Boris Johnson will decide after the conclusion of a crunch EU summit on Friday whether to press ahead with trade negotiations with the EU or walk away with no deal, Downing Street has said.
The announcement amounts to an admission that Mr Johnson has missed his self-imposed deadline of 15 October to seal a deal, and that there will be no breakthrough in talks with the presidents of the European Commission and European Council this evening.
A source close to the talks has said that UK chief negotiator David Frost will advise Mr Johnson to stay at the table in the hope of a deal before the transition to post-Brexit arrangements on 31 December.
But it is understood that the PM wants to take account of the conclusions of this week’s European Council and the tone taken by EU leaders at the summit on Thursday and Friday before deciding on how to take the Brexit process forward.
The prime minister said in September that he saw little point talking through autumn, and that if there was a deal to be done it would emerge by this week’s summit.
The PM’s official spokesman said: "Some progress has been made this week, primarily in technical areas of the negotiations.
"But there are still differences, with fisheries being the starkest. We need to get substance settled and not having a common text to work from has made progress doubly difficult
“The prime minister’s 7 September statement was very clear about the significance of 15 October. He will need to take a decision on next steps following the European Council in the light of his conversation with President (Ursula) von der Leyen, and on advice from his negotiating team. I cannot prejudge what that decision will be.”
It is understood that the UK side have been pushing to intensify talks over the last few weeks to make the final push for an agreement, and have been frustrated by what they see as a lack of ambition from Brussels.
A particular bone of contention has been the EU’s refusal to discuss legal texts of the agreement which both sides have said they want to reach by the end of 2020 - less than 80 days away.
Talks have heated up in the last few days, with both sides trading accusations. UK government sources on Tuesday accused the EU of following their standard “playbook” and trying to “run down the clock” by not engaging on issues like fishing.
But senior EU figures have equally warned that a deal can only be done if Boris Johnson decides he wants to do one. Dacian Ciolos, Emmanuel Macron’s top MEP in Brussels, on Monday told The Independent the PM needed to “step up to the crease”.
With both sides digging their heels in, publicly at least, there was little expectation of any breakthrough in Mr Johnson’s talks with Ms von der Leyen and Council president Charles Michel this evening.
A draft version of the summit conclusions on Brexit circulated by Brussels backchannels ahead of the meeting says that "progress on the key issues of interest to the union is still not sufficient for an agreement to be reached"
Despite steady progress on minor side-issues, two major sticking points remain before a free trade agreement can be reached. The first is the extent to which EU fishing fleets will have access to UK waters, and the second is the so-called “level playing field” of regulations.
The UK has in particular refused to play ball on the question of state aid rules, where Downing Street is thought to want more flexibility than European rules allow.
Britain left the EU in January but remains in the single market and customs union until the end of this year.
This second “economic” Brexit is expected to be more noticeable than the first “political” Brexit - with disruption to trade flows expected whether a deal is reached or not.
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