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Newsdeck: May Gives Tories Free Vote on Key Amendment: Brexit Update

Theresa May’s Brexit deal was thrown out again by Parliament, and politicians are now poised to force the government to take a no-deal exit off the table. As May’s control over Brexit slips, the focus is now on the amendments lawmakers will propose to try to force the next steps.

Key Developments:

Parliament votes on no-deal Brexit from 7 p.m., starting with amendments May said to give Conservatives free vote on the so-called Malthouse amendment -- it’s a plan B alternative that the EU has already rejected May takes Prime Minister’s Questions in Parliament at 12 p.m., Chancellor of the Exchequer Hammond to deliver Spring Statement at about 12:30 p.m. Pound rises as traders predict Parliament will vote against no-deal and for extension

How Long an Extension? (11:50 a.m.)

At a meeting in Brussels this morning, EU government envoys discussed possible extension scenarios, a person familiar with the matter said. There was no conclusion --- it’s a political decision that will be taken by the leaders, and the length will depend on the reasons the U.K. cites for wanting a delay, the official said. Those could range from needing time to ratify the Withdrawal Agreement or prepare for no-deal, or elections or a second referendum. Ambassadors were briefed that no further negotiations with the U.K. are under consideration at the moment.

May Said to Agree to Free Vote on Malthouse (11:15 a.m.)

Having said last night that there would be a free vote on whether to seek a no-deal Brexit, May found herself in fresh trouble this morning as her government considered how to direct Conservatives to vote on amendments to the motion. After some reports that Tories would be told to vote against the so-called Malthouse B amendment (see 10:40 a.m.) -- which proposes what its supporters see as a managed no-deal departure -- an official said this too would be a free vote. That comes after pro-Brexit ministers including Transport Secretary Chris Grayling and Defence Secretary Gavin Williamson were said to have urged May not to whip Tories against the amendment. Even if MPs do back it, the EU has already repeatedly rejected it, including on Tuesday. There’s also no word yet on whipping arrangements for other amendments, including the one which seeks to get a firmer commitment to ruling out no-deal.

Barnier: No-Deal Risk ‘Never Higher’ (10:55 a.m.)

More from the EU’s chief negotiator, who spoke at the European Parliament in Strasbourg this morning (see 10:15 a.m.) “We are at a critical point,” Barnier said. “The risk of a no-deal has never been higher -- that is the risk even by accident of the U.K. exiting from the EU in a disorderly fashion. I urge you not to underestimate that risk or its consequences.”

Brexiteers Warn May on Whipping (10:40 a.m.)

Pro-Brexit Cabinet ministers including Transport Secretary Chris Grayling and Defence Secretary Gavin Williamson urged May not to whip against the Malthouse amendment (see 8:50 a.m.) for fear of splitting the Conservative Party, according to two people familiar with discussions in this morning’s Cabinet meeting. Williamson was first to speak on the issue at Cabinet, according to one of the people. He told May it would be “daft” to whip against Malthouse as it would have “severe consequences” for the Conservative party and for morale among Tory MPs. “It’s going to cause us a lot of problems.” He also called for an extension to Article 50. The Malthouse amendment calls for the government to negotiate an extension of Britain’s EU membership until May 22, and then a standstill period until the end of 2021 to negotiate a free-trade deal -- in exchange for payments to the EU. But the bloc has repeatedly ruled it out.

Barnier: Brexit-Deal Talks ‘Done and Dusted’ (10:15 a.m.)

Speaking in the European Parliament in Strasbourg, the EU’s chief negotiator Michel Barnier said the bloc can’t grant a request to delay Brexit until it knows what the U.K. wants it for. Negotiations on the divorce deal are “done and dusted,” he said, adding that last night’s vote in the House of Commons “prolongs and makes worse” the uncertainty. “This treaty which we negotiated with the government of Theresa May for a year and a half is and will remain the only available treaty.” Speaking after Barnier, Guy Verhofstadt, the European Parliament’s Brexit spokesman, called on the U.K. to make its mind up on Brexit and said he would oppose any request for delay that didn’t have a clear purpose.

Uncertainty Is ‘Devastating’ U.K.’s Economic Ties (9:50 a.m.)

Brexit-related uncertainty is “devastating” the U.K.’s economic relations with European partners and many buyers of British goods are actively looking for alternative sources of supply, according to a leading German business lobby. German companies currently won’t sign sign long-term delivery contracts with British partners and are stocking up on goods wherever possible, Holger Bingmann, president of Germany’s BGA association of exporters and wholesalers, told Bloomberg. Read more: Brexit Uncertainty ‘Devastating’ U.K.’s Economic Relations

Sterling Rallies Ahead of Vote (9:30 a.m.)

The pound strengthened the most among the Group-of-10 currencies before Wednesday’s vote in Parliament, when analysts expect lawmakers to reject leaving the European Union without a deal. The pound extended this year’s gains versus the dollar to more than 3 percent, the best performance among G-10 currencies.

Conservatives Jostle Over Amendments (8:50 a.m.)

MPs are laying down amendments ahead of tonight’s vote, including one backed by Brexiteers including Steve Baker as well as more moderate Tories. It calls for the government to negotiate an extension of Britain’s EU membership until May 22, and then a standstill period until the end of 2021 to negotiate a free-trade deal -- in exchange for payments to the EU budget. “We think this is a way through,” Baker said on BBC Radio 4. “We are in the business of finding a way to unite all wings of the party and the DUP.” The problem is that the EU has repeatedly said a transition or standstill period is not on offer without a full withdrawal agreement. That means, according to Conservative MP Nick Boles, that many Tories won’t back it. “It’s basically a no-deal exit,” he told the same program. “It’s important to stick to things that can be delivered, that are on offer, and not to try to come up with new schemes -- however attractive sounding -- that simply won’t fly.” DM

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