plans to strip the U.K. of single market access during a two-year Brexit transition period if London fails to abide by the bloc's laws and agreed transition terms, the Financial Times reported, citing a leaked treaty draft from the European Commission.

The document contains a footnote stating that the final withdrawal agreement between the EU and Britain "should provide for a mechanism allowing the Union to suspend certain benefits deriving for the U.K. from participation in the internal market" if resolving disputes through the European Court of Justice, or ECJ, would take too long.

The possible suspension of Britain's single market access rights during the Brexit transition could include restrictions on cross-border financial services, airline operating rights, and free flow of goods to other EU members without customs checks, the Financial Times reported.

Britain is set to leave the EU in March 2019 and be bound by EU laws during a transition period through December 2020 without involvement in the bloc's decision-making. It would also be under the jurisdiction of the ECJ, according to the leaked document circulated to EU member states by the European Commission.

The treaty draft said the U.K. must refrain "from any action or initiative which is likely to be prejudicial to the Union's interests" during the transition period.