European Union (EU) and British negotiating teams have reached an agreement on their relationship after BRICEST in a "political declaration" that should be approved at Sunday's summit, European Council President Donald Tusk said.
Tusk said the European Commission had informed him of its agreement to the political declaration on future relations between Britain and the European Union.
"I have sent to the Commission a draft political declaration on the future relationship between the EU and Britain," he said. "The president of the commission, Jean-Claude Juncker, told me that he was approved at the negotiator level and at the political level initially."
He said EU leaders still had to approve the text, which would be attached to a draft agreement on Britain's exit clauses from the EU.
The text, which will be attached to the British withdrawal treaty from the European Union, "sets out the foundations of a promising, expanded, deep and flexible partnership" in the areas of trade, foreign policy, defense and security, according to the 26-page text.
The agreement also said that the transitional period after Britain's exit from the European Union on March 29, 2019 could be extended until the end of 2022.
This transitional period is supposed to allow preparation for the post-BRICEST era, especially the future economic and trade relationship between Britain and the 27 EU states.
However, UNHCR later announced that the Gibraltar and fishing issues should still be worked out under the BRICCAST agreement.
Immediately after the agreement was announced, the British government said that Prime Minister Teresa Mae would speak to the House of Commons today.
"The prime minister will address the House of Commons later in the day," said British Minister for Relations Affairs Andrea Ledesum.
The announcement of the agreement was a positive sign in the British capital markets, where sterling rose more than 1% against the dollar on Thursday.