Theresa May has confirmed she wants the UK be given a two-year transition period after it leaves EU.
Under her plan, EU citizens would keep their right to move freely to the UK during that time but they would have to register their presence.
″We are very clear the transitional period will be time limited and we will leave by March 2019,” she said.
“During the implementation period access to one another’s markets should continue on current terms.”
In a high profile speech in Florence on Friday afternoon, May said after the transition period the UK would leave the single market and asked Brussels to agree to a new “creative” and “ambitious” bespoke trade deal.
May confirmed the UK is prepared to pay a substantial amount of money to the EU - the so called Brexit bill.
“The UK will honor commitments we have made during the period of our membership,” she said.
She moved to reassure EU citizens living in Britain by writing any guarantee of their rights post-Brexit into UK law.
May said British courts would “take into account” European Court of Justice (ECJ) judgements when dealing with disputes over EU nationals living in the UK.
She told EU citizens living in Britain: “We want you to stay, we value you, and we value your contribution to our national life. I’m clear the guarantee I’m giving on your rights is real.”
The prime minister also said the UK wanted to sign a new “unprecedented” security treaty with the EU to ensure cooperation after Brexit.
“The UK is unconditionally committed to maintaining European security,” she said.
Brexit talks between Brexit secretary David Davis and the EU’s Michel Barnier have stalled amid concerns of a lack of progress on issues including the financial settlement and citizens’ rights.
Speaking in front of a slogan that read “shared history, shared challenges, shared future”, May said a good Brexit deal was vital for the EU as well as for the UK.
“As we meet here today, in this city of creativity and rebirth, let us open our minds to the possible to a new era of cooperation and partnership between UK and EU and to a stronger, fairer, more prosperous future for us all,” she said.
“For that is the prize if we get this negotiation right. A sovereign UK and a confident EU. Both free to chart their own course. A new alliance that can stand strongly together in the world. That is the goal, towards which we must work.”
May’s speech was an attempt unclog the talks as well as paper over cracks within her cabinet ahead of the Tory conference in Manchester next month.
The speech came after a week of speculation that Boris Johnson could quit as foreign secretary in protest at her approach to Brexit.
The foreign secretary has used a 4,000 word article in The Daily Telegraph to pressure the prime minister into sticking to a so-called hard Brexit.
However after a marathon two-and-half hour session of the Cabinet on Thursday, Johnson and Chancellor Philip Hammond – who have been at loggerheads all summer over Brexit – left No.10 together in an apparent show of unity.