Latest: May declares she is 'well on road' to Brexit delivery

Her target was described as "realistic" but "dramatically difficult" to achieve by the president of the European Council, Donald Tusk.

Ms May was boosted by the terms of a statement agreed by the EU27 at the European Council summit in Brussels, which left the door open for "exploratory contacts" early in the New Year to allow Brussels to gain greater "clarity" on the UK's ambitions.

Speaking in her constituency, Ms May said that the move to the second phase of talks represented "an important step on the road to delivering the smooth and orderly Brexit that people voted for in June of last year".

She said Britain would be "beginning the talks about our future relationship straight away", adding: "There is still more to do but we are well on the road to delivering a Brexit that will make Britain strong, prosperous and secure."

With UK Cabinet ministers due to discuss their preferred "end state" relationship with Europe for the first time next Tuesday, the pressure is mounting on Ms May to deliver a detailed statement on her aims which the EU will regard as an adequate basis to enter swiftly into substantive talks.

Asked at a Brussels press conference whether Ms May's goal of concluding negotiations by March 2019 was achievable, Mr Tusk said: "It is still realistic and of course dramatically difficult. For sure, the second phase will be more demanding, more challenging than the first phase."

Mr Juncker said he was "convinced" a legally binding Withdrawal Agreement will be signed by October, to allow time for ratification by the European Parliament and MPs in Westminster.

The Commission will consult member-states on their priorities in a series of seminars early next year, he said, adding: "I think the real negotiations on the second phase will start in March next year. I cannot say when these negotiations will be concluded."

Mr Tusk's call for "unity" among the EU27 - whose trade interests in relation to the UK vary dramatically - was echoed by German chancellor Angela Merkel and French president Emmanuel Macron at a joint press conference.

Mrs Merkel said the upcoming talks would be "an even tougher piece of negotiation than we have had up to now".

But she added: "The good news is that all 27 member states so far... have stood together, and I am very optimistic that we will continue to go forward in quite the same spirit."

Mr Macron said: "We managed to keep the unity of the 27, the integrity of the single market, compliant with our rules. In the future we will do what it takes to do the same."

The momentous decision to declare that "sufficient progress" was achieved in the first phase of negotiations, which dealt with the divorce issues of citizens' rights, the Irish border and the UK's £39 billion exit bill, was made by the EU27 in the PM's absence in a meeting lasting less than half an hour at the European Council summit in Brussels.

Mrs May left the two-day summit early after winning applause from the other leaders as she assured them on Thursday evening of her determination to see Brexit through despite this week's defeat in the House of Commons.

She now faces the prospect of a second setback next week, with backbench Tories preparing to rebel again to prevent her enshrining the March 2019 Brexit date in law.

Update 12.36pm: British Prime Minister Theresa May has welcomed the European Council's agreement to give the green light for Brexit talks to move on to their second phase, dealing with the transition to a new relationship after the UK's withdrawal.

Thank you to Presidents @JunckerEU and @donaldtusk. Today is an important step on the road to delivering a smooth and orderly Brexit and forging our deep and special future partnership. https://t.co/PSaATiA17n

— Theresa May (@theresa_may) December 15, 2017

The EU position set out in the guidelines makes clear that any transition period agreed by Brussels "must be in the interest of the Union, clearly defined and precisely limited in time".

Under the proposals, the UK will be required to follow the EU rulebook in its entirety - including laws adopted during the transition period - while playing no part in the decision-making processes of the European institutions.

And the guidelines make clear that Britain will be expected to observe the single market's "four freedoms" of movement of goods, services, people and capital during the period, expected to begin on March 29 2019.

During the transition, the guidelines state, "all existing Union regulatory, budgetary, supervisory, judiciary and enforcement instruments and structures will ... apply, including the competence of the Court of Justice of the European Union.

"As the United Kingdom will continue to participate in the Customs Union and the Single Market (with all four freedoms) during the transition, it will have to continue to comply with EU trade policy, to apply EU customs tariff and collect EU customs duties, and to ensure all EU checks are being performed on the border vis-a-vis other third countries."

We will deliver on the will of the British people and get the best Brexit deal for our country - securing the greatest possible access to European markets, boosting free trade with countries across the world, and delivering control over our borders, laws and money. pic.twitter.com/Gzrpaf4sYz

— Theresa May (@theresa_may) December 15, 2017

The four-page guidelines pour cold water on Brexiteers' hopes of a swift movement to detailed negotiations on a free trade agreement with the EU.

They confirm that agreement on a future trade relationship can only be finalised once the UK has formally left the EU.

And they state that the EU is currently ready only to engage in "preliminary and preparatory discussions with the aim of identifying an overall understanding of the framework for the future relationship" after additional guidelines have been adopted at a future summit in March.

In a key passage hinting at the obstacles which lie ahead of a trade deal, the document notes that the UK has expressed its desire to leave the single market and customs union, and that the EU will therefore have to "calibrate" its approach on trade and economic co-operation to "ensure a balance of rights and obligations, preserve a level playing field, avoid upsetting existing relations with other third countries, and ... preserve the integrity and proper functioning of the Single Market".

The European Council confirmed its readiness to maintain co-operation with the post-Brexit UK in the fight against terrorism and international crime, as well as security, defence and foreign policy.

Earlier: European leaders have given the go-ahead for Brexit talks to move on to their second phase, dealing with the transition to a new relationship after the UK's withdrawal.

The momentous decision was announced by European Council president Donald Tusk after discussions lasting less than half an hour in Brussels.

British Prime Minister Theresa May was not present because she left the two-day summit early after assuring leaders of the remaining 27 EU nations yesterday evening of her determination to see Brexit through despite this week's defeat in the House of Commons.

EU leaders agree to move on to the second phase of #Brexit talks. Congratulations PM @theresa_may

— Charles Michel (@eucopresident) December 15, 2017

The EU27 agreed that last Friday's deal between Mrs May and European Commission President Jean-Claude Juncker amounted to "sufficient progress" to move negotiations on to their second phase.

That deal, covering the divorce issues of citizens' rights, the Irish border and the UK's £39 billion exit bill, will now be transformed into a legally binding form to be signed by October ahead of ratification by the European Parliament, Westminster and national assemblies around the EU.

Britain will remain under the jurisdiction of the European Court of Justice and be required to permit freedom of movement during a transition period expected to last two years after Brexit, under guidelines released by the European Council.

Meanwhile, negotiations can now start on the terms of a transition period, expected to last about two years after the official date of Brexit on March 29 2019.

But the long-awaited talks on a trade deal are expected to progress on a slower timetable, with the EU not expected to come up with its guidelines for the negotiations until March at the earliest.

EU leaders were putting pressure on Mrs May to spell out precisely what the UK wants on trade, with Maltese Prime Minister Joseph Muscat saying: "I think the first really big step is for the UK to say pretty clearly what it wants, in clear terms.

"I think that if this happens within the next few weeks, we can start in earnest and by March we will have a very clear European position."

Today's decision was considered little more than a formality after Mr Juncker and chief Brexit negotiator Michel Barnier said they believed "sufficient progress" had been made, and the European Parliament overwhelmingly endorsed that verdict in a vote on Wednesday.

Danish Prime Minister Lars Lokke Rasmussen welcomed the development, saying: "Now ready to move to phase two. Hope for close future relations with UK after Brexit."

European leaders are set to give their approval for Brexit talks to move on to their next phase, after receiving assurances from Theresa May that she will continue to drive the process forward despite defeat in the House of Commons.

But European Commission president Jean-Claude Juncker warned that the second phase, dealing with the transition to a post-Brexit relationship between the UK and EU, would be "considerably harder than the first - and the first was very hard".

Mrs May will not be present as the green light for transition talks is finally given at the European Council summit, having left Brussels early after telling fellow leaders over dinner on Thursday that she wanted to approach the remaining stages of EU withdrawal with ambition, creativity and perseverance.

Leaders of the remaining 27 member states applauded Mrs May's brief address, in what Mr Juncker described as a recognition of the "big effort" she has made to deliver a successful process.

Leaving the dinner after midnight, German Chancellor Angela Merkel said the British Prime Minister had made a good case for them to declare today that talks on the divorce issues of the Irish border, citizens' rights and the UK's £39 billion exit bill had made "sufficient progress" to move on to the second phase.

But she added: "There remains much work to do and time is pressing."

With Mr Juncker and chief negotiator Michel Barnier having already declared that last week's divorce deal amounted to "sufficient progress", and the European Parliament overwhelmingly backing this verdict on Wednesday, the decision on Brexit is little more than a formality expected to be approved in short order by the EU27.

But the moment will not be an unalloyed triumph for Mrs May, with no immediate move expected to trade talks on the kind of accelerated timetable Downing Street would prefer.

The text likely to be rubber-stamped promises only work towards a "framework" for a trade deal, with a wait until March before guidelines for the way ahead are produced.

And the document leaves no doubt that a formal free trade agreement cannot be signed until after the UK has left.

First priorities will be to translate last week's agreement into a legally-binding Withdrawal Agreement and to work out the terms for a transition period of around two years.

It was clear that the two sides remain far apart on the question of how much progress can be made on trade by the date of Brexit on March 29 2019, with UK officials continuing to talk about having an agreement ready to sign the day after departure, while Brussels expects much of the detailed work to be done during transition.

Mr Juncker said: "The process is that we have to formalise the Withdrawal Agreement.

"This will be put before the European Parliament and then we will start negotiations on future relations as soon as possible.

"It is a difficult process."

The Commission president said he was "sad" that the UK was leaving the EU, but asked whether he believed it possible they might change their minds and stay, he said: "That depends on the British Parliament and the British people.

"It is not up to us to decide what the British people want."

EU leaders said it was time for Britain to offer more clarity on the kind of trade deal it is seeking, with Maltese Prime Minister Joseph Muscat saying: "I think the first really big step is for the UK to say pretty clearly what it wants, in clear terms.

"I think that if this happens within the next few weeks, we can start in earnest and by March we will have a very clear European position."

Senior ministers are due to have their first discussion of the "end state" relationship with the EU in a Cabinet meeting next Tuesday which threatens to expose deep divisions between differing visions of the UK's future.

Meanwhile, Mrs May is facing a further challenge to her authority next week when British MPs vote on a Government amendment to enshrine the Brexit date of March 29 2019 in law.

Amid predictions of a second defeat, a senior British Government source denied that Mrs May was preparing to dump the provision.

The official also said that "no politician should face intimidation" after rebel ringleader Dominic Grieve reported receiving death threats amid calls from hardline Brexiteers for the deselection of the 11 Tories who joined Wednesday's successful revolt over the right for MPs to have a meaningful vote on the final Brexit deal.

Mr Juncker said Mrs May's message on Thursday was received in a "polite and friendly" fashion by fellow leaders, while Austrian Chancellor Christian Kern described her comments as "very constructive", adding: "Everybody appreciated her personal effort and engagement."

Asked whether EU leaders believed Mrs May remained in a strong enough position to deliver on Brexit, Mr Kern replied: "Absolutely."