"We are disappointed. We found Article 184 in the deal which threatens Spain’s ability to negotiate the future of Gibraltar with the UK. It is unacceptable," Sanchez told reporters.
Spanish authorities expect the document to be fixed by the time the leaders meet this weekend, the prime minister said, or else his nation will "exercise its veto right."
Gibraltar, located on the southern coast of Spain, has been a British Overseas Territory since 1713, when Spain ceded it to the United Kingdom under Utrecht Treaty. Spain has long laid claim to the territory, but the local residents rejected the idea of Spanish sovereignty in 1967 and joint UK-Spanish authority in 2002.
READ MORE: Spain Threatens to Thwart Theresa May's Brexit Plan Over Gibraltar Status
Following more than a year of tough talks on Brexit conditions, London and Brussels have finally produced a draft agreement on the conditions of the UK divorce from the bloc. The deal includes three protocols, concerning Gibraltar, Cyprus and the Irish border.
The protocol on Gibraltar created the basis for the administrative cooperation on a series of subjects – the rights of citizens, taxation, tobacco, environment, fisheries, police and customs cooperation. This protocol is part of a broader package of bilateral agreements between Spain and the United Kingdom on Gibraltar.
READ MORE: UK, EU Agree on British Military Bases in Cyprus, Gibraltar
EU leaders will meet in Brussels on Sunday for an extraordinary summit to discuss the UK’s provisional withdrawal agreement and a political declaration.