Jean-Claude Juncker deals blow to Theresa May as Tory plotting intensifies

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The President of the European Commission Jean-Claude Juncker has delivered a serious blow to Theresa May's hopes of salvaging her proposal for post-Brexit trade relations with the EU, using a major speech to warn the Chequers plan to keep the UK in a single market for goods was unworkable.

Delivering his 'State of the Union' address in Strasbourg on Wednesday morning, the Commission President underlined the EU's rejection of any plan that breaks up the key components of the single market, which guarantees freedom of movement for goods, services, people and capital.

His comments come as it was revealed that Brexiteers in the Prime Minister's party had stepped up their campaign to oust Mrs May, holding open discussions about a leadership coup at a meeting on Tuesday night if the government does not abandon the Chequers plan.

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There were reports that the government was drawing up its own exit strategy from the Chequers proposals, if the UK is able to secure a 'Canada-plus' style trade deal instead.

"We respect the British decision to leave our Union, even though we continue to regret it deeply," told MEPs and the assembled hierarchy of the EU in Strasbourg.

"But we also ask the British government to understand that someone who leaves the Union cannot be in the same privileged position as a member state.

"If you leave the Union, you are of course no longer part of our single market, and certainly not only in the parts of it you choose."

There had been hopes that EU leaders might soften their opposition to the Chequers plan when the 27 EU heads of government gather for an informal summit in the Austrian city of Salzburg next week.

EU chief Brexit negotiator fuelled speculation of a new approach to talks when he told a conference earlier this week that a deal with the UK within eight weeks was "realistic".

However, Mr Juncker's address has dampened those hopes, with Brussels remaining firm in its defence of the single market.

The EU Commission President also struck a tough line on the issue of the Irish border, the major obstacle to finalising the UK's exit treaty. Mr Juncker said the EU and its member states "will always show loyalty and solidarity with Ireland when it comes to the Irish border".

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"This is why we want to find a creative solution that prevents a hard border in Northern Ireland. But we will equally be very outspoken should the British government walk away from its responsibilities under the Good Friday Agreement," he said. "It is not the European Union, it is Brexit that risks making the border more visible in Northern Ireland."

In a sign that Brussels remains open to a post-Brexit trade deal with the UK outside the single market, Mr Juncker added that "the United Kingdom will never be an ordinary third country for us".