Northern Ireland could remain an effective member of the customs union and the single market as part of the UK’s Brexit deal with the EU it has been claimed.
But the Democratic Unionist Party (DUP) has said it will not accept any agreement that “separates” Northern Ireland from the UK.
Theresa May is holding crunch talks in Brussels today in order to hammer out a deal on the Northern Ireland border, citizens’ rights and the UK’s divorce bill.
The EU has refused to progress talks to phase two, negotiations on a future trade relationship, until those three issues are settled.
Belgian MEP Philippe Lamberts said on Monday the draft text of the deal expected to be agreed on Monday would see almost “full alignment” between Northern Ireland and the Republic of Ireland.
The Irish government has said it will block any deal that leads to physical checks on the border amid fears it could endanger the Good Friday Agreement.
But such a deal could effectively see the EU border erected in the Irish Sea between the island of Ireland and mainland Britain.
Arlene Foster, the DUP leader, appeared to pour cold water on the suggested deal.
“We will not accept any form of regulatory divergence which separates Northern Ireland economically or politically from the rest of the UK,” she said.
“Northern Ireland must leave the EU on the same terms as the rest of the United Kingdom”.
Lamberts had told Sky News: “The British government would commit to maintain full alignment of legislation, where pertinent of course, so single market and customs union legislation, that might potentially create a border, will remain fully aligned so there is not.”
He added: “That’s the only solution if you want to keep the Good Friday Agreement.”
The draft text of the agreement seen by RTE states:
“In the absence of agreed solutions the UK will ensure that there continues to be no divergence from those rules of the internal market and the customs union which, now or in the future, support North South cooperation and the protection of the Good Friday Agreement.”
Shortly after the reports emerged, Downing Street said May would not agree to any deal that led to an economic border between Northern Ireland and the rest of the UK.
“The prime minister has been clear that the UK is leaving the EU as a whole, and the territorial and economic integrity of the UK will be protected,” spokesperson for the prime minister said.
Lord Trimble, the former Northern Ireland first minister and leader of the Ulster Unionist Party, told the BBC Radio 4′s World at One programme the agreement was “potentially very bad news for Northern Ireland”.
“That would put Northern Ireland businesses at a huge disadvantage and this isn’t just a minor thing - 80% to 90% of Northern Ireland’s business is done with and through the rest of the United Kingdom,” he said.
“So it’s that 80% to 90% that is going to be harmed by being clip-locked into European regulation while other people are free from that and the country as a whole is free to work out what it’s regulatory provisions are.”
Nigel Farage said any deal that saw Northern Ireland left with a so-called softer Brexit than the rest of the UK was a “betrayal”.
The prospect of Northern Ireland remaining an effective member of the customs union and single market also caused Nicola Sturgeon and Sadiq Khan to question why Scotland and London could not do the same.