1/ The EU has agreed to water down its demands for 'cross retaliation' clauses as part of the governance talks. Michel Barnier has accepted that police and judicial cooperation should be exempt from the cross-retaliatory tools in any post-Brexit trade and security deal.
2/ The UK is pushing back against EU plans for an extensive dispute settlement clause that would allow for 'cross suspension' across the Brexit deal, for example a row over fisheries could see tariffs slapped on cars if arbitration fails.
3/ British negotiators have accepted the dispute settlement for goods and services, but not the level-playing field and fisheries, according to EU sources. The EU wants fish, energy, goods, services, road & air transport and the LPF covered by the mechanism.
4/ However, progress is being made. There is a joint text being drawn up. But it's still described as a 'serious problem' by EU sources close to the talks. 'The UK has refused a dispute settlement mechanism that is robust and obligatory for all areas,' one said.
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