11:25

Sylvie Goulard, a French liberal MEP, who closely follows Brexit, thought the prime minister struck a friendlier tone, compared to her party conference speech. The speech was “a PR communication for the rest of Europe”, the MEP, said, but the British prime minister’s threat to turn Britain into a low-tax island was unmistakable, she added.

“Blackmailing partners is never a good thing. Certain declarations have a certain tone, which is not nice,” she said, also referring to the chancellor Philip Hammond’s warning that the UK could become a low-tax haven for corporations.

The discussion on tax was “very worrying. As far as I know the UK is a member of the OECD and is committed in the G20 and OECD to tackle tax fraud, tax evasion and not to encourage tax avoidance. It would be very strange for the UK not to reflect its own commitments.”

She pointed out May’s speech also contained important omissions, with no direct reference to the €60bn (£51bn) Brexit bill being prepared by EU Brexit negotiator Michel Barnier. “This is her version of what a good deal would look like and there is still a lot of work to do.”

In her view, the speech clarified what kind of relationship the British government wanted with the EU, but left big questions open. On the single market, May’s desire for the “greatest possible access” was “not very clear”, while “grey areas” remained over what she wanted on the customs union and reciprocal rights for EU citizens.

This view was echoed by an EU source who said the speech brought clarity, by ruling out options, such as a Swiss model or Norway-style membership of the European Economic Area, while leaving many questions to be worked out. “It brings it into clearer focus and enables everyone to sit down and prepare for the negotiations with that tighter focus.”

One of the trickiest points for both sides will be agreeing a transition deal. EU negotiators have made clear that the UK cannot have a transition deal without accepting the writ of the European court of justice. “It is obviously going to very difficult. If it is the status quo or close to it, it is going to be very difficult for the UK to accept. If it is very different from the status quo, it may prejudge the outcome of the negotiations,” an outcome that would be unacceptable for the EU, the source said.