Gordon Brown is planning to pick a fight with President Sarkozy of France at this week’s European summit as he tries to move the agenda on from demands for a referendum on the EU treaty.

The Prime Minister sent a letter yesterday to fellow leaders calling for the EU to promote free trade and openness, a direct challenge to Mr Sarkozy’s attempt at the June summit to move to a more protectionist Europe. Mr Brown hopes that the letter will become a main talking point at the meeting in Lisbon tomorrow, when the leaders switch their attention from the treaty to the EU’s response to globalisation.

It was released after Prime Minister’s Questions, at which David Cam-eron again mocked Mr Brown’s refusal to hold a referendum on the proposed treaty. “Why don’t you admit the reason you will not have a referendum is that you are scared of losing it?” the Tory leader demanded. “If you break your promise on this, no one will trust you on anything else.”

Mr Brown responded that the amending treaty did not represent fundamental change and that the national interest had been protected in negotiations. Agreement on the new treaty could be reached as soon as this evening when the 27 leaders sit down for a working dinner after a two-hour session on the document to replace the failed EU constitution.

Last night there were still several stumbling blocks to rapid agreement because six countries had outstanding problems, but none was thought to be insurmountable. The treaty will usher in a new EU foreign minister and full time president of the European Council, as well as scrapping the national veto over 50 policy areas and giving legal force to the Charter of Fundamental Rights.

Mr Brown’s letter, formally sent to the Portuguese Prime Minister, who is hosting the summit, but copied to all countries, calls for a competitive and dynamic single market for the EU. It added that the EU should, “promote free trade and openness, with the EU leading by example in breaking down barriers to create a free and fair multilateral trading system”.

It will be seen as a riposte to an eleventh-hour move by Mr Sarkozy in June to downgrade the role of competition in a section of the treaty that dealt with the fundamental objectives of the EU. The constitution proposed that the EU should have “an internal market where competition is free and undistorted”. The phrase was to be included in the new treaty to make free competition one of the objectives of the EU, upgrading its status from the Treaty of Rome, where it featured as a sub-clause.

When the first draft was printed, however, France successfully struck out the phrase “where competition is free and undistorted” because Mr Sarkozy wanted the treaty to strengthen protection for French businesses from cheap foreign competition. Mr Brown’s letter will be seen as trying to steer EU policy back to free market competition and there were signs yesterday that the French would argue against him tomorrow, creating a fresh row about the role of the EU.

French diplomatic sources confirmed that France was expecting a row with Mr Brown and did not rule out a direct response from Mr Sarkozy. “Gordon Brown’s attitude to globalisation has been part of our preparations for this summit,” an aide said. The Prime Minister’s spokesman denied that he was trying to provoke a row with Mr Sarkozy. He said: “The Prime Minister has a great deal of respect for Nicolas Sarkozy and will continue to work closely with him.”

However, Neil O’Brien, the director of the Eurosceptic Open Europe think-tank, said: “Downing Street may well be trying to cook up a fake row about somthing else like globalisation to distract from the enormous transfer of powers Gordon Brown is about to sign up to.”

José Manuel Barroso, President of the European Commission, pleaded with EU leaders yesterday not to rock the boat over the new treaty so that they could put four years of wrangling behind them. “We need the reform treaty to give Europe strong institutions that give Europe the capacity to act in the 21st century. We need to put this institutional debate behind us.”

He appealed in particular to the Italians, whose demand for more MEPs has emerged as the main possible snag to agreement on the treaty this week. “I really do not think a country like Italy, which has always been in the forefront of integration and where the European Union was founded [with the Treaty of Rome in 1957], would block the treaty,” Mr Barroso said.

The Poles are holding out for a stronger voting mechanism for medium-sized countries to block EU measures; they also want their own advocate-general, a senior post at the European Court of Justice; the Bulgarians want recognition that they can write “euro” in their Cyrillic script; the Austrians want a cap on German students who are flooding into their universities; the Czechs want greater powers to reject European Commission proposals; and Britain’s only outstanding issue is for a change in the wording on the role of national parliaments, which at the moment are told by the treaty that they “shall” work for the benefit of the EU, a phrase seen as placing Westminister under the direction of Brussels.

Mark Francois, the Shadow Minister for Europe, said: “On the eve of the Lisbon summit, Gordon Brown is clearly trying to divert attention away from his manifesto promise of a referendum and the fact that his much-vaunted red lines are collapsing under detailed scrutiny.”

The road ahead

18-19 October, 2007, Lisbon The informal European Council at which leaders are expected to agree the text of the reform treaty. Loose ends could be tied up after the council and should not prevent the text being agreed in outline

13-14 December 2008, Brussels The EU reform treaty will be signed by Gordon Brown and other heads of government. All states will be required to ratify the treaty by the end of next year

February 2008 The process of ratification begins in the House of Commons. William Hague admitted this week that without the Liberal Democrats it is unlikely that the Conservatives could force a defeat in the Commons

March 2008 The ratification process moves to the House of Lords, where the Conservatives have a far better chance of springing a surprise victory

June 2008 The legislation could receive Royal Assent

December 2008 All 27 EU members are expected to have completed ratification.

January 1, 2009 The EU reform treaty is expected to come into force

June 11, 2009 Elections to the European Parliament. The composition of the Parliament is supposed to be settled by the treaty

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