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After nine months of gruelling negotiations, high profile compromises and a bill of €40-60bn, Britain’s carefully laid plans for a Brexit divorce deal came unstuck on Monday over a single word: alignment.

The compromise hammered out related to a common goal: how to uphold the peace process in Northern Ireland and avoid border controls with the Irish Republic, even if the UK left the EU without a trade deal. Negotiators chose the phrase “regulatory alignment” — suggesting that similar rules and regulations could allow cross-border trade to continue unimpeded — because the words offered enough wiggle-room for both Dublin and London to claim it as a success.

But the provision was vetoed by Arlene Foster, the leader of the Democratic Unionists, the Northern Irish party that provides UK prime minister Theresa May with her parliamentary majority.

The wording on alignment had offered reassurance to Ireland, which argues that any substantive difference in rules from the EU’s single market and customs union would inevitably lead to a hard border on the island. Dublin has sought guarantees that no such border will be reintroduced.

At the same time, the reference allowed London to reject Ireland’s previous demand for “no regulatory divergence”, a less ambiguous phrase that implies that after Brexit Northern Ireland would move in lock step with the single market and customs union. To London alignment suggested that “parallel” regulatory regimes would be possible on the island of Ireland.

By Monday morning, senior Irish officials believed the two sides had reached the point of a “done deal”. All that remained was for Mrs May to give her formal endorsement of the text to Jean-Claude Juncker, the European Commission president, over lunch. “We had been told it was signed and sealed,” said one person close to the talks.

What happened subsequently underlined that for Unionists and Brexiters the question of whether rules should be “aligned” post-Brexit — or prevented from diverging at all — goes to the core of what kind of Brexit the UK will pursue.

Downing Street stressed that the compromise with Dublin was specifically related to the 1998 Good Friday Agreement, which ended three decades of violence and includes provisions on regulatory co-operation on the island of Ireland for sectors such as agriculture, waterways and energy.

Those efforts were always underpinned by a common framework — the EU customs union and single market — raising questions over what the foundation for co-operation would be after Brexit.

In a hint of how “alignment” may carry different meanings for different audiences, James Brokenshire, Britain’s secretary of state for Northern Ireland, has said that it may be possible for the province to “adopt substantially the same regulations on, for example, the agri-food sector” as the Republic.

This could allow the co-ordination of policies across the island to help avoid a hard border, but under parallel regimes.

British ministers acknowledge that there are already differences in food rules and regulations between the island of Ireland and Britain. Some EU officials note that it means checks are even required on some imports crossing the Irish Sea.

As the Brexit negotiations move to trade issues, the implications of alignment may become more clear. Sir Peter Ricketts, a former British ambassador to Paris, tweeted: “If we concede ‘regulatory alignment’ in Ireland, and there can be no border within the UK, then surely this dramatically curtails scope for UK free trade agreements with others like US?”.

One European official involved in Brexit talks said the compromise entailed a “suspension of reality” where both sides imagined the words meaning different things in practice.

But for the DUP the symbolism of the word appeared too much like putting up barriers with Britain. “We will not accept any form of regulatory divergence which separates Northern Ireland economically or politically from the rest of the UK,” said Mrs Foster.

The debate in Brussels on Monday sharpened the looming debate about what kind of trading relationship the UK will have with the EU after Brexit.

Mrs May’s decision to make Northern Ireland a special case in her Brexit negotiation provoked immediate demands from Scotland and London that they should be allowed to forge their own relationship with the EU.

Scotland, which like Northern Ireland voted to stay in the EU in last year’s referendum, has long argued it should be allowed to stay in the single market after Brexit.

Nicola Sturgeon, Scotland’s first minister, said: “If one part of UK can retain regulatory alignment with EU and effectively stay in the single market (which is the right solution for Northern Ireland) there is surely no good practical reason why others can’t.”

Sadiq Khan, the pro-EU mayor of London, also noted the “huge ramifications for London” of Mrs May’s offer. He wants the capital, which voted 60-40 to remain in the EU, to have its own immigration policies.

Additional reporting by Arthur Beesley in Dublin


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