Theresa May called for an “implementation period” to be put in place while Brexit details are hammered out
The British Prime Minister has insisted her government will never accept any physical infrastructure on the Irish border.
Speaking in Florence, in what is regarded as potentially her most important speech since taking office, Theresa May set out her vision for a future partnership between the UK and the EU.
She called for a transition deal to be put in place while the details of Britain’s final exit from the bloc are hammered out.
She insisted this “implementation period” would be strictly time limited - adding that she expected it to last approximately two years from Britain's official exit in 2019.
In an attempt to break the deadlock on Britain's "divorce bill," Mrs May promised that the UK would "honour its commitments" to the EU Budget.
She did not mention a figure, but her commitment is a clear a hint that the Britain would be willing to pay up to €20bn into the EU's budget during this period.
Referencing Ireland, she said Britain had “recognised from the outset that there are unique issues to consider when it comes to Northern Ireland.”
“The UK government, the Irish government and the EU as a whole have been clear that through the process of our withdrawal, we will protect progress made in Northern Ireland over recent years - and the lives and livelihoods that depend on this progress,” she said.
“As part of this, we and the EU have committed to protecting the Belfast Agreement and the Common travel Area.
“Looking ahead, we have both stated explicitly that we will not accept any physical infrastructure at the border.
“We owe it to the people of Northern Ireland - and indeed to everyone on the island of Ireland - to see through those commitments.
She acknowledged that "for many this is an exciting time full of progress" while "for others it is a worrying one" adding that she felt "optimistic" about the outcome.
In a direct appeal to European leaders she called for a new “ambitious economic partnership” between the UK and the EU.
She warned that any partnership should not be modeled on existing trade deals - such as that recently agreed with Canada - and rejected the option of Britain remaining within the European Economic Area.
She insisted neither option would be good for the economies of the UK or the EU.
Mrs May also told the audience that she would ensure EU citizens in the UK would have their rights enshrined in the final Brexit treaty - with British courts directly bound by the agreement.
In a concession, she added that European Court of Justice case law could be taken into account in these cases, in order to assuage concerns that the UK Parliament might seek to dilute citizens’ rights in future.
In a direct message to Europeans living in the EU, said: "We want you to stay, we value you and we thank you for your contribution to our national life.
"It has been - and remains - one of my first goals in this negotiation to ensure that you can carry on living your lives as before," she said.
Mrs May proposed a "bold new strategic agreement" on security co-operation with the EU - adding that what she would is offering would be “unprecedented in its depth.”
She said Britain was “unconditionally committed to maintaining Europe’s security.”
"Our commitment to the defence and indeed the advance of our shared values is undimmed,” she said.
“Our determination to defend the stability, security and prosperity of our European neighbours and friends remains steadfast."
The tone of the speech was conciliatory, with Mrs May telling other EU countries that Britain wanted to be their "strongest friend and partner" while continuing to work together on crucial security issues such as trafficking and terrorism.
"I believe we share a profound sense of responsibility to make this change work smoothly and sensibly, not just for people today but for the next generation who will inherit the world we leave them,” she said.
"The eyes of the world are on us but if we can be imaginative and creative about the way we establish this new relationship ... I believe we can be optimistic about the future we can build for the United Kingdom and for the European Union."
Mrs May said that while Britain "has never totally felt at home being in the European Union," it would remain "a proud member of the family of European nations."
She said: "The British people have decided to leave the EU and to be a global trading nation, able to chart our own way in the world.
"I look ahead with optimism, believing that if we use this moment to change not just our relationship with Europe but also the way we do things at home - this will be a defining moment in the history of our nation."