TAOISEACH Leo Varadkar has said there is "no demand" from the Irish government that any part of the UK should stay in the EU customs union or single market after Brexit.
He said the "only way" to avoid a hard border would be by Northern Ireland "continuing to apply the rules of the single market and the customs union".
But Mr Varadkar said this did not necessarily mean the UK or Northern Ireland remaining members of either area, suggesting that a "bespoke" arrangement may be reached.
The taioseach was speaking yesterday at the British-Irish Council summit in Jersey, where he was asked about a leaked EU paper which suggested Northern Ireland would need to have single market and customs union rules to avoid a hard border.
Mr Varadkar added: "There is no demand from the Irish Government that any part of the United Kingdom should remain in the customs union or the single market.
"The United Kingdom would be welcome to if it wishes to, but it's not our demand that the United Kingdom should do so.
"What we want, though, is the language that we've all agreed to to be turned into reality. We've agreed that there will be no hard border in Ireland, that there will be no physical infrastructure and that there will be no return to the borders of the past.
"We believe that can be best achieved by continuing to apply the same sort of rules and regulations. If we do that we can avoid those things we wish to avoid."
Northern Ireland secretary James Brokenshire stressed that British prime minister Theresa May had made clear that the UK will be leaving both the EU single market and customs union.
He added: "We are very clear on the need to be pragmatic and open to these practical solutions that recognise the unique circumstances."
SDLP leader Colum Eastwood said the internal European negotiation paper effectively mapped out the need for special EU status for Northern Ireland after Brexit.
"This is a welcome and timely clarification that the trading relationship across the island of Ireland must remain unchanged in order to avoid any hardening of the border in Ireland," he said.
Sinn Féin TD David Cullinane said the British government should ensure the north remains in the "single market, the customs union and EU legal framework".
He urged the Irish government to "exercise their veto on progressing the talks to include trade, if the British government refuses to do this".
However, DUP Lagan Valley MP Jeffrey Donaldson said: "The last thing we need for Northern Ireland is a border in the Irish Sea, a customs border separating us from our biggest market. That's just not feasible."
Alliance MLA Stephen Farry said EU and UK single markets are "not mutually exclusive", while UUP MEP Jim Nicholson criticised the European Commission for appearing to focus on the UK's so-called 'divorce bill' upon leaving the EU.
