Brexit: Badenoch says the UK can diverge from EU rules

Business Secretary Kemi Badenoch has said the UK will retain the ability to diverge from EU rules.

It comes after a report that the government will voluntarily limit divergence as part of a deal aimed at restoring devolution in NI.

Such a move would help minimise post-Brexit trade barriers between NI and the rest of the UK.

Speaking in the House of Commons, Ms Badenoch did not deny that such a policy was being considered.

Northern Ireland has remained inside inside the EU's single market for goods while the rest of the UK has left.

That means there is free-flowing trade between Northern Ireland and the Republic of Ireland.

However, new checks and controls are required on some goods coming from Great Britain - what is known as the Irish Sea border.

At the point Great Britain left the single market it had the same rules as the EU but over time divergence is likely to occur as the two sides update their rules.

Growing divergence could potentially increase the level of controls on goods coming from Great Britain to Northern Ireland and require businesses to make changes to their processes.

The Daily Telegraph has reported that the UK government is offering to introduce a new requirement that all new laws are "screened" to ensure they will not create extra trade barriers.

The newspaper said it would mean all legislation would have to accompanied by a ministerial statement confirming it did not have a "significant adverse impact" on internal UK trade.

The offer could form part of a package aimed at getting the DUP to end its boycott of devolved government over the impact of the sea border.

In the Commons, the former Northern Ireland secretary Theresa Villiers asked Ms Badenoch if she was "in a position to deny a report in the Telegraph today that the government has pledged to introduce a requirement that all future regulatory law change will be screened to ensure that they don't create extra trade barriers in the Irish Sea?"

Ms Badenoch said she could not comment on the NI political process as she was not involved in it.

She added: "What I will say is that we retain the ability to diverge, that is clear, and I do agree with her that if we are really to seize the benefits of Brexit we need to find that comparative advantage in our regulations with the EU, otherwise there would be no point."