EU's draft new deal envisages close ties with Brexit Britain

By Gabriela Baczynska

BRUSSELS (Reuters) - The European Union's new deal with Brexit Britain envisages a tight trade and security relationship, according to a draft seen by Reuters on Friday, despite London saying it is seeking looser ties.

Britain left the EU in January and is in negotiations with the bloc over a new partnership to take effect after a status-quo transition period runs its course at the end of the year.

The draft, prepared by the bloc's executive Commission before a second round of talks next week, includes a reference to so-called "level playing field" provisions to ensure fair competition by keeping rules aligned, which London rejects.

"The Parties recognise that the establishment of conditions that ensure a level playing field between the Parties is necessary for trade and investment," the 441-page draft read.

On fisheries, another contentious point between the estranged allies, it envisages reciprocal access to waters. Negotiations would be held each year by Dec. 10 on fishing opportunities for the following year.

In case of trade disruptions, the bloc would be allowed to impose protective measures as soon as 15 days after notifying Britain, it also read.

The draft comes with an accompanying 17 pages of a proposed new partnership on "foreign policy, security and defence", which recognizes, however, that "the United Kingdom has expressed clearly that it does not wish to engage" in such negotiations.

While the EU is pushing to keep Britain in close touch from 2021, Prime Minister Boris Johnson has said he is prepared to default to World Trade Organization rules, which include tariffs and quotas, if London and the bloc are unable to seal a deal.

Johnson also demands that Britain leave the jurisdiction of the EU's top court. The EU draft envisages an arbitration panel to resolve disputes with Britain, but says the panel must be bound by rulings on EU law by the European Court of Justice.

Britain has said it would present its own draft of the future deal before the second round, which is due to start on March 18. Face-to-face talks have now been canceled because of the coronavirus epidemic.

"We are looking at how the discussions can take place using an alternative forum such as video conferencing," a spokesman for Johnson said on Friday.

(Additional reporting by Eliabeth Piper, Writing by Gabriela Baczynska; Editing by Catherine Evans, Chizu Nomiyama and Peter Graff)