UK's May offers trade bill compromise but rebels vow to fight on

LONDON (Reuters) - Britain’s government cannot accept a plan put forward by pro-European Union rebels in parliament that could see Britain stay in the bloc’s customs union, junior trade minister George Hollingbery told parliament on Tuesday.

FILE PHOTO: Britain's Prime Minister, Theresa May speaks at the Farnborough Airshow, in Farnborough, Britain July 16, 2018. Matt Cardy/Pool via REUTERS

Despite facing a possible defeat in parliament, the government refused to accept an amendment which would require ministers to try to negotiate a customs union arrangement with the EU if, by Jan. 21, 2019, it had failed to agree a deal with the bloc that offered frictionless free trade for goods.

“It is the policy of the government that we should not remain part of a customs union - that is why we cannot accept the amendment today. Clearly we would not be able to implement any independent free-trade deals,” Hollingbery said during a debate on post-Brexit trade laws.

The government offered to try to reach a compromise when the bill is debated in the upper chamber of parliament. The rebels rejected that and urged the government to instead accept their amendment and then discuss a compromise in the upper chamber.

The last-minute attempt at a concession underlines the difficulty Prime Minister Theresa May faces in passing legislation on one of the most divisive and important decisions in modern British history with only a minority government and a party at war with itself.

The creation of a backstop option that could keep Britain inside the customs union would enrage the pro-Brexit wing of May’s party, some of whom are already keen to oust her because they feel her exit plan keeps Britain too close to the EU.

The issue will come to a head in a vote due after 1700 GMT.

A defeat would plunge May’s leadership and the future of Brexit itself into doubt, and could trigger resignations from her government or even a move to topple her premiership.

Reporting by Elizabeth Piper and William James; Editing by Stephen Addison

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