The UK and the EU are set to resume talks on post-Brexit trade later, with time running out to achieve a deal.
A senior UK government source said the prospects of a breakthrough were “receding” and accused Brussels of making new demands over business rules.
But a Brussels source denied this, with EU chief negotiator Michel Barnier calling Friday an “important day”.
Both sides have to agree and ratify any deal by 31 December, when the current rules on EU-UK trade end.
If they do not, they will do business on World Trade Organization rules, meaning the introduction of tariffs.
The UK and EU teams, meeting in London, are urgently seeking compromises in key areas, including fishing rights and business competition rules, ahead of an EU summit scheduled for Thursday.
Rather than return to Brussels as planned on Friday, Mr Barnier will now stay in London to continue discussions.
Business Secretary Alok Sharma confirmed to BBC Radio 4’s Today programme the talks were “in a difficult phase”.
He added that the UK had “said all along” that it wanted the EU to recognise it as “a sovereign and independent nation” and it was “on the basis of that that a deal will be done”.
France’s Europe minister, Clement Beaune, said his government could “veto” any deal reached, if it did not satisfy his country’s demands, particularly on fishing rights – an area of contention between France and the UK.
“If there’s a deal that isn’t a good one, we’d oppose it,” he told Europe 1 radio.
With Brexit, talks don’t just go to the wire. They go beyond it.
Remember, the UK left the EU nearly a year after it was intended. So the fact it’s taking this long to reach a trade deal shouldn’t come as a shock.
But there really is pressure in the next few days to declare “deal or no deal”.
On Monday, the Internal Market Bill returns to the Commons. It would allow the UK to sidestep aspects of the agreement that was reached to leave the EU – and break international law in a “limited and specific way”.
Brussels has warned the government that this could scupper a trade deal.
That aside, any deal would have to be ready before EU leaders are invited to sign it off at a summit on Thursday.
It doesn’t augur well that the UK and EU are even disagreeing about their disagreements.
The government says Brussels has hardened its position on how competition rules are policed; the EU counters that it has made no new demands.
But it’s not surprising that both sides are crying “ouch” as the thorniest issues are now being grasped.
But while No 10 talks of “setbacks”, it hasn’t yet said negotiations have broken down. While discussions between both sides continue, the prospect of a deal is still possible.
But European Council President Charles Michel urged the EU’s 27 member states to maintain “unity” as negotiations continue.
“It’s unfortunate it took longer than planned, but we’re still currently negotiating,” he added.https://emp.bbc.co.uk/emp/SMPj/2.36.6/iframe.htmlmedia captionBusiness Secretary Alok Sharma said “time is short” on Brexit negotiations
Any deal would have to be signed off by the European and UK Parliaments before it can come into force. It could also require eventual ratification in the 27 EU national parliaments, depending on the contents.
On Thursday, a senior UK government source accused the EU team of “bringing new elements into the negotiation” at the “11th hour”, adding that a breakthrough was “still possible in the next few days but that prospect is receding”.
And an EU source said talks were “extremely sluggish” around the so-called level playing field for competition rules and standards while another EU insider suggested the UK was “posturing”.
The UK and EU have been in negotiation since March to determine their future relations once the UK’s Brexit transition period – under which is still follows most of the EU’s rules – ends in less than four weeks’ time.
The UK government is under pressure to conclude a deal by early next week to have time to turn it into law before the end of the year.
Brexit – The basics
- Brexit happened but rules didn’t change at once: The UK left the European Union on 31 January 2020, but leaders needed time to negotiate a deal for life afterwards – they got 11 months.
- Talks are happening: The UK and the EU have until 31 December 2020 to agree a trade deal as well as other things, such as fishing rights.
- If there is no deal: Border checks and taxes will be introduced for goods travelling between the UK and the EU. But deal or no deal, we will still see changes.
On Thursday, Labour leader Sir Keir Starmer said he was “consulting across” the party on whether his MPs should back a deal if it comes to a vote in the House of Commons, and would decide after examining the contents of the deal.
The government has not confirmed how it intends to ratify a deal in Parliament.
But the UK’s chief negotiator, Lord Frost, has said he assumed MPs would have to approve a law to implement “at least some elements”.
The EU-UK talks are continuing ahead of a politically sensitive moment next week, when a controversial piece of Brexit legislation returns to the Commons.
The Internal Market Bill, which would allow ministers to override sections of the UK’s withdrawal agreement, will come back before MPs on Monday.
The publication of the bill in September led to the EU Commission beginning legal proceedings against the UK.
Commons Leader Jacob Rees-Mogg confirmed the government intended to reinsert contentious clauses taken out of the bill by the House of Lords.
And then on Wednesday, MPs are also set to vote on a new taxation bill that will reportedly contain similar powers to override the withdrawal agreement over the issues of customs and VAT.
Why is fishing so important?
Fishing is a tiny part of the overall economy on both sides of the Channel, but it has a political importance which allows it to punch well above its weight in these negotiations.
It was a big part of the Leave campaign in the run-up to the Brexit referendum in 2016, and it is a totemic issue for those who argue that national sovereignty must be fully regained.
But it’s a sensitive issue in other countries as well. French President Emmanuel Macron will want to win regions with big fishing communities in the next presidential election in 2022. And any proposed deal needs the agreement of all EU countries – it can’t just be signed off by the European Commission.
Many fishing communities in the UK hate the EU’s Common Fisheries Policy – they say they have had a bad deal for decades.
But there are plenty of people involved in the fishing industry who are worried that no deal will mean they will lose access to European markets, where they sell most of their fish.