British Prime Minister Theresa May has ruled out membership of the EU single market when Britain leaves the European Union.
Photo: AFP
In a long-awaited speech, she said staying in would mean accepting the EU's rules without having a say in making them, and therefore "not leaving the EU at all".
However, the prime minister promised to push for the "freest possible trade" with European countries and to sign new deals with others around the world.
Mrs May's speech came after months of criticism that she was not being sufficiently transparent about the process.
She used it to announce her priorities for Brexit negotiations, including maintaining the common travel area between the UK and Irish Republic and "control" of migration between the UK and the EU.
She said a phased approach would avoid a cliff-edge for business.
Mrs May said Parliament would vote on the final deal agreed between the UK and the EU.
She planned to launch the two-year exit negotiation process by the end of March.
The British pound surged 2.8 percent on the back of Mrs May's speech - its biggest daily gain since at least 1998.
Britain to stay a 'good friend' to Europe
Mrs May said there would not be a "blow-by-blow" account of negotiations, set to begin after Article 50 of the Lisbon Treaty is invoked.
It was not her intention to "undermine" the EU or the single market, but she warned against a "punitive" reaction to Brexit, as it would bring "calamitous self-harm for the countries of Europe and it would not be the act of a friend".
"Britain wants to remain a good friend and neighbour to Europe," she said.
She added: "I am equally clear that no deal for Britain is better than a bad deal for Britain."
UK voters opted for Brexit in last June's referendum by 51.9 percent to 48.1 percent. England - with the exception of London - and Wales voted strongly to leave the EU. Scotland and Northern Ireland voted to remain.
People voting for Brexit had done so "with their eyes open", the prime minister said, and the country was "coming together" after the referendum.
"Now we need to put an end to the division and the language associated with it - Leaver and Remainer and all the accompanying insults - and unite to make a success of Brexit and build a truly global Britain."
Labour warned of "enormous dangers" in the prime minister's plans.
Labour leader Jeremy Corbyn urged the prime minister to "be clearer" about her long-term objectives, arguing that she she wanted to "have her cake and eat it" over the single market.
He added: "I think we have to have a deal that ensures we have access to the market - we have British jobs dependent on that market - that's what we'll be pushing for."
UK parliament vote on Brexit deal will be binding
The vote in parliament over Britain's final Brexit deal would be binding, a spokeswoman for Mrs May said.
However, she stressed the country would withdraw from the EU regardless of the outcome.
The vote would happen at the end of a negotiating period with the EU.
Asked whether a "No" vote would mean Britain would then rely upon World Trade Organisation terms, she said, "Either way, we will very clearly be leaving the EU".
The head of the Confederation of British Industry, Carolyn Fairbairn, said she welcomed the clarity on Brexit, but warned it was a "major step" to leave the EU's single market.
"It is very important now that we go into these negotiations aiming for an all encompassing free trade arrangement and do whatever can be done to head off the risk of falling back into WTO regulations," she said.
A French diplomatic source said exiting the single market would strip British financial firms of their "EU passport".
- BBC / Reuters