Seamless trade arrangement with EU outlined in Britain's 1st major Brexit proposal

Davis said: "The approaches we are setting out today will benefit both the EU and UK and avoid a cliff-edge for businesses and individuals on both sides."

"The way we approach the movement of goods across our border will be a critical building block for our independent trade policy," he said. "An interim period would mean businesses only need to adjust once to the new regime and would allow for a smooth and orderly transition."

British chancellor of the exchequer, Philip Hammond said: "Our proposals are ambitious and set out arrangements that would allow British businesses to continue to trade with their European partners in the future, while expanding their markets beyond the EU."

"In the near term, they will reassure people and companies that, the day after we leave the EU, they will still be able to go about their business without disruption as we make a smooth transition to our bright future outside the EU and deliver a Brexit that works for Britain," he said.

The new document also tries to avoid any form of hard-border between Ireland and Northern Ireland and to establish an independent international trade policy.

The British international trade secretary Liam Fox said: "Leaving the Customs Union will allow us to operate a fully independent trade policy in Britain's national interest which will benefit UK businesses and consumers."

"We will seek a new customs arrangement that ensures that trade between the UK and the EU remains as frictionless as possible and allows us to forge new trade relationships with our partners in Europe and around the world," he added.

The European Commission, the EU's executive arms, said Tuesday that the paper release is a "positive step," but it would "carefully study" the text.

"'Frictionless trade' is not possible outside the single market and customs union," the European Commission warned.

Michel Barnier, the EU chief negotiator, also reiterated that talks on the future trade ties could not start until progress was made on other issues, including Britain's exit bill.