EU's new treaty to reignite tensions

The treaty attempts to set out details of the Brexit withdrawal deal that May and European Commission chief Jean-Claude Juncker sealed in principle after marathon talks in December.

EU Brexit negotiator Michel Barnier, who will unveil the draft in Brussels, on Tuesday insisted it contained "no surprises" -- but the part about Ireland has already caused problems.

British Foreign Secretary Boris Johnson caused a stir with a leaked letter that cast doubt on avoiding a hard border between EU-member Ireland and British-ruled Northern Ireland after the divorce.

Speaking to Sky News, Johnson said the row was is "being used quite a lot politically to try to keep the UK in the customs union, effectively in the single market, so we can't leave the EU."

Irish 'backstop'

Barnier confirmed the draft would include a controversial "backstop" which says that if no better solution is found, Northern Ireland would remain in "full alignment" with the EU's single market and customs union in order to uphold a 1998 peace agreement.

Ireland's RTE broadcaster said the text would refer to a "single regulatory space" on the island of Ireland.

But London opposes the idea and is angry about reports the treaty will omit a key clause from the December agreement saying any deal must not draw an effective border across the Irish Sea between Northern Ireland and the rest of Britain.

The Irish issue is politically explosive in Britain, with May's fragile Conservative government propped up by pro-British MPs in Northern Ireland. May also has to keep key eurosceptics in her cabinet like Johnson onside.

A further point of disagreement is likely to be the extent to which the EU says the withdrawal agreement must be governed by the bloc's top court, the European Court of Justice, which is another red line for London.

On the transition phase -- a period in which Britain will follow EU law without any say in policymaking, in return for access to the single market -- Barnier on Tuesday said it would rule out an "open-ended" phase.

Instead the EU will insist on a "short" transition ending on December 31, 2020.

London and Brussels are also expected to disagree on whether EU expats moving to Britain during the transition should get the same rights as those who came before, and on whether London gets a say in new EU laws.

The draft will finally set out details of the December pact covering the £35-£39 billion (40-45 billion euros, $47-52 billion) financial settlement Britain will pay as it leaves the EU.

'Critical week'

The draft will be adopted by EU commissioners on Wednesday before going to the remaining 27 EU states and then to Britain.

The clock is ticking for both sides to finalise the withdrawal agreement and then ratify it before March 29, 2019, the date Britain leaves.

The EU and Britain are separately negotiating a framework for future relations.

May will give a keynote speech on Friday finally setting out her vision for those post-Brexit ties, while the EU will set out its own red lines at a summit in March.

Pressure on May mounted this week when opposition Labour leader Jeremy Corbyn announced a policy shift in favour of staying in a customs union with the EU.

Barnier said Tuesday he agreed with EU President Donald Tusk's view that so far, most of London's demands for trade after Brexit are "pure illusion".

Tusk meets May in London on Thursday as part of what he has called a "critical week" for Brexit talks.