Northern Ireland will effectively remain in the EU customs union and adhere to single market rules to avoid a hard border post-Brexit if no deal or alternative plan is agreed, the draft withdrawal agreement will state.
EU sources said that the proposed agreement from Brussels covering the UK's withdrawal from the union - due to be published by Brussels on Wednesday - will maintain a common regulatory area on the island of Ireland.
This will be triggered should the EU and the UK not agree a solution for the Border post-Brexit in the overall withdrawal deal and London fail to propose an alternative arrangement.
The EU's draft text will be subject to negotiation with the UK government.
The delicately-crafted text provides a legal foundation to the December agreement, including its third and final “backstop” option guaranteeing regulatory alignment north and south of the Border.
The focus of the draft agreement will be on this option given that the first two - a future EU-UK trade agreement and a specific solution proposed by London - are dependent on Conservative prime minister Theresa May’s government proposing solutions that have as yet, not been forthcoming.
Legal standing
The draft agreement will stress the importance of maintaining a single regulatory space on the island of Ireland. This will essentially mean a customs union and parts of the single market which affect free movement of goods, services and people applying to Northern Ireland to maintain an open border.
The deal covering Ireland, which will be contained in a protocol attached to the withdrawal agreement but with the same legal standing, will apply the customs union and any parts of the single market that are necessary to avoid border-related checks between Northern Ireland and the Republic of Ireland.
Separate provisions will be spelled out in the draft agreement to cover agriculture and food to ensure that the two sectors likely to be worst hit by Brexit on both sides of the Border are not affected with different rules and procedures being applied north and south.
EU law on animal health will also be applied in both jurisdictions under the default “backstop” option.
The language and scope of the text is said to be comprehensive and robust, covering the terms of the December agreement reached between the EU and UK and approved by the Government.
Minister for Foreign Affairs Simon Coveney said the Government's priority was to translate the December political agreement into "new draft legal text."
‘Strong support’
"We want to work with UK and defend island of Ireland interests," Mr Coveney said on Twitter, noting that the Irish side had received "strong support" from the EU's Brexit negotiator Michel Barnier.
Mr Barnier warned EU27 ministers on Tuesday that in the face of “plenty of differences” between the EU and UK, agreement on a Brexit transition remains far from “a sure thing”. Agreement on transition is key to opening phase two talks on the EU-UK future relationship.
He gave ministers in Brussels an update on the negotiations and set out the broad outlines of the EU’s draft withdrawal agreement, which the commission is due to publish on Tuesday and which will then be negotiated with the UK.
The draft agreement is likely to create tensions between the DUP and the Conservatives, which is in power with the support of the unionist party. It will not cover Mrs May's commitment to the DUP that there would be no new regulatory barriers between Northern Ireland and the United Kingdom.
