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Britain and the EU have both set out tough objectives for the crucial next phase of the Brexit negotiations.
Boris Johnson and EU chief negotiator Michel Barnier both want the same thing – a comprehensive free trade deal with agreements in other areas like security once the current standstill transition period finishes at the end of December.
But they were both uncompromising in key speeches on Monday setting out their opening positions.
All the same, any successful negotiation requires concessions, usually from both sides.
HuffPost UK has had a look at both the British and Brussels negotiating objectives set out on Monday.
So as we enter a year of high stakes talks, what are the key flashpoints that could scupper any deal?
The ‘level playing field’
This is where the two sides are furthest apart. The EU’s draft negotiating mandate calls for “robust commitments ensuring a level playing field for open and fair competition”.
Essentially this means the UK agreeing to uphold Brussels standards on state aid, competition, employment social issues, the environment, climate change and tax.
Barnier insists this is “inextricably linked” to the EU granting the UK the Canada-style deal demanded by Johnson, and points out that a level playing field was agreed in the political declaration that accompanied the withdrawal agreement that ensured an orderly Brexit last week by triggering the transition period.
But the prime minister has insisted he would rather walk away without a deal than sign up to Brussels regulations, mindful of the fact that the political declaration is not binding.
He spent a significant portion of his speech setting out how the UK has higher standards than the EU in many areas and uses state aid for businesses far less than France or Germany, and therefore does not want to be tied to Brussels rules unnecessarily.
Britain also believes the EU is “cherry picking”, turning around a jibe often aimed at London by Brussels, claiming Canada does not have such stringent conditions attached to its trade deal.
The EU, on the other hand, claims Britain’s size, geographic location and economic closeness means a level playing field is vital.
One side or the other will need to make a significant climbdown in this area if there is to be a deal, unless an elegant solution or fudge can be found.
Fisheries
Fishing is perhaps the area where the UK has the most leverage in these talks as its waters feed more Europeans than Brits – and the two sides remain far apart as a result.
The EU wants fisheries to be part of the the overall deal, with access to UK waters for European trawlers and vice versa.
It says a fishing agreement should be based on existing conditions, with “stable” long-term quota shares that take into account “traditional activity” of the EU’s trawlers.
Brussels is also keen to avoid European fishermen and women being left out of work if the UK closes off its waters.
It also wants a deal to be done on fisheries by July 1, as set out in the political declaration.
As with the level playing field, the UK has distanced itself from the non-binding timetable, and insisted fisheries must be dealt with separately from the overarching free trade deal, perhaps to make maximum use of its trump card.
Johnson also insisted there must be annual negotiations on quotas and access so Britain can join Norway, Iceland and the Faroe Islands in being an “independent coastal state”.
Financial services
The EU’s negotiating mandate in this area is vague but Irish PM Leo Varadkar has suggested the UK could get a favourable deal to allow financial services to keep operating in the EU if it makes concessions on fish.
Johnson has called for a “predictable, transparent, and business-friendly environment” for financial services, a key sector in the British economy.
The government has not totally ruled out taking up Varadkar’s offer, suggesting there is room for manoeuvre in this area and on fish.
Gibraltar
The Rock has been the subject of a fierce row between Britain and Spain for decades, with both sides claiming sovereignty over it – and the EU wants to give Madrid a veto over any new rules.
The EU’s negotiating mandate says that whatever overarching trade deal is reached with the EU, Gibraltar will not be included and will be subject to “separate agreements” between Brussels and the UK.
Any separate deals on Gibraltar will also “require a prior agreement of the Kingdom of Spain”, according to the EU document.
Johnson, however, insisted: “The UK will be negotiating on behalf of the entire UK family and that certainly includes Gibraltar, and the sovereignty of Gibraltar remains, as everybody knows, indivisible.”