The EU’s chief negotiator Michel Barnier says there has not been enough progress to move to the next stage of Brexit talks as the UK wants.
He said there was “new momentum” in the process but there was still “deadlock” over how much the UK pays when it leaves, which he called “disturbing”.
Brexit Secretary David Davis said he still hoped for the go-ahead for trade talks when EU leaders meet next week.
The pair were speaking after the fifth round of Brexit talks in Brussels.
Mr Barnier said: “I am not able in the current circumstances to propose next week to the European Council that we should start discussions on the future relationship.”
The UK’s Brexit Secretary David Davis urged EU leaders at the summit, on 19 and 20 October, to give Mr Barnier a mandate to start trade talks and to “build on the spirit of co-operation we now have”.
He said there had been progress on the area of citizens’ rights that had moved the two sides “even closer to a deal”.
The EU chief negotiator told reporters at the joint press conference he hoped for “decisive progress” by the time of the December summit of the European Council.
He said Theresa May’s announcement that Britain would honour financial commitments entered into as an EU member was “important”.
But he said there had been no negotiations on the issue this week because the UK was not ready to spell out what it would pay.
“On this question we have reached a state of deadlock which is very disturbing for thousands of project promoters in Europe and it’s disturbing also for taxpayers.”