The European Commission has recommended to the European Council that "sufficient progress" has been made in the first phase of Brexit negotiations with the UK.

During a press conference in Brussels early on Friday morning, British Prime Minister Theresa May said there would be no hard border with Northern Ireland and confirmed the Good Friday Agreement would be maintained.

May also confirmed EU citizens living in the UK would be able to "go on living their lives as they have done before".

The Commission's assessment is based on a joint report agreed by the negotiators of the Commission and the UK government.

This means the Commission is satisfied there has been sufficient progress on the three priority areas of negotiations – citizens' rights, the Northern Irish border and the financial settlement, or so-called divorce bill.

First breakthrough

A statement released by the European Commission states the rights of EU citizens living in the UK and UK citizens in the EU27 will "remain the same after the United Kingdom has left the EU".

"As regards the financial settlement, the United Kingdom has agreed that commitments taken by the EU28 will be honoured by the EU28, including the United Kingdom," the statement reads.

President of the European Commission, Jean-Claude Juncker, said they had now "made a first breakthrough".

"I am satisfied with the fair deal we have reached with the United Kingdom," Juncker said in a statement.

"If the 27 member states agree with our assessment, the European Commission and our chief negotiator Michel Barnier stand ready to begin work on the second phase of the negotiations immediately.

"I will continue to keep the European Parliament very closely involved throughout the process, as the European Parliament will have to ratify the final Withdrawal Agreement."

The European Council will decide on December 15 if sufficient progress has been made to allow negotiations to proceed to their second phase.

Challenges ahead

President of the European Council, Donald Tusk, has laid out his proposals in the draft guidelines, which he has now sent to the leaders of the Council.

He proposed the UK respect the whole of EU law, budgetary commitments, judicial oversight and all the related obligations during the two-year transition period when they will remain part of the single market and customs union.

"Clearly, within the transition period following the UK's withdrawal, EU decision-making will continue among the 27 member states, without the UK," he wrote in a statement.

He also called for "more clarity" on how the UK sees future relations after it has left the EU.

Tusk said the most difficult challenge was still ahead.

"We all know breaking up is hard," he said. "But breaking up and building a new relation is much harder.

"Since the Brexit referendum, a year and a half has passed. So much time has been devoted to the easier part of the task.

"And now, to negotiate a transition arrangement and the framework for our future relationship, we have de facto less than a year."

First chapter

The European Union's chief Brexit negotiator Michel Barnier said that, if the European Council decides progress is sufficient, "we will then have completed the first chapter of these extraordinary negotiations".

Referring to the financial settlement, Barnier said both parties agreed on a methodology that rests on three principles.

He confirmed no member state would pay more or receive less because of Brexit and said the UK would honour all commitments entered into during its membership.

They have also agreed on a list of components on the financial settlement and on the conditions of the UK's participation of the MFF 2014-20 and arrangement concerning the EIB, ECB and the EDF.

"Even if figures are bandied about, some of them realistic, I am not going to mention any figures myself," he said. "We will have to firm up the situation."

He also highlighted citizens' rights would be guaranteed – for UK citizens living in Europe and European citizens living in the UK.

"All citizens that arrived before Brexit can reside, work and study as today," he said.

Irish Taoiseach Leo Varadkar said at a news conference broadcast by the BBC that the deal has "set out what we set out to achieve".

"It is the end of the beginning," he said. "We don't want to see Northern Ireland drift apart from Great Britain."