Updated: 12.35
European Union leaders have agreed to move on to the second phase of Brexit talks.
In a tweet, European Council President Donald Tusk offered his 'congratulations' to British Prime Minister Theresa May.
EU leaders agree to move on to the second phase of #Brexit talks. Congratulations PM @theresa_may
— Donald Tusk (@eucopresident) December 15, 2017
European leaders say "sufficient progress" has been made on the initial divorce issues - the Irish border, Britain's exit bill and citizens' rights.
Negotiators can now begin discussing the terms of the transition period before Britain's EU exit takes full effect, before turning their attention to the future trading relationship.
The EU's position on the transition was confirmed on Friday - and Brussels' stance could provoke anger among UK Brexit supporters.
Under guidelines released by the European Council and agreed by leaders of the 27 remaining member states, the UK will remain under the jurisdiction of the European Court of Justice and be required to allow freedom of movement during this period, which is expected to last for two years.
Essentially, Britain will have to follow EU rules in their entirety.
The Taoiseach Leo Varadkar says he would like the UK to have 'as much access as possible' to European markets.
Speaking on his way into the second day of an EU summit on Friday, Mr Varadkar said he and Theresa May will speak again in the new year.
"It was quite brief, it was just an opportunity to compare notes again and really essentially what we agreed is that we would talk again in the new year - she's gone home, she's not here today - Britain not being in the euro and not being permitted to attend Article 50 discussions.
"We agreed that we'd speak in the new year - both about another attempt to get the Northern Ireland executive up and running, and secondly about the Phase II talks.
"And I expressed my wish that we should proceed as quickly to start talking about issues around trade in particular - and she agreed with that".
Leo Varadkar arrives for day two of the EU summit | Image: © European Union
British Prime Minister Theresa May was applauded by some other leaders following a dinner in Brussels on Thursday.
She told leaders: "I believe this is in the best interests of the UK and the European Union. A particular priority should be agreement on the implementation period so we can bring greater certainty to businesses in the UK and across the 27."
On the applause, Mr Varadkar said: "Theresa May gave a report just basically giving her outline as to where things stood - there wasn't a roundtable discussions because that's not permitted under Article 50.
"A few people offered some encouraging remarks - some good luck remarks, Merry Christmas-type remarks - and there was a light round of applause after that".
Speaking following a dinner meeting last night, the British Prime Minister Theresa May said the UK was aiming for a smooth and orderly withdrawal – and called for a swift transition period.
EU Commission President Jean-Claude Juncker says there is nothing unusual about the applause.
"She is our colleague," he said. "Britain is a member state and so we not only try to be; but we are polite and friendly people."
Mrs May insisted her government is on course to deliver Brexit" as she tried to shrug off a House of Commons defeat on key legislation.
She noted that her government had won 35 of 36 votes on the Brexit process within the House of Commons and insisted the EU Withdrawal Bill was “making good progress.”
“We're on course to deliver Brexit and we're on course to deliver on the vote of the British people," she said.
Second phase talks will begin next month and are expected to focus on the initial transition period ahead of the UK’s official withdrawal.
The EU has warned that talks on trade will not begin until the transition period is agreed.
Additional reporting: Jack Quann
