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It is now “unlikely” that Britain and the EU will agree a Brexit trade deal, Brussels’ chief negotiator has said.
Michel Barnier said he was “disappointed, concerned and surprised” after another week of negotiations ended without progress.
UK chief negotiator David Frost insisted a deal was “still possible” but conceded: “It will not be easy to achieve.”
The two sides remain far apart on whether the UK and EU should follow the same rules on state aid, and on agreeing a deal on how European boats get access to British fishing waters.
That was despite the UK this week tabling a draft legal text for a deal to “consolidate both sides’ positions on goods and services,” a senior British negotiating official said.
“We have been saying it’s time to move to text-based discussions, the negotiation is ripe for doing that,” they said.
“We’ll have to see what the EU makes of that in the next couple of weeks because we believe it’s a useful basis to move things forward,” they added.
A failure to strike a deal by the end of the year would mean the UK and EU effectively default to trading on World Trade Organisation (WTO) rules, with potentially huge economic disruption.
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At a press conference in Brussels at the end of talks, Barnier said: “Too often this week it felt as if we were going backwards rather than forwards.
“At this stage, an agreement between the UK and the European Union looks unlikely. I simply don’t understand why we are wasting valuable time.”
Frost said: “We have just concluded the seventh round of negotiations with the EU. As I said last week, agreement is still possible, and it is still our goal, but it is clear that it will not be easy to achieve.
“Substantive work continues to be necessary across a range of different areas of potential UK-EU future cooperation if we are to deliver it.
“We have had useful discussions this week but there has been little progress.
“The EU is still insisting not only that we must accept continuity with EU state aid and fisheries policy, but also that this must be agreed before any further substantive work can be done in any other area of the negotiation, including on legal texts. This makes it unnecessarily difficult to make progress.”
Barnier, however, insisted that EU demands for a so-called “level playing field” of common rules and standards on areas like state aid were “non-negotiable”.
“The need for a level playing field is not going to go away, even if the UK continues to exist on a low-quality agreement on goods and services only,” he said.
He added that “it is a non-negotiable pre-condition to grant access to our market of 450m citizens”.
Barnier said: “We are asking for nothing more, but nothing less, than what prime minister Boris Johnson committed to in our joint political declaration last October together with the 27 EU leaders.”
The EU’s negotiator also said the two sides had made “no progress whatsoever” on fisheries, with the UK demanding more control over British waters than Brussels is willing to accept.
Barnier stressed that any trade deal must include common rules and warned that the UK would have to make similar concessions in agreements with other countries, like the United States.
He said: “We hear the British government’s concern about maintaining its sovereignty and its regulatory autonomy and we respect that, clearly. But no international agreement was ever reached without the parties agreeing to common rules – no international agreement.
“And I can predict, with absolute certainty, this will also be the case of trade agreements between the UK and other partners in the future such as the United States, Japan and Australia.
“Apart from the question of a level playing field there are still many other areas where progress is needed and for example, obviously fisheries where we have made no progress whatsoever on the issues that matter.”
But Frost said the EU needed to accept the “reality” of what the UK is seeking.
“We have been clear from the outset about the principles underlying the UK approach,” he said.
“We are seeking a relationship which ensures we regain sovereign control of our own laws, borders, and waters, and centred upon a trading relationship based on an FTA [free trade agreement] like those the EU has concluded with a range of other international partners, together with practical arrangements for cooperation in areas such as aviation, scientific programmes, and law enforcement.
“When the EU accepts this reality in all areas of the negotiation, it will be much easier to make progress.”
The two sides will remain in “close contact” before another formal negotiating round in London in the week beginning September 7, Frost said.
Barnier once again insisted “the clock is ticking”, with October seen as a deadline for negotiations if any deal is going to be agreed and ratified by the end of the transition period on December 31.
The UK senior negotiating official refused to be drawn on whether talks could drag into October or beyond.
“We will have to see what can be done in September,” they said.
“This is very doable in September if we work hard and don’t put unnecessary obstacles in our way.”