1/ This week's Brexit talks ended with no new progress, I am sure everyone will be shocked to hear. There is much puzzlement on this side of the Channel about what the UK side's game is. But perhaps more surprisingly, all is not quite as grim as it seems. thesun.co.uk/news/brexit/12…
2/ The puzzlement. This week's round was a repetition of previous ones, with no new ideas tabled. The UK is insisting on rapid progress and wants a joint outline of the deal by the end of the month. This urgency is much appreciated by the EU side which also seeks rapid progress.
3/ But Brussels is bewildered this emphasis on speed hasn't been accompanied by any UK attempt to break the deadlock. Talks are just 'going in circles' and 'wasting time'. Source: 'You'd expect at least discreetly they'd be telling Barnier we understand we'll need to compromise.'
4/ Barnier has made numerous overtures. He's tabled middle ground proposals on fish. He's accepted the EU's demand of dynamic alignment on state aid isn't a goer, and acknowledged the UK's objections to the ECJ having a role in the trade deal. The EU feels it's made its move.
5/ To each of these overtures, the EU says it's had no reply. On fishing the UK sticks to pure zonal attachment, which produces 'disastrous' numbers for EU states. Barnier has repeatedly asked for the UK's plans for its post-Brexit state aid regime but has been met with silence.
6/ The UK has even refused to engage on non-regression of environmental and labour law, which it proposes in its own negotiating mandate. All this has the EU baffled. A source says: 'The mood music is frustrated because on a technical level quite a lot of things have been done.'
7/ All of which sounds pretty grim. Yet time after time people here tell us a deal isn't that hard to reach, it can and should be done. There are good reasons why nobody is slipping into despair yet. The two sides agree on about 80 per cent of what will go into the final text.
8/ A lot of this confidence is rooted in the conviction Boris wants a deal. The EU side very much gets the sense the UK wants Brexit over and done with in the Autumn and to move on. So it fails to see why the PM would want to 're-politicise' the whole thing by going for no deal.
9/ From that point of view the landing zones are there to see once the UK shifts from its starting positions. The UK fleet can't catch all the fish in its waters and needs market access to the EU. Plus, any final compromise would be a big win for the UK compared to the present.
10/ On the Level Playing Field, state aid is seen as crucial. The EU will push hard here to keep the UK as close to its rules as it can through some form of independent arbitration. But 'once you get over the state aid hurdle things will start to fall together' on non-regression.
11/ Governance is not seen as a deal breaker and is one area where there is slight movement. The EU sees the end game being an overarching deal with bolt-on supplementary agreements. The big issue here is cross-retaliation - the EU insists on it, but it's a no-no for the UK.
12/ This is important on access to waters. The EU wants a fisheries deal in the main agreement, the UK says it must be separate. This is because if the UK does ever shut out EU boats, Brussels wants to be able to hit it with more than just tariffs on UK fish products in reply.
13/ Finally, security cooperation. This is where the two sides are closest to a breakthrough and there are hopes of progress at next week's talks. There are two big stumbling blocks: 1. UK application of ECHR and 2. UK proposing lower data protection standards than the EU's.
14/ The UK has proposed for access to databases like Passenger Name Record it uses its own data standards. EU sources say they'd be 'significantly lower' and have explained this isn't possible because the ECJ would strike the deal down. Belief is this is to do with UK-US ties.
15/ Also, the UK is insisting the governance structure that would apply to the FTA doesn't cover to any security pact. The EU sees this position as 'ludicrous' as you're dealing with people's personal data and fundamental rights. But ultimately it thinks the UK will come round.
16/ All in all, the EU expected talks to run to Sep/Oct so they're still on track. People put the chances of a deal at over 50/50 and feeling is if the UK starts to engage things could move pretty quickly. But for now we're deadlocked. Roll on next week's full round in London.
