Brexit: UK and EU 'some way from deal' with key talks ‘only just beginning’

New UK offer to limit future state aid - a Brussels red line - is ‘not an extensive text’….with no ‘details’ for months

Talks on the key obstacle to a Brexit agreement are “only just beginning”, the UK’s chief negotiator says – warning the two sides are “some way from a deal”.

David Frost revealed a new UK offer to limit future state aid, put forward last week, is “not an extensive text” and that “details” will not be produced until next year.

“We are some way from a deal at the moment, if I'm honest,” he told a Lords inquiry – with the date for the UK to crash out of the transition period less than three months’ away.

Lord Frost also did not deny that vital security data – to target terrorists and organised criminals – will be automatically “deleted” if it ends in a no-deal Brexit.

But he insisted the UK would not shut the door to a deal, even if Boris Johnson’s deadline of mid-October is missed, saying: “Our door would never be closed.”

Michael Gove, the prime minister’s effective deputy, pointed to tensions as he attacked the portrayal of the EU as “upholders of virtue” – with the UK as a “potential rogue”.

He admitted the extra red tape for business – even if a deal is reached, outside the single market and customs union – mean there was little difference from a no deal.

And he refused to commit to withdrawing the clauses in the Internal Markets Bill that break international law, even if the EU backed down, saying: “Wait and see.”

The comments came as the EU’s team arrived in London for fresh talks, due to last until Friday, with more negotiations in Brussels next week, before the EU Council.

Both sides are now resigned to talks continuing long beyond that summit on the 15th – long pinpointed as the deadline – if a trade agreement is to be struck.

Crucially, the EU has attacked the UK for failing to explain how it will regulate state aid, or settle disputes, in order to deliver the ‘level playing field’ Mr Johnson signed up to a year ago.

The comments came as the EU’s team arrived in London for fresh talks, due to last until Friday, with more negotiations in Brussels next week, before the EU Council.

Both sides are now resigned to talks continuing long beyond that summit on the 15th – long pinpointed as the deadline – if a trade agreement is to be struck.

Crucially, the EU has attacked the UK for failing to explain how it will regulate state aid, or settle disputes, in order to deliver the ‘level playing field’ Mr Johnson signed up to a year ago.

Speaking to the Lords EU committee, Lord Frost accepted the UK had to deliver a regime “compatible” with the EU’s – even after Brussels dropped its demand for “dynamic alignment” with its own.

“We are only just beginning a discussion about [if] is it possible to go further than you normally do in a free trade agreement,” he acknowledged.

The debate was about “high level principles”,” he said, adding: “I don't think we are thinking in terms of extensive text, setting out the detail of how we design our system.

“That will be for the consultation that will come later this year, or early next, and the legislative process.”

However, Lord Frost hinted at attempts to reach a fudge to avoid the worst impacts of a no-deal – even if a full trade deal proves impossible – saying there would be “lots of practical matters that we would need to cover”.