* May signs formal Brexit divorce papers
* Two years of talks loom; exit planned in 2019
* United Kingdom's future unclear, banks eye exiting London
(Adds May signing letter, quotes, call with Merkel)
By Guy Faulconbridge and Elizabeth Piper
LONDON, March 28 Prime Minister Theresa May will
file formal Brexit divorce papers on Wednesday, pitching the
United Kingdom into the unknown and triggering years of
uncertain negotiations that will test the endurance of the
Nine months after Britons voted to leave, May will notify EU
Council President Donald Tusk in a letter that the UK really is
quitting the bloc it joined in 1973.
The prime minister, an initial opponent of Brexit who won
the top job in the political turmoil that followed the
referendum vote, will then have two years to settle the terms of
the divorce before it comes into effect in late March 2019.
"Now that the decision has been made to leave the EU, it is
time to come together," May will tell lawmakers, according to
comments supplied by her office.
"When I sit around the negotiating table in the months
ahead, I will represent every person in the whole United Kingdom
– young and old, rich and poor, city, town, country and all the
villages and hamlets in between," May will say.
On the eve of Brexit, May, 60, has one of the toughest jobs
of any recent British prime minister: holding Britain together
in the face of renewed Scottish independence demands, while
conducting arduous talks with 27 other EU states on finance,
trade, security and a host of other complex issues.
The outcome of the negotiations will shape the future of
Britain's $2.6 trillion economy, the world's fifth biggest, and
determine whether London can keep its place as one of the top
two global financial centres.
For the EU, already reeling from successive crises over debt
and refugees, the loss of Britain is the biggest blow yet to 60
years of efforts to forge European unity in the wake of two
devastating world wars.
Its leaders say they do not want to punish Britain. But with
nationalist, anti-EU parties on the rise across the bloc, they
cannot afford to give London generous terms that might encourage
other member states to follow its example and break away.
May's notice of the UK's intention to leave the bloc under
Article 50 of the EU's Lisbon Treaty is due to be hand-delivered
to Tusk in Brussels by Tim Barrow, Britain's permanent
representative to the EU.
May, who on Tuesday signed the Brexit letter and spoke to
German Chancellor Angela Merkel about the future talks, will
update the British parliament on Wednesday while Tusk is due to
give a briefing to reporters.
EU officials expect May's notice of intention to leave the
bloc under Article 50 of the EU's Lisbon Treaty to be
hand-delivered by British diplomats on Wednesday, when May will
The Brexit letter will seek to set a positive tone for the
talks and recap 12 key points which May set out as her goals in
a speech on Jan. 17.
Within 48 hours of reading the letter, Tusk will send the 27
other states draft negotiating guidelines. He will outline his
views in Malta, where from Wednesday he will be attending a
congress of centre-right leaders. Ambassadors of the 27 will
then meet in Brussels to discuss Tusk's draft.
The course of the Brexit talks is uncertain.
May has promised to seek the greatest possible access to
European markets but said Britain will aim to establish its own
free trade deals with countries beyond Europe, and impose limits
on immigration from the continent.
She has acknowledged that those measures would require
withdrawing from the EU 'single market' of 500 million people,
founded on the principles of free movement of goods, services,
capital and people.
Her priorities also include leaving the jurisdiction of the
European Court of Justice and securing "frictionless" trade with
the bloc while ending full membership of the customs union that
sets external tariffs for goods imported into the bloc.
She wants to negotiate Britain's divorce and the future
trading relationship with the EU within the two-year period,
though EU officials say that will be hard.
"It was you, the British, who decided to leave, not us who
wanted you to go," said one senior EU diplomat. "The trading
relationship is going to be the most difficult bit to solve - I
don't see how that will be done in that time frame."
A huge number of questions remain, including whether
exporters will keep tariff-free access to the single market and
whether British-based banks will still be able to serve
continental clients, not to mention immigration and the future
rights of EU citizens in the UK and Britons living in Europe.
Global banks such as Goldman Sachs are considering
moving staff out of Britain due to Brexit, and some major
companies and banks could use the Article 50 trigger date to
update investors on their plans.
At home, May's United Kingdom - a nuclear power with a
permanent seat on the United Nations Security Council - is
divided and faces strains that could lead to its break-up.
The results of the Brexit referendum called the country's
future into question because England and Wales voted to leave
the EU but Scotland and Northern Ireland voted to stay.
Scottish nationalists have demanded an independence
referendum that May has refused, saying the time is not right.
In Northern Ireland, rival parties have been unable to end a
major political crisis for over two months and Sinn Fein
nationalists are demanding a vote on leaving the UK and uniting
with the Republic of Ireland.
"May's job is just so difficult - keeping the UK together
while Brexiting - that I am not sure anyone would want it," said
a senior non-EU diplomat who spoke on condition of anonymity.
"After Brexit, the future of almost everything is completely
unclear and that is extremely worrying for the UK, the EU and
the West as a whole."
(Writing by Guy Faulconbridge; Editing by Mark Trevelyan and