Brexit SELL-OUT: Boris considers major concession in last-ditch bid for EU trade deal

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David Frost suggested there were signs the Prime Minister is backing down over the UK’s subsidy policy in a bid to reach an agreement with the Brussels club. Also referred to as a ‘level playing field’, subsidy control remains one of the main reasons the UK and EU still have not been able to agree on a trade deal this year.

The UK has previously insisted its subsidy policy would not form any part of its future deal with the Union.

The EU wants to be able to hit trade if Britain violated any future state aid agreement.

But Britain has disagreed, saying it wants control of its subsidy regime and that such clauses are not usually put in free trade agreements.

However, yesterday Mr Frost signalled the UK is softening on this by entering discussions with the bloc.

Speaking to the House of Lords’ EU committee yesterday, he said: ”We have heard what the EU has been saying about needing a degree of reassurance.

“We are beginning a discussion on ‘is it possible to go further than you normally do in a free trade agreement?’ and agree some provisions that, as it were, shape and condition the subsidy policy on both sides.

“I feel we’re some way from a deal at the moment, if I’m honest, but we are at least having a decent discussion of this, you know, what is possible and what isn’t possible.”

He said any subsidies that are granted “must contribute to public policy or market failure. They must be justified on those grounds, they must be proportionate, there must be openness and transparency about what they are”.

Despite ruling out an “extensive text setting out the detail of how we design our system”, Mr Frost said the UK could sign up to principles on subsidy control that mirror those set in the EU’s treaty, which could incorporate “clear statements” that state subsidies to business “must contribute to public policy or address market failure, they must be justified on those grounds”.

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He added: “I can quite see us being ready to use them just as much as the EU in future.

“Other EU countries subsidise quite often more than we do and that could definitely have impact on us.

“They must be proportionate, aimed at bringing about a degree of change in behaviour, they must be the right instruments for the purpose. And you should not in general subsidise if there are negative effects on trade and investment.

“Those are all commitments we are willing to make, and are important parts of a good subsidy system looking at the traditions we have in this country.”

His remarks come after the Brexit negotiator said his team is working very hard to get a trade deal with the EU by October 15, but that date is a deadline which both sides need to take into account.

“My job is just to work as hard as we can over the next two weeks to see if we can get an agreement in place by the 15th.


“Both sides in the negotiations need to take that date fully into account when they’re planning the next two weeks.”

When asked if that date represented a hard deadline, he said that an earlier statement by Mr Johnson referred to that date, adding: “As we approach the 15th – and it is very close already – I will have to advise the Prime Minister on whether the conditions in his statement have been met or not.

“Even if there was no basis for a Free Trade Agreement, there was a good deal that will be worth talking about before the end of the year, there were a lot of practical matters that we would need to cover, so in any circumstances I would expect that to be happening.”

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