In the run up to the informal Salzburg summit, some in the British press predicted that there would be a breakthrough in Brexit negotiations this September. This followed, they claimed, from a significant increase in the tempo of negotiations, spurred on by the arrival of Dominic Raab as the UK’s Secretary of State for Exiting the EU. At the same time, some claimed that the UK Government’s summer strategy of appealing to EU states directly over the head of Michel Barnier, the EU’s Brexit negotiator, would pay off with a more conciliatory response from the EU27.

However, this point of view failed to take into account the position of the EU27 which has, from the beginning of the Article 50 process, been consistent. For the EU27, concluding the agreement setting out the terms of the UK’s departure from the EU was (and is) the first priority as the two-year period mandated by the Treaty draws to a close.  As we have explained in previous Brexit updates, in order for the Withdrawal Agreement to be concluded (thus ensuring a transition period and avoiding a cliff-edge Brexit in March next year) agreement must be reached on all withdrawal issues, including citizens’ rights and the so-called Irish backstop.

At times, it has seemed that the UK’s focus has been on pulling the EU into discussions on the future relationship and the Chequers proposals, and away from the difficult issue of the Irish border. The UK Government’s strategy meant that in Britain, the Salzburg summit was hyped in advance as the moment of truth for Brexit. Once in Austria, it was believed, PM May would have the chance to sell her Chequers plan directly to the heads of the EU27 governments.

In advance of the summit, the Prime Minister published an article in the German daily Die Welt stating that the EU faced a choice between her Chequers plan or no deal. She repeated her uncompromising message to heads of state over dinner at the summit itself.

EU sources were reported as stating that it was May’s intransigence that prompted leaders to speak their minds more plainly on the Chequers proposals, with French President Emmanuel Macron and European Council President Donald Tusk stating that there would be no emergency November summit without progress on the Irish border backstop.

Immediately following the Salzburg summit, PM May delivered a speech in which she acknowledged that talks had reached an impasse. In a combative speech, she clearly reiterated the UK’s negotiating red lines and stated that the two sides remained a long way from reaching agreement. She rejected the EU’s backstop proposal which would see Northern Ireland remain inside the customs union if the UK could not agree a free trade agreement with Brussels in talks on the future UK-EU relationship.

Despite the seemingly fraught state of negotiations, May’s speech did offer hope to those looking for a way forward. She stated that the UK would come forward with proposals of its own on how the backstop should be drafted. Once those proposals are put to Michel Barnier’s Commission Taskforce, a negotiation on the substance of that text can take place.

Following Salzburg, we now have a clear timeline for the conclusion of the Agreement in 2018. The EU has stated that there must be agreement on all major issues by the next European Council meeting in October if it is to convene an extraordinary summit in November to sign off on a final version of the detailed withdrawal text. This means that, for all intents and purposes, the UK and the EU have a month to agree on the Irish backstop to ensure agreement in 2018.

If this fails, it is likely that negotiations will continue into 2019. There will be time to conclude talks in the early part of next year, and institutional mechanisms can be employed to extend the time allowed for negotiations (if necessary).

The nature of EU trade negotiations means that it is likely that talks will go down to the wire. Post-Salzburg, Donald Tusk released a statement that, for many, restored faith in a compromise deal eventually being reached, when he stated that “a compromise, good for all, is still possible”. Developments in the coming weeks will go a long way towards indicating whether or how such a compromise may be achieved