The European Union and the United Kingdom failed to bridge their differences over citizens' rights and financial settlement as the second round of Brexit negotiations concluded on Thursday.
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Chief EU negotiator Michel Barnier said there was “a fundamental divergence” on how to protect the rights of EU citizens living in the U.K. and of Britons in the remaining 27 EU countries after Brexit.
Especially “the rights of future family members," Barnier added.
The EU wants rights currently enjoyed by EU citizens in the U.K. to apply to children and family members, whether they currently live in the U.K. or not, and to continue in perpetuity. But the U.K. said only EU citizens who had lived there for five years could stay for life.
British Brexit Secretary David Davis said the U.K. had published the approach to citizens' rights since the first round of negotiations, which he described as “both a fair and serious offer” and had now published a joint paper setting out areas of agreement and issues for further talks.
Barnier also called for more clarity on the British position on financial settlement. Brussels says London must pay a share of money the EU committed to spend when the U.K. was a member, which was around US$70 billion.
When asked whether the U.K. would accept that it would have to pay to leave the bloc, Davis gave no direct answer but said his country will continue to honor its international commitments.
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“We are a country that recognizes its international responsibilities and rights and that we will seek to exercise both in the future. I don't recognize the phrase 'net flows' but we will seek to exercise both in the future,” he told a news conference.
In addition, neither party has proposed a solution to avoid reimposition of border controls between U.K.-ruled Northern Ireland and Ireland, which will remain in the EU.
Davis said the two sides had discussed ways of “achieving a flexible and imaginative solution to address the unique circumstances around the border.” Barnier called on the U.K. to clarify at the next round of talks in August how it would maintain a common travel area.
Labour's shadow Brexit secretary Keir Starmer said the “lack of progress” on the negotiation was “deeply concerning” and would cause “anxiety for millions of families.” He also questioned whether future talks could get under way as planned.
“The reality is that we have a government that is unprepared, divided and incapable of securing a good deal for Britain. We urgently need a fresh approach,” Starmer said.
U.K. International Trade Minister Liam Fox said a trade deal with the EU should be "one of the easiest in human history" to reach, but said his country could survive if it failed to reach at least a transitional trade deal with the EU before its scheduled departure from the bloc less than two years from now.
Anand Menon, a politics professor at King's College London who directs a research group into Brexit, said a failure to reach a deal with the EU would be highly costly.
"Our findings show a chaotic Brexit would, at least in the short term, spawn a political mess, a legal morass and an economic disaster," Menon said.
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