Theresa May concluded her speech with a clarion call to the UK to capitalise on the opportunities thrown up by Brexit:

Tough talk now - Theresa May gives what can only be interpreted as an ultimatum to other EU leaders. 

While the UK wants to be a friend to the EU, if the EU takes a punitive approach to the talks, this would be an "act of calamitous self-harm" and would not be the act of the friend.

For a variety of political and economic reasons, she believes that a "bad deal would be worse than no deal" and the UK could easily get by with the latter.

The UK is drawing strength from the fact that people have come together since the Brexit vote, whichever way they voted. 

Theresa May talks about the importance of "discipline" within negotiations, saying a "stray word" or running commentary could be highly damaging.

Her job, she says sternly, is to get the best deal for Britain and "not to fill column inches" - that suggests that this will be Mrs May's last substantial word on her negotiating strategy for while. 

The last important element in the jigsaw is now being addressed - will the UK seek some transitional arrangement after two years if no deal is reached?

Mrs May says that she wants to secure the outline of a trade agreement within the time allocated for the Brexit separation process.

But she acknowledges that there are concerns among business and she wants to avoid a "cliff-edge" situation where rules change overnight.

She is not seeking an "unlimited" transitional period, which would see the UK bound by EU rules - describing this as a form of "political purgatory".

But she says there could be individual interim arrangements to minimise disruption to certain sectors of the economy.

So we now have clarity on the single market - and the UK's future out of it.

The Prime Minister moves on to another vital component of a future Brexit settlement - the customs union.

She says the UK wants to be able to negotiate trade deals with countries around the world, but she also desires cross-border trade with the European Union to be as free and "frictionless" as possible. 

Are these incompatible objectives? The PM says not. 

The UK does not want be bound by a common commercial policy or common external tariff - key facets of the existing customs union - but will look to strike its own bespoke customs agreement with the EU.

She says she is "open-minded" about how this will be done and she has no pre-conceived position - adding "it is the ends rather the means" that matter.

Theresa May says she wants a "bold and ambitious" trade arrangement with the EU but insists this cannot mean continued membership of the single market.

This would involve the UK accepting continued jurisdiction of the European Court of Justice - which would effectively "mean not leaving the EU at all".

This would be unacceptable and she says:

She raises the possibility that the UK might make an "appropriate contribution" to retain access to the single market - an idea backed by some ministers.

But she says the days of the UK "paying vast sums of money to the EU every day" will soon be over. 

The pound continues to climb, now at $1.2247, up 1.7% for the session.

Image source, Reuters

Theresa May is expanding on her 12 priorities for the negotiations, which she says are underpinned by four over-aching principles.

Moving on to immigration, she says the UK has always been an open and tolerant country which will continue to welcome the "brightest and the best".

But she says that when levels of migration get too high, support for open borders "falters" and says that the public were telling politicians that this had happened before and during the referendum.

The British people are demanding controls on the numbers of EU citizens coming to the country and she will deliver on that.

She goes on to to say that she wants to guarantee the right of EU citizens in the UK at an early stage if there is a reciprocal deal for UK citizens in Europe - some EU nations accept this will others don't, she announces. 

House of Commons
Parliament

SNP economy spokesman Stewart Hosie says Scotland's trade with the EU has grown by 20% and "today's hard Tory Brexit puts that at risk".

He also suggests that some Leave voters wanted to remain in the single market.

Philip Hammond insists that the government aims to "engage constructively with the real world".

Theresa May says the negotiations with EU partners will be tough but there will have to be "give and take" and compromises will have to be agreed.

Scotland, Wales and Northern Ireland must be involved in the process and the planning for leaving - no decisions currently taken by the devolved administrations will be removed.

Turning to Northern Ireland, she talks about the political crisis and hopes that it can be resolved. She also says she values the common travel area between the UK and the Republic of Ireland, which predates EU membership, and which she says must be recognised in the final deal. 

The pound has nudged higher since the Prime Minister started speaking. It's now at $1.222 up 1.4% for the session.

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Labour's Barry Gardiner says a speech is not enough and he expects the government to bring a white paper to the Commons for scrutiny.

The opposition reserves the right to try to amend it, he says, while not standing in the way of Brexit. 

The UK prime minister says that European laws and directives - the so-callec acquis - will be adopted into British law as part of the Brexit process.

And she confirms that the UK Parliament will have a vote on the final Brexit settlement when it is agreed. 

Mrs May is talking about the UK's relationship with the EU after Brexit, saying EU nationals will continue to be "welcome" to come to the UK and hopes that this will be reciprocated. 

But she dismisses suggestions that the UK could retain an associate or partial membership of the EU, insisting it "cannot be half in and half out".

What she wants is a "new, constructive partnership" based on shared interests - with the UK restoring its sovereignty and self-determination. 

House of Commons
Parliament

As Theresa May begins her much-anticipated Brexit speech, Tory MP William Wragg calls on the chancellor to confirm that the UK will leave the single market, "no ifs, no buts".

Philip Hammond tells him that "we cannot be members of the single market because of the political lines around the four key freedoms that the other leaders have set" - one of which is the freedom of movement of people.

Mr Hammond adds that the government aims for a free trade deal with the EU.