Theresa May reiterates: United Kingdom will leave customs union in 2020

Brexit - UK seeking previously unthought of 'third way' around the Northern Ireland customs border impasse

Mrs May acknowledged the concerns of the Irish Government would have to be dealt with so "we do not have a hard border between Northern Ireland and Ireland".

The government has promised to reduce as much as possible any border checks on goods going in and out of the European Union and avoid a "hard border" in Ireland.

The source said Britain could apply the EU's external tariffs for a limited period beyond December 2020 in the case of a delay in the implementation of any Brexit deal.

Earlier, the source, who is familiar with the discussions, said on condition of anonymity the government was trying to find a way to make the backstop arrangement more acceptable to Britain rather than seeking an extension of a transition period. "Ports operators have proved time and again that they can adapt successfully to major change - but to do so they need clarity on what changes are needed", outgoing UKMPG CEO Tim Morris wrote in a statement last month.

"UK Major Ports Group members have the systems and processes in place today that successfully handle up to 95 percent of trade coming through their ports from outside the Customs Union". But officials have warned it could take as long as five years to implement a new customs plan.

Leo Varadkar met with Mrs May in Bulgaria on Thursday as part of a Western Balkans summit in the Bulgarian capital.

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"The Customs Partnership. would appear to be the only proposal where freight is not subject to new customs controls at those ports dealing with European Union traffic", said BPA CEO Richard Ballantyne in a statement Wednesday.

When asked if that would mean Britain will be outside the EU's common external tariff and therefore able to set its own tariffs, the spokeswoman said: "We will be taking control of our trade policy".

But pro-Remain MPs welcomed signs of a compromise.

Whitehall sources last night dismissed the idea of the United Kingdom remaining shackled to the customs union long term.

Extending the use of European Union tariffs is part of discussions to make the backstop arrangement more palatable to Britain, and could be triggered if there were a delay in the ratification of the Brexit deal or if there were problems introducing new technology at the border, the source said.

Downing Street said the flagship EU Withdrawal Bill would return to the Commons in "weeks not months".

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