Britain is ready to remain in the customs Union because of Ireland

Minister Leo Varadkar right meets with British Prime Minister Theresa May left on the sidelines of an EU and Western Balkan heads of state summit at the National Palace of Culture in Sofia Bulgaria Thursday

Reacting to The Times report, the Sinn Féin Vice President Michelle O'Neill argued that the quotes attributed to Mrs May "are an admission that the threshold to hold such a vote has now been met".

May is under pressure at home and in Brussels to move forward with talks on Britain's divorce from the European Union, but is struggling to unite her cabinet of ministers around a single customs proposal to bring to the negotiating table. A pro-European Cabinet source said that Mr Johnson and Mr Gove were "outgunned" during the meeting and reluctantly accepted the plans.

The EU also will not accept May's request that the backstop is time-limited, meaning Britain could be in EU institutions for decades, a Brussels source tells Business Insider.

"In these negotiations while the Irish government seem to be playing a hard ball way".

The plans have raised the prospect of border checks with EU-member Ireland, which many fear could upset the fragile peace in the region. "I don't see much downside risk for the pound though because it is still a very undervalued currency", said Peter Kinsella, currency strategist at Commerzbank.

"We can not be confident on the politics of the situation, on how it plays out".

According to one Conservative MP: "She got him on facts". With May at the head of a minority government, she is prone to a commons defeat if the DUP do not support her position or if a relatively small number of her own party's MPs rebel.

Theresa May proposed on Thursday a "backstop" solution for a post-Brexit-customs regime regulating UK-EU trade.

The UK will draw up a new plan to avoid a hard border in Ireland after Brexit, Prime Minister Theresa May confirmed, amid growing speculation she could be forced to delay delivery of her pledge to leave the EU customs union.

May said three of her objectives - to forge an independent trade policy; a frictionless trade with the European Union and avoid disruption between Ireland and Northern Ireland - were not easy to achieve but maintained that only her government will fulfil the expectations of the pro-leave voters of the 2016 referendum.

European Union leaders are due to meet on 29 June, after which it is hoped in London that Brussels will start drafting a political declaration on a future trade deal. It would keep the United Kingdom in the EU's customs arrangement until such a time as another solution was found. Leo Varadkar said he would not disclose exactly what Ms May had offered, but made it clear that the plan from the British was insufficient.

But EU negotiator Michel Barnier said on Monday that no significant progress had been made in the Brexit talks since March and warned London that time was running out to seal a deal by October to prevent Britain crashing out of the bloc.

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