As widely reported in the press, the European Commission has announced that, in its view, "sufficient progress" has now been made to allow Brexit talks to advance to the next stage (including discussion of the UK's future relationship with the EU).
It is undoubtedly good news that "sufficient progress" appears to have been made – if it hadn't, the time left for discussions on the remaining matters which need to be agreed (particularly the pressing issue of transitional arrangements) would have been extremely tight. It is also good news that agreement in principle seems to have been reached on citizens' rights and money – which were highly sensitive issues for both sides and could easily have derailed the talks.
It may be possible for business to draw some comfort from the "backstop" position on Northern Ireland – which appears to be that, unless the UK can reach agreement with the EU on other ways to avoid a "hard border" between Northern Ireland and the Republic of Ireland, it will continue to align itself with "those rules of the internal market and the Customs Union which, now or in future, support North-South cooperation, the all-island economy and the protection of the Good Friday (Belfast) Agreement."
But the final decision on whether "sufficient progress" has been achieved will be made by the European Council at its summit meeting on 15 December 2017 – and until that has happened, celebrations may be premature. Assuming that the Council gives the go-ahead for talks to move onto other issues (including the shape of the UK's future relationship with the EU), there are a number of other reasons why any champagne should probably be kept on ice for the time being:
In conclusion, whilst today's announcements are encouraging, a great deal remains to be agreed in "Phase 2" of the Brexit talks. As a result, our view remains that businesses should continue to hope for the best, whilst planning for the worst.