EU Chief negotiator Michel Barnier inflamed tensions over trade talks by doubling down on demands for Britain to sign up to a string of EU rules.
The UK will be given “super preferential access” only if it agrees to common standards, the chief negotiator said. But No 10 insisted ministers are ready to walk away with a loose trading arrangement if Brussels refuses to budge. Britain’s negotiating mandate, which stretches over around 40 pages, will be published.
A Government source: “We’re not going to be signing up to a level playing field or something which means we won’t be in control of our own borders and laws in the future.
”State aid is obviously another area where we’ll have our own regime.
“On fishing, our position is we take back control of our waters.”
Mr Barnier blamed “social anger” and feelings of abandonment for Brexit.
Speaking at an event in the European Parliament, he said it was “too late” for the EU to tackle the issue in Britain but it must deal with “similar popular sentiment” in some regions across the bloc.
Talks on future relations with the bloc begin on Monday in Brussels.
Mr Barnier said the EU would offer “unprecedented” trading terms if the UK agrees to rules that stop unfair competition.
He warned Brussels would not “take the risk that the UK becomes a kind of assembly hub” for goods from all over the world.
The negotiator also dismissed demands for a Canada-style trade deal “because of Britain’s proximity to the EU”.
He added: “We are ready to offer to the UK super-preferential access to our markets – a level of access that would be unprecedented for a third country.
“Is this something we can do without firm guarantees that the UK will respect the level playing field and avoid unfair competitive advantages? The answer, I’m afraid, is simple. We cannot.
“We want competition in the future but it must be fair – fair and free.”
No 10 said Boris Johnson has a “clear mandate and a set of obligations” based on his election manifesto.
The PM’s spokesman said: “If we are able to get a Canada-style free trade agreement then good but if leave on terms which mean we will be trading with an Australian-style relationship, then that’s fine as well.”
Adrian O’Neill, Irish ambassador to the UK, said it should be possible to reach agreement on a trade deal by the end of the year, even if does not cover all aspects of future EU-UK relations.
“I think it will be challenging to negotiate a deal in that timeframe but I think it will be possible. I think Mr Barnier also thinks it will be possible,” he told BBC Radio 5 Live.
“It may not cover all of the desirable areas that we would like it to cover, it may not be as comprehensive as we would have wished, but I think there is sufficient time, certainly, to negotiate a fair trade agreement.”