Brexit: UK and EU edging closer on state aid talks, says David Frost
The UK and EU are finally beginning to make progress in the contentious area of state subsidies during Brexit trade talks, according to Britain’s chief negotiator Lord David Frost.
Frost said today that talks with Brussels on state aid had been “somewhat more constructive” in recent weeks after “a long period in which we’ve been making little progress”.
However, Frost added that there is still a lot of work to be done in this area for a trade deal to be closed by the end of the month.
Boris Johnson and European Commission President Ursula von der Leyen agreed over the weekend to extend talks until the end of October in the hope of closing a deal before the UK leaves the EU customs union and single market on 31 December.
However, the Prime Minister has told Frost that he needs to see a deal is within sight by 15 October or the UK will walk away from negotiations.
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One of the largest barriers to a deal has been Brussels’ demand for a level playing field of regulations between the UK and EU to ensure there is no unfair competitive advantage to businesses on either side of the channel.
A part of the level playing field negotiations are EU demands that the UK matches its regulations on how much state support can be given to domestic businesses.
Frost told a parliamentary committee today that the UK last week submitted some details to the EU about what its future state aid regime could look like.
“After a long period in which we’ve been making little progress on subsidy policy, we are having somewhat more constructive discussions on that subject, although unfortunately the gap between us is still pretty wide and a lot of work has to be done,” he said.
“We are only just beginning a discussion about [if] is it possible to go further than you normally do in a free trade agreement and agree to some provisions that shape and condition subsidy policy on both sides.”