Northern Ireland could be given joint EU and UK status and a “buffer zone” on its border with the Republic, under new plans being drawn up by David Davis.

The scheme is understood to be under consideration as a potential way of breaking the deadlock over future customs arrangements ahead of a crunch summit of EU leaders on June 28-29.

But it was dismissed as “fantastical” by anti-Brexit campaigners, while Liberal Democrats described it as “like something out of Alice in Wonderland”.

Future customs arrangements are likely to be high on the agenda at a meeting of leaders of British industry with Theresa May and senior ministers to discuss the Government’s Brexit strategy at 10 Downing Street on Monday.

The Prime Minister has divided ministers into two working groups to try to find a means of fulfilling her twin pledges to take Britain out of the European customs union while keeping the Irish border open.

The two options currently on the table – a customs partnership backed by the PM which would see the UK collect tariffs on the behalf of the EU and a “maximum facilitation” scheme using technology to avoid border checks – have split Mrs May’s Brexit war cabinet down the middle.

David Davis
David Davis heads the working group revising the ‘Max Fac’ plan for the Irish border (Stefan Rousseau/PA)

And Brussels’ rejection of both schemes was underlined by chief Brexit negotiator Michel Barnier, who said neither was “operational or acceptable”.

In a film for Vice News, Mr Barnier said he had “no certainty” about the nature of Britain’s future relationship with the EU.

“I can see the difficulty and intensity of this debate,” he said. “We are waiting for the British to have clear positions and choices.”

And he told a private meeting of the European Parliament’s Brexit Steering Group: “They have two proposals which are being debated with British ministers. Neither of those proposals are operational or acceptable to us.”

Mr Davis’s alternative “Max Fac 2” solution would ditch  the technological solutions previously favoured by the Brexit Secretary as a way of recording movements across the border without the need for checkpoints.

These were dismissed as unworkable by EU officials and raised concerns from police about possible sectarian attacks on infrastructure like numberplate recognition cameras.

Instead, Mr Davis is now considering a new “double-hatted” solution based on the model in place in Liechtenstein, which would allow the province to operate both UK and EU regulations at the same time.

A 10-mile wide “special economic zone” would be created along the 310-mile border, within which local traders could operate under the Republic’s trade rules.

Countdown to Brexit – 300 days to go
(PA Graphics)

An unnamed Whitehall source told The Sun: “Max Fac 2 is tremendously complicated, but it’s at least something the Cabinet can unite around.”

The source acknowledged it would be a challenge to secure backing for the plan from the Democratic Unionist Party, which props up Mrs May’s Government at Westminster and has made clear that it does not want Northern Ireland treated differently from the rest of the UK.

Mr Davis’s Department for Exiting the EU did not deny that the proposal was under consideration.

A spokesman said only: “We have set out two viable future customs arrangements with the EU and work is ongoing to refine these.

“Both of these would deliver on our commitments to ensure UK-EU trade is as frictionless as possible, avoid a hard border between Northern Ireland and Ireland, preserve the integrity of the UK’s internal market and enable us to establish an independent international trade policy.”

Michel Barnier
Michel Barnier on a visit to Northern Ireland last month (PA)

A Downing Street spokesman said: “The Prime Minister has been absolutely clear that we cannot and will not accept a customs border down the Irish Sea, and that we will preserve the integrity of the UK’s common market.

“Work is ongoing on customs plans that will achieve this, as well as ensuring we can strike trade deals around the world, that trade remains as frictionless as possible, and that there is no hard border between Northern Ireland and Ireland.”

Sinn Fein accused Mr Davis of trying to “hide a hard border in a buffer zone”.

MEP Martina Anderson said: “Once again this shows the lack of knowledge of border areas and the concerns they face – David Davis obviously didn’t learn much on his flying visits.”

Labour MP Chris Leslie, a supporter of the Open Britain campaign against a hard Brexit, said: “If there was an award for coming up with unnecessarily complicated and convoluted solutions to self-inflicted problems, David Davis would win it every year.

“The solution to this dilemma is staring David Davis in the face: the UK as a whole must stay in the single market and the Customs Union.”

And Liberal Democrat Brexit spokesman Tom Brake said: “More and more by the day, Tory plans are sounding like something out of Alice in Wonderland.

“The public must be given the final say on the deal, with the opportunity to Exit from Brexit.”

Sammy Wilson
Sammy Wilson criticised the suggested plans (Liam McBurney/PA)

DUP MP Sammy Wilson said none of the mooted proposals had been discussed with his party. He described them as “at best contradictory”.

He said: “First of all, to suggest that Northern Ireland be tied to both EU and UK regulations, when one of the objectives of leaving the single market is to allow the UK to set its own regulations, raises the question which regulations apply to Northern Ireland if and when the UK and the EU regulations diverge?

“Secondly, who will make the judgement as to which regulations should apply? Will it be the EU or the UK Government? Will it be the UK courts or the European Court of Justice?

“The purpose of the border buffer zone appears to be even less clear. Whilst the idea seems to be that movement can take place within the buffer zone, what happens to trade from outside the buffer zone when it crosses into that zone? Do checks have to be carried out there?

“These convoluted arrangements only arise because of the Government’s failure to make it clear to the EU that regardless of Barnier and EU negotiators’ attempts to keep us in the customs union and the single market, we are leaving.

“The Government must make it clear that all of the borders which will exist as a result of us leaving, whether that is between Northern Ireland and the Irish Republic, the Irish Republic and Great Britain, or Great Britain and Europe all present the same problems.”

The Brexiteer MP added: “Instead of moving from one set of half-cooked ideas to the other it is now time for the Government to put down its foot and make it clear to EU negotiators that the Prime Minister stands by her commitment that no deal is better than a bad deal and if they want to avoid the consequences then they need to stop dismissing the perfectly feasible ideas that were put forward in August of last year.”