The U.K. has agreed to assume up to €100 billion of EU liabilities as part of its agreement with the bloc on a Brexit divorce bill, the Financial Times reported, citing several diplomats familiar with the negotiations.
However, Britain will aim to make net payments of less than half that amount over many decades, according to the report. Negotiators are trying to come up with a net estimate of the Brexit settlement, with Britain pushing for an implied amount of between €40 billion and €45 billion, taking into account U.K. receipts and other deductions.
Britain is planning to avoid a lump-sum settlement and will instead create a system for regularly determining payments in years to come, when specific liabilities come due, the report said.
Earlier, The Telegraph reported that negotiators from the U.K. and EU reached an agreement-in-principle over the bloc's demand for a €60 billion Brexit financial settlement from Britain, a move that could unlock the next phase of talks on future trading relations.
The terms of the deal were agreed at a meeting in Brussels last week following back-channel discussions led by British chief negotiator Oliver Robbins, according to two sources of the publication.
The final figure of the divorce bill would be between €45 billion and €55 billion, depending on how each side computes the output from an agreed methodology, the report said.
The pound rose around 0.9% to $1.3367 and over 1% to €1.1271 in late Tuesday trading following the news on the agreement, according to The Independent.
With a possible breakthrough on financial settlement, the remaining hurdles in achieving progress in the Brexit negotiations would be the Northern Irish border and the role of the European Court of Justice, or ECJ, in relation to the post-Brexit rights of EU citizens in the U.K.
"The deal on the money is there; it's now the ECJ question and Northern Ireland that are the outstanding issues ahead of the Council," a senior source involved in the negotiations was quoted as saying in the report, referring to the European Council summit Dec. 14 and Dec. 15.
U.K. Prime Minister Theresa May is now expected to make Britain's offer on all three issues on Dec. 4 to allow EU chief negotiator Michel Barnier to recommend that "sufficient progress" has been made in the negotiations.
A spokesman for the U.K.'s Department for Exiting the European Union said "intensive talks" were continuing in Brussels, according to The Telegraph.