What are the sticking points in Brexit talks?
The UK has insisted that it will take back control of its coastal waters from the end of the transition period.
But the EU was demanding its fleets maintain previous levels of access – with Emmanuel Macron under particular pressure from the French fishing industry.
Initially the UK said it wanted to reclaim 80 per cent of the EU quotas from January 1.
However, Brussels suggested that only 18 per cent should be restored.
The two sides are thought to be close to a ‘landing zone’ that includes a transition period, perhaps of five or seven years. However, the UK denies there is a settlement yet.
LEVEL PLAYING FIELD
The EU has insisted the UK commits to ‘level playing field’ provisions, guaranteeing that it will not undercut businesses on the continent with lower environmental standards and regulation.
State aid has emerged as a particular issue, especially as coronavirus puts swathes of the economy unviable.
But the UK says it must regain sovereign powers to decide on rules, even though it has no plans to lower standards or warp competition by subsidising the private sector.
It appeared this area had been resolved in principle last week, before France reportedly laid down a series of extra conditions including huge punishments for breaking the rules.
The enforcement of any deal, and who decides whether rules are broken, has been one of the flashpoints from the start.
Breaking free of the European Court of Justice was among the biggest demands of Brexiteers from the referendum.
But the EU has been pushing to keep control of the governance, as well as insisting on tough fines and punitive tariffs for breaches.
The situation has been inflamed by the row over the UK’s Internal Market Bill, which gives ministers the power to override the previous Brexit divorce terms to prevent blockages between Britain and Northern Ireland.
Critics say that demonstrates why the enforcement mechanisms must be potent.
The pressure is mounting after a frantic 24 hours of talks between the EU‘s envoy and David Frost, with little sign of a breakthrough.
Mr Barnier briefed ambassadors from the bloc early this morning, but sounded a grimly negative tone. Lord Frost merely said he was ‘working very hard’ as he arrived for the latest discussions in Brussels.
Rumours of a new compromise on fishing have been flatly dismissed by the UK, and although Angela Merkel and Emmanuel Macron are said to have weakened demands on level playing field provisions as a ‘final offer’, the standoff remains.
UK government officials indicated that a call between Boris Johnson and EU commission president Ursula von der Leyen this evening will be critical, and did not rule out the PM pulling the plug on talks.
‘It doesn’t sound like it’s going very well,’ one said.
In evidence of the growing friction, UK diplomats have pointed the finger at the Dutch over claims that a deal had effectively been done on fishing.
‘They did it before the issue had even been raised,’ a source told MailOnline. ‘I suppose with the intention of suggesting things were close to an agreement – which they are not.’
There is speculation the Dutch wanted to reduce the pressure for compromise in other areas by suggesting fishing was settled.
Mr Johnson, who infamously vowed to get Brexit done ‘do or die’, has told his chief envoy Lord Frost that he will not sign any deal that binds Britain to future Brussels laws.
Ministers are also pushing ahead with restoring controversial clauses to the Internal Market Bill tonight, which enraged the EU as they would effectively override parts of the previous Brexit divorce terms to prevent blockages between Britain and Northern Ireland.
Cabinet ministers yesterday rallied behind Mr Johnson, insisting that he was not afraid to crash out of the EU Single Market and Customs Union without an arrangement in place by January 1.
Tory MPs also warned the premier this morning that he must not give any more ground, saying the EU was in a ‘hell of a mess’ and France would be forced to climb down.
But the latest iteration of the Cabinet Office’s no deal planning document from September warns of a series of threats from the talks collapsing.
They include a medicine supply shortage and a fuel shortage, rising food prices, public disorder and increased risk of terrorism, clashes with EU trawlers and border disputes and tariffs.
The memo indicates that some Cabinet ministers remain nervous about the impact of no deal on Britain as it grapples with economic devastation inflicted during the pandemic, with one source telling the Mail: ‘The possibility of chaos at the border has been significantly underpriced if talks collapse.’
British officials were stunned by a hardening of the EU’s negotiating stance last week, and hit out at Mr Macron for threatening to veto any deal that conflicts with French interests.
He also wants any post-Brexit agreement to include the power to levy tariffs if the UK fails to stick close to EU rules on issues such as employment rights and the environment.
According to The Times Mrs Merkel and Mr Macron have come together to make a ‘conciliatory’ final offer, watering down demands for a so-called ‘level playing field’ on certain issues between the UK and the EU.
But it is said to have been delivered alongside a warning from Mr Macron that he is on the verge of abandoning talks so France can prepare for no deal.
Ireland, which has most to lose from a failure, yesterday appealed to both sides to keep talking, and a close ally of Mr Macron acknowledged that Mrs Merkel was pushing for an agreement.
Boris Johnson (pictured left on a visit to Uxbridge police station with Tory mayoral candidate Shaun Bailey, right) is preparing for what could be a make-or-break call with EU commission chief Ursula von der Leyen tonight
A 34-page ‘reasonable worst-case scenario’ dossier sets out what No10 believes could happen in the event that Britain crashes out of the EU in the New Year without a trade deal in place
Negotiations between Lord Frost (right) and his EU counterpart Michel Barnier (left) resumed this morning after making ‘no progress’ over the past day
Pound slumps on fears talks will collapse
Sterling was down more than 1 per cent against the US dollar this morning
The pound slumped to its lowest level for weeks today amid gathering gloom about Brexit trade talks.
Sterling was down more than 1 per cent against the US dollar amid fears Boris Johnson could pull the plug within hours.
The sharp fall was a complete U-turn in sentiment from Friday when sterling rose above $1.35 for the first time this year.
Lord Frost is resuming talks with Mr Barnier in Brussels this morning, after travelling to the Belgian capital yesterday for what government sources described as a ‘final throw of the dice’.
One source said Mr Johnson was ready to walk away as early as tonight unless the EU backed down, adding: ‘It’s fair to say the Prime Minister isn’t bluffing. It’s pretty clear we will leave on No Deal terms if the EU can’t accept that we will be an independent nation.
‘There won’t be any agreement if the EU do not recognise this reality. We’ll only keep talking if there is some movement and if we think there’s any point.’
An ally of the Prime Minister said he was ‘bullish’ about the UK’s prospects outside the EU, with or without a trade deal.
A senior Downing Street figure yesterday said the chances of a deal were ‘at best 50:50’. Another insider put the figure at just 30 per cent.
Mr Coveney told reporters that Mr Barnier gave a ‘very gloomy, downbeat’ assessment in his briefing this morning.
‘There really was no progress made yesterday, so we’ve got to try to make a breakthrough at some point today,’ the Irish minister said.
Dublin’s EU commissioner Mairead McGuinness was even blunter, saying: ‘No, it’s not looking good and the reason it’s not looking good is that the UK are failing to understand the significance of the three outstanding issues and the need for the UK to compromise.’
In a round of interviews this morning, Foreign Office minister James Cleverly said the possibility of a no-deal Brexit should not be viewed as ‘Armageddon’ and urged the EU to display more flexibility.
‘Countries can trade perfectly well without a formal trade agreement, as Australia does with the EU,’ the foreign minister told LBC.
‘There have been people trying to paint the idea of us leaving without a trade agreement as some kind of Armageddon.
‘It is less preferable than having a trade agreement but … you can trade successfully with the EU without a formal trade agreement .
‘If that’s what we have to do then that’s what we have to do, but we are in a position where we can do something better if the EU displays a little bit of flexibility and adaptability in these final hours or days of negotiations.’
Striking a slightly more optimistic note, Mr Cleverly said the pressure of an imminent deadline ‘tends to focus the minds’ of negotiators on both sides of the table to ‘get things over the line’.
He also claimed that the UK ‘holds all the cards’ in the Brexit process.
‘Outside the EU we can actually sign trade agreements more quickly with more countries than previously, so we do indeed hold all the cards,’ he said.
‘I think if the EU recognise this they will see that actually making a few small but significant concessions can get this deal done and that will be in their interest and in our interest.’
Mr Johnson will tonight ask Tory MPs to reinsert controversial clauses in the Internal Market Bill, which were thrown out by the Lords after ministers admitted they would break international law.
Mr Johnson speaking to Ms von der Leyen last week, when they decided that negotiators should be given one last chance to find a way through the impasse
British negotiators were left stunned by a hardening of the EU position at the behest of French President Emmanuel Macron, who said he’d veto any deal that threatened French interests
Cabinet Office minister Michael Gove is in Brussels today to meet his counterpart on the UK-EU joint committee Maros Sefcovic, as they try to defuse the linked row over the Internal Market Bill
Cabinet Office plan warns of No Deal dangers
The UK could be overwhelmed by public disorder, drugs and fuel supply shortages and rising food prices in the event of a No Deal Brexit, a leaked Government document reveals, as talks teeter on the brink of collapse.
The latest version of a 34-page ‘reasonable worst-case scenario’ dossier sets out what No10 believes could happen in the event that Britain crashes out of the EU in the New Year without a trade deal in place.
It says ‘flow rates of medicines and medical products could initially reduce to 60-80% over three months which, if unmitigated, would impact on the supply of medicines and medical products across the UK’.
The document also warns of ‘protests and counter-protests’, a clash between British and EU fishing trawlers, ‘price rises in food and fuel’ caused by ‘reduced [food] supply availability’, and an increased risk of terrorism.
The leak comes after a ‘bullish’ Boris Johnson told his chief envoy David Frost he will quit Brexit talks within 48 hours unless the EU drops ‘ludicrous’ demands that would curb UK independence.
No10 is planning for a number of crises – from food and drug shortages to civic unrest – if the UK exits the Single Market and the Customs Union without a trading arrangement in place by January 1.
Other concerns include border delays and tariffs leading to the disruption to the supply of critical chemicals, a fuel shortage, and a reduction in the supply of medicines for UK veterinary use which would limit the Government’s ability to prevent and control disease outbreaks.
The top-level document warns that up to 70 per cent of trucks travelling to the EU ‘might not be ready for new border controls’ – which could reduce flow across the short Channel crossing to 80 per cent of normal levels.
Mr Barnier has warned such a move would put the talks in crisis.
Downing Street claims the measures are needed to stop the EU driving a wedge between Northern Ireland and the rest of the UK under No Deal.
Cabinet Office minister Michael Gove will meet his counterpart on the UK-EU joint committee Maros Sefcovic in Brussels later to try to defuse the row over the legislation.
A spokesman said: ‘The Chancellor of the Duchy of Lancaster will meet Vice President Sefcovic today in Brussels to discuss issues related to their work as co-chairs of the Withdrawal Agreement joint committee.
‘The Withdrawal Agreement joint committee oversees UK and EU implementation, application and interpretation of the Withdrawal Agreement, including the Northern Ireland Protocol.
‘The work of the joint committee is separate from the ongoing FTA negotiations.’
Mr Johnson has pencilled in another phone call with European Commission chief Ursula von der Leyen this evening to discuss whether talks are worth continuing.
A No 10 source confirmed the drawn-out negotiations were ‘entering the last 48 hours’.
Cabinet ministers yesterday backed the PM to pursue No Deal if talks collapsed, saying he had a mandate to ensure Britain took back control of its laws. But many remain nervous about the impact of No Deal on a fragile economy.
A leaked official document setting out the Government’s ‘reasonable worst case scenario’ for No Deal warned it could see severe disruption of vital supplies, including medicine.
Environment Secretary George Eustice acknowledged that tariffs under No Deal would lead to higher food prices, but insisted the rise would be modest.
In a series of interviews yesterday, he accused the EU of introducing ‘a whole load of additional demands’ late in the day, adding: ‘There is no point denying that what happened late last week was a setback.’
He described the EU’s demands on fishing as ‘ludicrous’, saying they would make a mockery of Britain’s newfound status as an independent coastal state.
He said the PM was willing to give assurances that the UK would not slash standards in environmental protection and employment rights.
But he said Mr Johnson would never sign off a deal that met Mr Macron’s demand for Britain to continue following EU rules in future.
Eurosceptic MPs yesterday piled pressure on the PM not to back down. Former Brexit minister David Jones, who is a member of the European Research Group of MPs, tweeted: ‘Total confidence in David Frost and the UK negotiating team to stay steadfast in pursuing a fair free trade agreement that respects UK sovereignty. We must settle for nothing less.’
Fellow Tory Andrew Bridgen has said the PM would be ‘finished’ if he signed a deal that failed to guarantee independence.
Former Treasury mandarin Nick Macpherson said the bust-up with France had the hallmarks of the kind of confected row that often precedes a settlement.
‘The UK needs a deal. The EU wants a deal,’ Lord Macpherson added. ‘To convince their constituencies, there has to be a lot of drama in the coming days.
‘But there will be one. There always is – unless one of the parties makes a gross miscalculation.’
EU leaders are due to hold a summit on Thursday, which is seen as the last chance to sign off a deal.
France’s Emmanuel Macron wants any trade agreement to include the power to levy tariffs if UK fails to stick close to EU rules on issues such as employment rights and the environment
President Macron acknowledged that Angela Merkel of Germany (pictured) was pushing for an agreement
EU is at war over No Deal Brexit: As Emmanuel Macron plays hardball, Ireland warns of ‘very, very costly’ failure to strike a trade agreement… and even Angela Merkel is not on board
British officials claim the French president derailed progress last week by forcing EU negotiator Michel Barnier to toughen his stance at the last minute.
But with time running out European leaders warned it was vital to strike a trade agreement.
Emmanuel Macron is facing pressure from EU leaders to back down on Brexit as talks continue
Angela Merkel does not endorse France’s hardline stance on state aid, workers’ rights and environmental standards
Ireland’s premier, Micheal Martin, said he felt a deal would be reached because the alternative would be ‘damaging to all concerned’.
The country’s foreign minister, Simon Coveney, said any other outcome made ‘no sense’ for either side.
Mr Coveney, whose country faces the most severe repercussions from No Deal, said failure would be ‘very, very costly and very, very disruptive’.
He added: ‘That, in the context of a post-Covid world which is hugely challenging economically for everybody, doesn’t make any political sense and it certainly doesn’t make any economic or social sense either.
‘For all of those reasons, I think the negotiating teams and senior politicians will find a way of getting a deal here, but at the moment we are in a difficult place as we try to close it out.’
Ireland’s premier, Micheal Martin, said he felt a deal would be reached because the alternative would be ‘damaging to all concerned’
France’s Europe minister yesterday acknowledged that some other EU leaders – including Germany’s Angela Merkel – did not endorse France’s hardline stance on state aid, workers’ rights and environmental standards.
In an interview with Journal du Dimanche, Clement Beaune said: ‘There are different sensitivities across the 27 EU countries. It would be naive to deny it. But the negotiating mandate is detailed and we are sticking to it.
Sovereign Britain could ban fur
Fur sales could be banned from next year when the Brexit transition period ends, the Environment Secretary said yesterday.
George Eustice said he was ‘looking at’ plans to become one of the first countries in the world to bring in the ban.
The issue is close to the heart of Boris Johnson’s fiancée Carrie Symonds and has been championed by Tory peer Zac Goldsmith, an environment minister.
The UK was the first country in Europe to ban fur farming in 2000, but sales of some furs are still legal here and across the EU.
Once the UK leaves the single market, it will be able to unilaterally ban them.
‘We’re looking at a number of issues in the animal welfare sphere. Yes, fur is one area,’ Mr Eustice told Times Radio.
The British Fur Alliance said it will fight any move on a ban, arguing that natural fur is an antidote to fast fashion and, if ethically sourced, should not be prohibited.
‘As for Chancellor Merkel, she wants a deal, but she also defends our demands – and she knows the European market well enough to guess how the German economy would suffer from a bad deal. In short, the British gamble on trying to divide the EU has failed.’
On Friday, Mr Beaune warned that President Macron was ready to veto a deal if it fell short of French demands.
But yesterday he said France was willing to contemplate the UK being free to diverge from EU standards – provided Brussels is able to take ‘corrective measures’ if the differences become too great.
‘The British want access to the single European market without constraints for their social, environmental or health standards, which is unacceptable,’ he said. ‘For our part, we are ready to put in place a system in which a divergence of standards would be allowed but beyond which corrective measures would be taken.
‘The British tell us that this is unfair because other ‘third countries’ do not have these same constraints, such as Canada. But we have to realise that the UK will be our major trading partner outside the EU tomorrow. There is ten times as much trade between the EU and UK than with Canada.’
France has some support from other coastal states, such as the Netherlands and Belgium, which are also concerned about their domestic fishing industries.
But other member states, led by Germany, are anxious to avoid a destabilising No Deal outcome at a time when the continent is already facing a double-dip recession as a result of the pandemic.
In a further sign of EU tensions, the Netherlands last night suggested it was ready to compromise on fishing rights.
But government sources said the Prime Minister would not accept Mr Macron’s demands on the so-called level playing field, where he is pushing for Brussels to have the power to impose immediate tariffs if the UK moves too far from EU regulations in future.
Gavin Barwell, who was Downing Street chief of staff during Theresa May’s premiership, said: ‘Some in the EU think the UK will be forced back to the negotiating table.
‘But there is a real danger that if we don’t get a deal now we will have significant damage to the relationship which takes some time to put right.’
Mr Barnier is to brief EU ambassadors this morning after trade talks reopened last night.
Unite union chief Len McCluskey says Sir Keir Starmer can’t shirk key Brexit vote if an agreement is reached
By Claire Ellicott Political Correspondent for the Daily Mail
Sir Keir Starmer came under pressure from Labour’s biggest union backer last night to support a Brexit deal if an agreement is reached.
Unite boss Len McCluskey warned him not to sit on the fence – but Labour frontbenchers yesterday kept to the party line, refusing to rule out abstaining on a future vote on a Brexit deal.
Sir Keir has a difficult task in uniting his party’s hard core of Remainers with the Labour heartlands in the North which backed Brexit and switched to the Tories in the last election.
Unite boss Len McCluskey warned Sir Keir Starmer not to sit on the fence in the upcoming Brexit vote
Sir Keir has a difficult task in uniting his party’s hard core of Remainers with the Labour heartlands in the North
Strewth! PM’s Rolf Harris hint
Boris Johnson has taken to singing ‘Tie Me Kangaroo Down, Sport’ in an apparent hint he is ready to embrace an Australian-style No Deal Brexit.
Downing Street insiders say the Prime Minister has been heard to sing the chorus of the Rolf Harris hit when asked about Brexit talks.
Yesterday it emerged he was overheard singing ‘Waltzing Matilda’ last week after being warned the negotiations had taken a turn for the worse. The songs are thought to be light-hearted references to an ‘Australian-style’ arrangement, which is now government code for No Deal. That term has been banned due to negative connotations among some voters.
Instead the PM has spoken about an ‘Australian-style deal’ – although the country has no free trade pact with the EU. Instead, it trades using World Trade Organisation terms – but is seeking a deal with Brussels.
Mr McCluskey yesterday said it would be ‘completely wrong’ for Labour not to vote one way or the other as Brexit was the ‘most important issue of the day’.
Football pundit Gary Neville also weighed in, accusing the party of ‘sitting in the stands’ by abstaining over the tier system last week.
Mr McCluskey said Sir Keir needs to ‘win the trust of the Red Wall seats’ which switched to the Tories in the North.
He said the Labour leader should not be seen to be ‘standing in the way’ of what the Red Wall voted for but should oppose any deal that is not good enough.
‘On the other hand if it’s a thin deal – which I suspect it will be, if indeed we get a deal – he needs to also be in a position in six months if things are going wrong to be able to attack the Government without then being regarded a hypocrite because he voted for the deal,’ Mr McCluskey told Times Radio. Pressed on the issue of Labour voting for a deal, Mr McCluskey replied: ‘Yes, in my opinion let’s get Brexit done and out the way, it won’t stop us being critical if indeed the deal gives us all kinds of issues and problems going forward.’
Sir Keir’s position is to wait to see what Brexit deal Boris Johnson negotiates – a stance his frontbenchers echoed yesterday, as they refused to rule out abstaining on a vote.
Shadow Cabinet Office minister Rachel Reeves said ‘let’s see’ when asked whether Labour would back any future Brexit deal.
Nick Thomas-Symonds, shadow home secretary, said it would be ‘responsible’ for the party to consider any deal agreed.