Brexit trade talks halted amid 'significant divergences'

Brexit trade talks have had to be halted after negotiators in London and Brussels failed to reach an agreement. Both sides have insisted that there are “significant divergences”.

Michel Barnier and David Frost said conditions for a deal between the two sides have not been met.

State aid subsidies, fishing and enforcement of new rules remain the key sticking points in negotiations.

“We agreed to pause the talks in order to brief our principles on the state of play of the negotiations. President von der Leyen and prime minister Johnson will discuss the state of play tomorrow afternoon,” they said.

Boris Johnson and Ursula von der Leyen, the president of the European Commission, will discuss the “state of play” in a telephone call on Saturday with just weeks remaining until the end of the transition period.

If a deal is not agreed by 31 December, the two sides will trade on World Trade Organization rules, meaning the introduction of taxes on imports.

Significant disruption is expected even if an agreement is signed, but the economic impact from a no-deal would be detrimental.

Mr Barnier is negotiating on behalf of the 27 EU member states and can only act within the mandate set by their leaders.

Questions also remain on the EU side as to whether all EU member states could back any emerging deal, with Emmanuel Macron’s France leading a group of other more sceptical countries such as the Netherlands and Belgium.

Clément Beaune, a close ally of the French president, Emmanuel Macron, threatened a French veto amid divisions among the 27 member states over the necessity of a deal this year, but hinted at a compromise on the thorniest issue.

“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," he added.

The Irish Prime Minister Micheál Martin said it was important for the 27 EU member states to give negotiators "the space to conclude these talks". He added that he "fervently hoped" a trade deal can be agreed.

Mr Michel, a former Belgian prime minister whose job is to speak for member state governments collectively, added: “If one side of the table rejects [a tentative agreement], it’s a no-deal. We will need to assess what will be probably on the table.”

A No 10 spokesman said: “We are committed to working hard to try and reach an agreement with the EU and the talks are ongoing. There are still some issues to overcome. Time is in very short supply and we are at a very difficult point in the talks.