REPEAT: EP Negotiator Says Sufficient Progress Unlikely By Oct

Repeats Story Initially Transmitted at 21:30 GMT Aug 30/17:30 EST Aug 30

--EP Brexit Coordinator Wants More UK Position Papers 

--Transition Widely Accepted, Likely More of Same, Verhofstadt Adds

--Updates With Further Background

By Tara Oakes

     BRUSSELS (MNI) - The European Union's key Brexit benchmark of "sufficient

progress" is unlikely to be met by October if negotiations continue at the

current rate, EU negotiator Guy Verhofstadt said Wednesday.

     "There is slow progress in general," Verhofstadt, chief negotiator for the

European Parliament, told the EP's Employment committee.

     Three areas need to be given the green light on "sufficient progress" by

the EU before talks on the future relationship can be launched in tandem: the

divorce bill, citizens' rights and issues relating to the island of Ireland. The

bloc have not specified what constitutes this elusive title, but the target is

October.

     "We're not expecting breakthroughs but progress on these issues,"

Verhofstadt said of this week's round of negotiations, which began on Monday and

wrap up Thursday.

     Verhofstadt, who said it was "very difficult" to see the benchmark being

hit at the current pace, added that he welcomed the increasing UK acceptance of

the need for a transition deal.

     "No deal is no longer an option," Verhofstadt told the committee, adding

that a transition looked increasingly like it would have to be a "continuation

... of the status quo".

     But UK Prime Minister Theresa May, asked on the BBC earlier Wednesday

whether she still thought no deal was better than a bad deal, said "Yes".

     NEXT STEPS

     Verhofstadt told attendees in Brussels that he hoped to present a

resolution to the European Parliament on October 3 on Brexit talks to assess

"what is acceptable and what is not acceptable". The EP must ultimately approve

any withdrawal deal struck by the UK and the European Union.

     He again dashed UK hopes of speeding up parallel talks to put any future

relationship on the table sooner rather than later, saying that the current

timetable would be adhered to. The EU's main negotiator, the European

Commission's Michel Barnier and EC President Jean-Claude Juncker have said the

same thing this week -- despite the publication of hopeful UK position papers on

future relations.

     The EU's hands are tied on increasing pace on future relationship talks by

their approved mandate, although it is understood that it has occasionally

bubbled up in negotiations, only to be batted away.

     MORE UK PAPERS

     Although he recognised the new stack of documents, Verhofstadt called for

more position papers on all subjects from the UK side. Barnier, echoed his

sentiments in a tweet on Wednesday.

     "Negotiations ongoing: EUCO guidelines are designed for serious and

constructive negotiations, but we need clear UK positions on all issues,"

Barnier tweeted.

     Although the UK side are yet to publicly publish a position paper on the

financial settlement, it is understood that they presented a 47-paragraph,

11-page legal analysis document to their EU counterparts during three hours of

negotiations on Tuesday.

     Britain has acknowledged it has obligations to the EU upon withdrawal, but

a sticking point is believed to be where the legal obligation to pay stems from.

     While the EU state in their position paper that this is derived from the

UK's approval of the 7-year Multiannual Financial Framework (MFF) and the Own

Resource Decision (ORD), it is understood that UK are arguing that it is only on

approval of the EU annual budgets that member states have legal obligations.

     PM May, who had hoped for progress on trade talks during her visit to

Japan, told the BBC Wednesday that more documents were in the pipeline for

Brexit negotiations.

     "There will be more papers to come, where we are setting out the key issues

that both sides need to address and the options we have, the ideas we have, of

how to deal with those," May said.

     "It's the United Kingdom that been coming forward with the ideas and with

the clarity about the future," she added.

     Verhofstadt told the audience that he respected the vote as the sovereign

right of the British people, but wryly noted the economic and financial

consequences hitting markets since the referendum result.

     "I only see what the pound sterling is doing, I only see that inflation is

going up, I only see that some political parties have doubts about the economic

consequences," he said.

     But there was one boon for the bloc, according to the MEP: the EU is

reaping the benefits in terms of increased unity in the wake of Britain's

unexpected breakaway.

     "My impression is that it has created more unity than whatever campaign has

been launched by the European Union," Verhofstadt said.

     If sufficient progress isn't declared in time, there might be disquiet from

the EU ranks as well as the UK about their respective negotiating teams. Neither

side have ruled out the introduction of new negotiating weeks before October to

make progress on areas of deadlock - but the timetable is already tight.

--MNI Brussels Bureau; +44 203-865-3851; email: tara.oakes@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com