There are still "wide divergences" on "core issues" of the Brexit trade negotiations, David Frost said on Wednesday night after two weeks of intensive talks with the EU.
"We continue to work to find solutions that fully respect UK sovereignty," the UK's chief negotiator said.
A no trade deal Brexit was still a serious risk, EU diplomats warned, before accusing British negotiators of failing to “engage sufficiently” on the three most divisive issues.
Running down the clock would not force concessions from Brussels, they said, after it became clear there was no breakthrough on fishing, the level playing field guarantees and the deal’s enforcement.
Michel Barnier told EU ambassadors in Brussels that some progress had been made, but the two sides were still divided over the long-standing sticking points.
“Despite EU efforts to find solutions, very serious divergences remain,” the EU's chief negotiator tweeted after briefing the 27 senior diplomats and, separately, the European Parliament.
“The EU is prepared for all scenarios,” Mr Barnier added, in a reference to no deal, which would mean both sides trading on less lucrative WTO terms with tariffs and quotas.
"Progress made but I agree with Michel Barnier that wide divergences remain on some core issues," Lord Frost tweeted.
“Brexit talks seem to have made some progress lately. Unfortunately the UK does not seem to be engaging sufficiently on key issues,” one EU diplomat said, "Given this situation a no deal outcome still can’t be excluded.”
Below is a statement by Michel Barnier on 21 October
UK and EU negotiators hope to agree a zero-tariff and zero quota trade deal by mid-November so that the agreement can be ratified before the end of the transition period on January 1.
Both sides have spent almost two weeks locked in intensified negotiations. Those talks are now expected to resume in London on Sunday.
The failure to bridge long-standing divides led some EU diplomats to accuse the UK of trying to run down the clock on negotiations to extract last-minute concessions.
“Putting time pressure on the EU is unlikely to work. There is not much time left for brinkmanship,” a senior diplomatic source said.
The EU continues to push back against British demands for annual negotiations over fishing opportunities.
Britain is resisting agreeing to a system that would enable EU and UK standards to develop over time which made agreement difficult, two sources said.
The UK has offered non-regression clauses on current standards for tax, labour rights and the environment, but no commitments over their future development.
On the governance of the deal, British negotiators have refused to agree to a dispute resolution mechanism that cuts across sectors.
Such a system would allow Brussels to suspend parts of the trade deal in case of disagreement in another part of the agreement.
However, both sides are understood to have moved closer to an agreement on fishing and subsidy law than at any other point in the trade negotiations so far.
“There are positives and negatives,” another senior EU diplomat said, “but the tone of the briefing was that the UK wants an agreement and the EU wants an agreement.”
Mr Barnier asked MEPs for flexibility in the European Parliament timetable to ratify the deal to buy as much time as possible to do the deal.
He told them the UK had accepted EU demands the UK commit to the European Convention of Human Rights, and its court, as a condition for future judicial and police cooperation.
He said that British tactics were a "cause of frustration", and that the UK's walkout from negotiations after Boris Johnson's October 15 deadline for a deal was missed had cost valuable time.