{UAH} U.K. Wants Another Brexit Extension, EU Wants Assurances

European Union leaders are preparing to grant British Prime Minister Theresa May more time, at a summit Wednesday, to win backing in Parliament for an agreement to leave the bloc.

Mrs. May has asked for a second delay in Brexit until June 30. Were the EU not to grant an extension, the U.K. could leave the bloc without a deal as soon as Friday, raising the prospect of significant economic damage for Britain and some EU economies. The U.K. was originally scheduled to leave on March 29.

Mrs. May, whose Brexit deal has been rejected three times by British lawmakers, canceled a regular cabinet meeting Tuesday to meet with German Chancellor Angela Merkel in Berlin and French President Emmanuel Macron in Paris.

Mrs. May briefed the leaders on her talks with the main opposition Labour Party, to which Mrs. May turned last week after failing to win backing from her deal from a group of hard-line lawmakers in her own Conservative Party.

"The leaders agreed on the importance of ensuring Britain's orderly withdrawal from the European Union," Mrs. May's office said in a statement after her meeting in Berlin.

Mrs. May's deal is aimed at smoothing Britain's exit from the bloc. It contains a legally binding withdrawal agreement on divorce issues, such as the financial settlement the U.K. will make to the EU and a transition period in which economic relations will stay as they are until at least the end of 2020. It also contains a political declaration outlining future ties, which isn't legally binding.

While appearing ready to grant an extension, EU leaders haven't settled for how long. European Council President Donald Tusk said Tuesday evening in a letter to other leaders that he believes an extension of at least a year remains a good option.

Based on recent experience "as well as the deep divisions within the House of Commons," he said, there is "little reason to believe that the ratification process can be completed by the end of the June." Agreeing to a longer extension would avoid constant deadlines and crises over Brexit.

Any deal, Mr. Tusk said, would come with strings attached to avoid the U.K. blocking key EU initiatives while waiting to leave and to make clear that the current withdrawal agreement isn't open for renegotiation. Under his proposal, if the U.K. and the EU completed the ratification of the Brexit deal early, the U.K. could leave before the deadline.

The European Council president acknowledged the argument that a shorter extension would keep pressure on the British to reach a decision. "As you know, with Brexit there are no easy solutions. Both aforementioned options have their advantages and disadvantages," he said.

The EU's chief negotiator Michel Barnier said the European side was focused on ensuring Britain leaves the bloc in an orderly fashion.

"We are attempting to give the U.K. this last opportunity, if you like, to achieve an orderly withdrawal," he said, following a meeting of European ministers on Brexit in Luxembourg. "Saying that more time might be needed or less time, depending on the type of pressure you are trying to exert, well, that's what this is all about."

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Talks between Mrs. May's Conservative Party and the U.K.'s main opposition Labour Party on finding a way to approve a Brexit deal continued Tuesday. Mrs. May's office said afterward the talks had been "productive and wide-ranging" and the two sides said they would meet again on Thursday after the Brussels summit.

The talks appear hard going, however, with Labour reporting no progress on its two main proposals: that the U.K. should remain in the EU's customs union after Brexit—a step that would limit the U.K.'s abilities to enter into its own trade deals—and that another referendum be held to confirm public support for any deal.

Labour also wants a guarantee that any changes to which it agrees to secure the deal won't be overturned by a future Conservative prime minister. Mrs. May has said she would step down after her deal is passed.

European diplomats stressed after Tuesday's meeting that they expected no crisis this week.

Asked if he expected the U.K. to leave Friday without a deal, Luxembourg Foreign Minister Jean Asselborn said "certainly not."

EU leaders are eager to avoid taking any blame if Britain is seen to crash out of the bloc. Discussions focus on what conditions to attach to an extension.

Mr. Barnier said the EU would want to see a road map of next steps from the British side. He said a plan setting out that the U.K. wants to be part of the EU's customs union would be an example of an acceptable road map.

French European Affairs Minister Amélie de Montchalin said an extension raises questions about what issues the U.K. would want a role in deciding in the coming period. Under EU law, the U.K. would maintain all its rights and obligations as long as it is a member of the bloc.

However, British diplomats have taken a back seat in some important European debates since the 2016 Brexit referendum on the basis that they didn't want to intervene in discussions affecting the bloc's future.

The U.K. has acted to ensure it can comply with one expected EU requirement: that if it is still in the bloc, it will hold elections for the European Parliament on May 23. Mrs. May has made clear that she strongly wants to avoid holding the elections and they won't go ahead in Britain if the U.K. has left by then.

Write to Laurence Norman at laurence.norman@wsj.com and Stephen Fidler at stephen.fidler@wsj.com

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