In effect - and if no other solution is found - this would keep Northern Ireland in a customs union.
The controversial plan, immediately condemned by UK Prime Minister Theresa May, was outlined on Wednesday by EU chief negotiator Michel Barnier who, at the same time, called on the UK to come up with alternatives.
Guy Verhofstadt, the European Parliament’s Brexit coordinator, said the assembly will “closely scrutinise” the draft proposals, which also cover citizens’ rights for the three million EU nationals in the UK and 1.4 million Britons in the EU.
Speaking on behalf of the Parliament’s Brexit steering group, the Belgian deputy added, “We welcome the overall approach taken by Michel Barnier.
“On the rights of EU citizens, the Parliament welcomes the inclusion of future partners in the draft treaty, as we have long pushed for. We will remain vigilant and review the Commission's proposals, whilst continuing to seek assurances from the UK government that the procedure to obtain the agreed status for EU citizens living in Britain after the transition will be cost free, simple and declaratory in nature.”
The MEP said, “Both the UK and the EU made commitments in December regarding the maintenance of the Good Friday agreement and the need to avoid any hardening of the Irish border.”
Verhofstadt insisted that Parliament's commitment to Ireland “remains steadfast.”
He added, “If we cannot find a negotiated settlement to avoid any hardening of the border, then it is important to have a backstop in place to maintain the free flow of goods and products on the island of Ireland, but all sides have been clear this is a fall-back option.
“A transition period will only be possible if we can agree a withdrawal treaty. Any transition agreement must respect the full acquis of the European Union; we cannot accept that, compared to goods and services, citizens are discriminated against and treated differently because of the transition. "
Roberto Gualtieri, the S&D group spokesperson on Brexit, said, “On Northern Ireland, both the UK and the EU have said throughout the process that they do not want to see any hardening of the border. This was the basis of the joint report signed in December and today’s proposals translate that commitment into a legally binding text, ensuring that the fallback position can be used if it is needed.
“It is clear that the other possibilities foreseen in the joint report should be explored in parallel to this. It is now up to the UK government to propose credible and viable alternative options: the ball is now in May’s court.”
Elsewhere, the Greens/EFA group said they welcomed the EU's protocol on Northern Ireland, which sets out a fallback position for what will happen if the UK and EU fail to reach an agreement that would be consistent with the Good Friday agreement.
Under the protocol, Northern Ireland would in effect remain in the customs union and would continue to operate within the single market for goods (but not services).
Greens/EFA group co-leader Philippe Lamberts said, "The EU has been crystal clear that the Good Friday agreement must be respected. We can never allow politics to take precedence over peace.”
“If Prime Minister May has an alternative up her sleeve, we look forward to hearing it. But given the continued lack of clarity surrounding the UK’s position, and the fact that senior members of Theresa May's cabinet still struggle to accept the seriousness of the Irish question, there is a clear need to set out protections,” added the Belgian deputy.
"Nothing in this agreement should come as a surprise. This is exactly what the UK signed up to back in December and they cannot now feign surprise at being asked to honour it."
A Parliament source said its assessment of the draft withdrawal treaty “will follow in due course.”
He said, “Additionally, a resolution defining Parliament's position on a possible framework for EU-UK future relations will be debated and put to vote in the March plenary session.”