Ministers could face a legal challenge from a pro-EU think tank that argues Brexit does not mean the UK must quit the European Economic Area (EEA).

The EEA extends the tariff-free trade of the single market to non-EU countries.

In a statement, British Influence says: “Remaining in the EEA is fully compatible with the Brexit referendum ‘red lines’ of ending budget contributions to the EU, repatriating legal sovereignty and, to a significant extent, free movement of people. Clarity could both speed-up Brexit and deliver a ‘smart’, win-win Brexit.”

Lawyers for the think tank have written to David Davis MP, requesting his department “to clarify its position on the UK membership of the EEA after Brexit” ahead of a possible judicial review of the UK government’s stated position that “As the UK is party to the EEA Agreement only in its capacity as an EU Member State, once we leave the European Union we will automatically cease to be a member of the EEA.”

The think tank argues that the UK has a “golden opportunity” to negotiate its position if the leaving the EEA is not an automatic consequence of Brexit.

The statement adds: “There is no legal consensus over whether the UK is a contracting party to the EEA only as a member of the EU, and there are strong reasons to suggest membership of the EEA will continue after we leave the EU until such time as we formally trigger our withdrawal from the EEA agreement by invoking Article 127 of the agreement.”

British Influence director Peter Wilding, who coined the term “Brexit”, said: “This is the solution to Brexit. We believe the government has not understood the value of remaining in the EEA after Brexit, nor has it understood how we leave the EEA, or that we do not need to leave the EEA in order to respect the red lines the June 23rd referendum established.

“This is not about stopping, thwarting or delaying Brexit, but getting a smarter Brexit that delivers for the UK and doesn’t destabilise the continent of Europe. Membership of the EEA after Brexit should be a key objective of the UK government, and not simply surrendered for a mess of pottage.”