EU reveals no-deal plans

• UK unveils post-Brexit immigration curbs

• Businesses issue stark warning as talk of no deal grows

The European Union yesterday adopted backup plans to protect air transport and financial markets in the event Britain leaves without a Brexit deal in 100 days.

And the bloc promised that British citizens living in Europe would continue to enjoy residents' rights "provided that this approach is reciprocated by the UK".

EU officials insist the measures would not mean Britain can quit the union painlessly, but that it is important for "time-limited" measures to "mitigate" the harm.

"The best, if you talk in terms of the economy and avoiding disruptions, is to stay within the EU," European Commission vice-president Valdis Dombrovskis told reporters.

"Then, if the decision on Brexit is taken, of course, withdrawal or Brexit with a deal is better than withdrawal with no deal," the former Latvian prime minister said.

"In case of no deal scenario, doing some preparation to minimise damage is better than no preparation at all."

The European Commission said it was acting "to ensure that the necessary contingency measures can enter into application on 30 March 2019 in order to limit the most significant damage caused by a 'no-deal' scenario".

The package covers 14 areas where a "no-deal" Brexit "would create major disruption for citizens and businesses" including in financial services, air transport, customs and climate policy.

Brussels hopes it will not have to activate its plan if Prime Minister Theresa May persuades a sceptical British parliament to endorse a broad withdrawal deal she struck with European leaders last month.

Under the plan, the European Union will allow UK-based financial operators to continue to access European markets for 12 months under a "temporary and conditional equivalence" period to prevent disruption.

The announcement in Brussels came as  Britain yesterday published proposals for an EU immigration crackdown after Brexit as business groups warn the economy is not ready for Britain to crash out of the European Union without a divorce agreement in place.

Home Secretary Sajid Javid said visas would be introduced for EU nationals arriving after Britain leaves the bloc and the new system would be based on skills, not nationality, putting EU and non-EU citizens on the same footing.

Meanwhile, Britain's five leading business associations yesterday warned that companies have been "watching in horror as politicians have focused on factional disputes rather than practical steps that business needs to move forward".

The group, which included the Confederation of British Industry big business lobby and the Federation of Small Businesses, said: "The lack of progress in Westminster means the risk of a no-deal Brexit is rising".