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UPDATE 3-Ireland sees "a way to go" before agreement on border in Brexit talks

talks@

* Ireland needs details on border deal before Dec meeting

* Says UK needs to avoid 'regulatory divergence' on island

* Paper confronts London with "logic of Brexit" - diplomat (Adds Irish PM quotes, EU/Irish diplomat)

DUBLIN/BRUSSELS, Nov 10 (Reuters) - Ireland's foreign minister warned on Friday there was still "a way to go" in Brexit talks on the Irish border and welcomed an EU paper suggesting Britain needs to avoid "regulatory divergence" with the bloc if it wants to maintain a soft border.

The future EU/UK land border between Ireland and Northern Ireland is one of three issues -- along with the exit bill and safeguarding expatriate rights -- that Brussels wants broadly solved before it decides in December whether to give the green light to move on to talks on future trade relations.

"I think that there is a way to go between the two negotiating teams to be able to provide credible answers and sufficient progress in the context of the Irish border before we can move on to Phase Two," Coveney told Irish state broadcaster RTE.

"While we welcome the language we get from the British government in the context of north-south challenges... there has always been a skepticism on how we are going to get there in the context of the British approach to Brexit as a whole."

The Irish government has called on Britain to do more than simply promise a "hard" border will not return between it and Northern Ireland, which until a 1998 peace deal was separated by military checkpoints because of 30 years of sectarian violence in the British province.

The best way to achieve this is by maintaining the same regulations on both sides of the border, Irish Prime Minister Leo Varadkar said on Friday, adding that this did not amount to a demand that any part of the UK remain in the EU customs union.

That point was underlined in a working paper circulated to governments by the EU's Brexit task force this week, a copy of which was seen by Reuters. It said it was essential the UK committed to ensuring no regulatory divergence emerges from the customs union if it wants to prevent a hard border.

While Britain restated its commitment on Friday to avoid erecting any physical infrastructure on the border, it also plans to quit the customs union and does not want to be bound by EU rules and regulations once it leaves.

Brexit minister David Davis said a deal on the border was only possible in the context of talks on future trade and that "cannot amount to creating a new border inside the UK," a nod to the Northern Ireland unionists backing his government firmly opposed to the province staying in the customs union.

LOGIC OF BREXIT

Coveney said the working paper showed that the other 26 EU countries remained "absolutely in sync" with Ireland on the issue and EU diplomats said there had been no shift in position.

While some analysts saw it pushing for Northern Ireland to effectively remain in the customs union and single market in order to ensure regulations remained the same on both sides of the border, it can equally be read as suggesting the whole United Kingdom must not let its rules diverge far from the EU.

"This is simply confronting the British with the logic of Brexit and the avoidance of a hard border," one senior EU diplomat said.

Either London ensures no regulatory divergence between north and south but allows divergence between Great Britain and Northern Ireland that would create an effective customs border in the Irish Sea, he added.

Or, to avoid a new internal UK border as Davis said, the UK as a whole must continue to follow EU market rules and standards closely something that EU Brexit negotiator Michel Barnier called for on Thursday.

"They need to clarify this to have sufficient progress," one Irish official said.

Asked whether Ireland might veto a move onto trade talks, Coveney said he did not think it was helpful "at this stage" to talk about individual countries blocking things. (Additional reporting by Padraic Halpin in Dublin and Alastair Macdonald in Brussels; Editing by Emelia Sithole-Matarise)