The latest round of talks between the UK and EU to reach a post-Brexit trade deal have ended with "substantial areas of disagreement" still remaining, the UK's chief negotiator has said.
David Frost said “considerable gaps remain in the most difficult areas” following the talks in London. Mr Frost’s EU’s counterpart, Michel Barnier, said a trade agreement “at this point” is “unlikely”.
David Frost released a statement following talks with Mr Barnier, in which he said "it is unfortunately clear that we will not reach in July" the deadline both sides had set for an "early understanding on the principles underlying any agreement”.
ITV News Correspondent James Mates on the latest developments:
Ahead of talks commencing, Boris Johnson said any deal must include:
No role for the European Court of Justice in Britain
The right to determine future UK laws without constraints
An agreement on fisheries allowing only UK fishers to use British waters.
Mr Frost said "the EU’s proposals so far, while a welcome response to the prime minister’s statement, do not do so, and therefore substantial areas of disagreement remain".
He said several agreements had been reached, notably on transport and participation in EU programmes, but he added "considerable gaps remain in the most difficult areas, that is, the so-called level playing field and on fisheries".
Mr Barnier said there is “objectively” a risk of a deal not being reached, with the UK’s position on fisheries is “simply unacceptable”.
He said: “On fisheries, the UK is effectively seeking for near-total exclusion of fishing vessels from the UK’s water. That is simply unacceptable.”
Mr Barnier said considerable gaps remain between the UK and EU on the so-called “level-playing field” arrangements.
He added: “This week again the UK did not show a willingness to break the deadlock.
“On the level-playing field the UK still refuses to commit to maintaining high standards in a meaningful way. On state aid, despite a clear warning in the political declaration, very clear, we have made no progress at all.
“This is all the more worrying because we have no visibility on the UK’s intention on its future domestic subsidy control system and regime.”
The idea of a level playing field is designed to ensure fairness between the two sides in areas such as labour, environment, climate, sustainable development and subsidy control.
He said the EU and UK have until “October at the latest” to strike a deal or risk the imposition of quotas and tariffs.
He said: “If we do not reach an agreement on our future partnership there will be far more friction."
But Mr Frost's statement shows no sign of any desire to compromise on the three principles outlined by the PM.
He said: "We have always been clear that our principles in these areas are not simple negotiating positions but expressions of the reality that we will be a fully independent country at the end of the transition period."
The negotiator and close Boris Johnson ally said there has been "constructive discussions on trade in goods and services", adding how he will "keep working hard to bridge the gaps and find a way through".
Mr Barnier said if an agreement isn't reached on trade, new tariffs and quotas will be inevitable.
“This is the truth of Brexit… and I will continue to tell the truth.
“If we want to avoid this additional friction we must come to an agreement in October at the latest so that our new treaty can enter into force on January 1 next year.
“This means that we only a few weeks left and that we should not waste it.”
Despite Mr Barnier saying a deal must be reached by October, Mr Frost believes one could be reached by September.
The UK’s chief negotiator said: “Despite all the difficulties, on the basis of the work we have done in July, my assessment is that agreement can still be reached in September, and that we should continue to negotiate with this aim in mind.”
But he added: "Obviously we must prepare for every outcome and it is possible that we won't reach agreements."
He ltold the media that the EU would have to accept the UK’s right to be an “independent state” for this to be achieved.
Mr Frost said: “When we began this intensified negotiating process a month or so ago the Prime Minister set out the principles to Commission president Ursula von der Leyen that were intrinsic to our status and future as an independent state.
“And the EU has heard some of that but it hasn’t heard all of it and the big underlying difficulty is the fact (the EU) hasn’t yet recognised it needs to adapt its position to those principles if we’re going to reach an agreement.”
He added: “Until the EU has internalised and accepted that we will be an independent state with the right to determine our laws, control our own fishing grounds then it will be difficult to reach an agreement.”