FISHING rights will be a deal-breaker, the UK has warned Brussels, signalling that unless the EU moves on the “fundamental” issue, then the trade talks will collapse.

The warning shot has come from a senior source close to the UK negotiating team following a round of negotiations – conducted virtually due to the coronavirus outbreak - that were "constructive" but made "limited progress in bridging the gaps" as the clock ticks down to the key high-level stock-taking meeting set for June 30.

He explained that so long as Michel Barnier, his EU counterpart, continued to pursue the bloc’s current mandate on fishing rights and maintaining current quotas, then no progress towards a final deal would be made.

"If they continue to insist on their position on a so-called level playing field and on continuing the Common Fisheries Policy, for example, we are never going to accept that. Draw your own conclusion from that but I hope they will move on."

Asked directly if the issue of fishing water rights was, therefore, a potential deal-breaker, the source replied: “We have certain fundamentals on this. At the end of the year we become a country that has control over our coastal waters; we become an independent coastal state.

“We will base access on science and it will be up to us to determine access by annual negotiation. That is a kind of fundamental. If the EU wants to talk to us on what will work on that basis, then fine.

“We are looking for a deal like the one they have got with Norway; the fact they have got one already shows they are willing to agree arrangements like that and they should talk to us about it.”

But the source repeated: “There are some fundamentals we are not going to change and we are not going to move on. They’re not part of a negotiating position because they’re what an independent state does. An independent state has control over its coastal waters,” he declared.

The source made clear that with or without a deal, the UK would determine its fishing waters access for 2021. “There are some provisions in the Political Declaration and the Withdrawal Agreement that provides for that. Yes, that’s the plan. Of course, that is what automatically happens at the end of the year if there is no deal, that is the situation. So, preparing for that is naturally inevitable.”

The UK is blaming Brussels for having made "limited progress" during the first round of negotiations on a future post-Brexit trade deal.

The source said: "We agree with Barnier that there is little time, there is the need to make progress.

"What is clear to me is, if we were agreeing a standard Canada-style free trade agreement, we could do it quite quickly with quite a good understanding between the negotiators on the terms of an FTA.”

He noted at some point before the high-level meeting in June, Boris Johnson would have to get personally involved.

“The Prime Minister needs to get involved when we are dealing with the most sensitive political aspects of this negotiation; we are not quite at that point yet,” he added.

Mr Barnier has made clear a trade deal could not be agreed unless it included a “balanced, sustainable and long-term solution on fisheries".

He said it was unacceptable for the UK Government to "impose this short, brief timeline and at the same time not budge or make progress on some topics that are of importance to the EU".

The EU negotiator declared: "The UK cannot refuse to extend the transition and at the same time slow down discussions on important areas."

He said an extension to the transition period had to be a common decision before the June 30 deadline for the stock-take.

However, Mr Johnson's spokesman has insisted "no one should be in any doubt the transition period is going to end on December 31", and that the "reality" was Britain would then become a sovereign state in control of its fishing waters.