UK's post-Brexit plan 'will not work', EU says

"Everybody shared the view that while there are positive elements in the Chequers proposal, the suggested framework for economic cooperation will not work, not least because it risks undermining the single market," Tusk said in Austria.

"The moment of truth for Brexit negotiations will be the October European Council. In October we expect maximum progress and results in the Brexit talks," he continued, adding that EU leaders will decide then whether to call for a summit in mid-November to seal the deal.

Tusk added that the EU cannot compromise on its four freedoms or the integrity of its single market.

"This is why we remain sceptical and critical when it comes to this part the Chequers plan," he said.

Under the plan, May proposed a free trade area for goods, without adhering to the obligations of the EU's single market, such as free movement and contributions to the EU budget.

May, whose minority government is backed by a small unionist party in Northern Ireland, argued to fellow leaders during a dinner on Wednesday evening that the so-called backstop solution would effectively divide Northern Ireland from the rest of the mainland UK.

May in her 10-minute speech outlined how she sees the Brexit negotiations, that have been progressing at a snail pace over the last month, and argued for the EU to show more flexibility on the solution on avoiding a hard border on the island of Ireland.

But EU leaders told the British prime minister she needs to give guarantees on the Irish border before she can secure a divorce deal to avoid crashing out of the EU next March, when the UK is scheduled to leave.

The backstop solution, already agreed in principle by the UK and the EU last December, would keep Northern Ireland under the bloc's economic oversight until and unless the two sides agree to a trade deal to keep the UK-EU border open.

"We have very clear principles regarding the integrity of the single market and regarding precisely the Irish border," French president Emmanuel Macron told reporters at the summit. He also said explicitly that the Chequers plan is "not acceptable".

May later said she would put forward her own proposal on how to avoid a hard Irish border soon, but did not give any detail on what that would include.

Tusk also talked of the "full unity" among EU leaders.

But Hungary's Viktor Orban broke that unity somewhat, saying on Thursday that his country is one of those which does not wish to "punish" the UK. "Fair Brexit and a good cooperation between Britain and the EU are needed in the future," he said.

Hungary and, previously, Poland have voiced concerns about pushing the UK too hard, fearing it could end in a no-deal scenario. The two countries are themselves under the leadership of eurosceptic governments that have also challenged the EU over the rule of law.

Diplomats say that while for countries such as France and Germany it is important to make the point with regards to Brexit that a country is better in the EU than out, the governments of Poland and Hungary are less keen to make Brexit seem like a dead end.