Michel Barnier has insisted that both sides in the post-Brexit trade negotiations must be willing to compromise as efforts continued to restart the stalled process.
The European Union’s chief negotiator insisted an agreement was “within reach” despite being rebuffed in efforts to continue formal discussions this week.
Mr Barnier and his counterpart Lord Frost, Boris Johnson’s Europe adviser, have remained in touch but the negotiations have been in limbo since last week’s European Council summit failed to produce a breakthrough.
The UK Government has insisted that there must be a fundamental change of approach from Brussels, with Mr Barnier demonstrating that the EU will compromise in key areas.
Downing Street said Mr Barnier’s comments were “significant” and Lord Frost would speak to him later on Wednesday.
The main stumbling blocks remain fishing rights, the governance of any deal and the “level playing field” aimed at preventing unfair competition, which includes state subsidies.
Time is short to reach an agreement before the end of the transition period on December 31.
Mr Barnier told the European Parliament: “Our door remains open. It will remain open right up until the last day when we can work together.”
But he said “it takes two to make a deal”, adding: “We are not sure that’s the outcome we will obtain and that’s why we need to be ready to deal with the consequences of a possible no-deal scenario.”
Extending an olive branch to the UK, Mr Barnier indicated the EU was willing to make compromises – but only if Mr Johnson also agreed to give ground.
“We will seek the necessary compromises on both sides in order to do our utmost to reach an agreement and we will do so right up until the last day which it’s possible to do so,” he said.
“Our doors will always remain open right up until the very end.”
The EU’s chief negotiator insisted: “Despite the difficulties we’ve faced, an agreement is within reach if both sides are willing to work constructively, if they are willing to compromise.”
But he warned: “Time is running out each and every day”.
Mr Barnier said the level playing field remained a “fundamental concern”. But he added: “The UK are willing to look at this demand, and they’re willing to move forward and shift in their way of looking at this.
“They’re willing to do things in a different way to what exists in current trade deals among other countries.”
On fisheries, Mr Barnier said: “There will not be a trade deal without a fair solution for fishermen on both sides.
“There needs to be mutual access to waters and there needs to be a fair distribution of quotas for fishermen on both sides.”
A Number 10 spokesman said: “We note with interest that the EU’s negotiator, speaking to the European Parliament this morning, has commented in a significant way on the issues behind the current difficulties in our talks.
“We are studying carefully what was said.
“David Frost will discuss the situation when he speaks to Michel Barnier later today.”
European Council president Charles Michel told MEPs: “We want a deal but not at any cost.”
He added: “You can’t have your cake and eat it too”.
In London, Mr Johnson’s efforts to win over business leaders to his approach ran into difficulties after a “pointless” call with bosses.
The Prime Minister and Cabinet Office minister Michael Gove addressed around 250 business leaders on Tuesday, insisting the UK would prosper either with or without an EU trade deal.
“There is a big opportunity for this country and we want to help all of you to seize that opportunity,” the Prime Minister said.
But one of the business leaders on the conference call told the PA news agency: “The whole thing was over in 23 minutes. There was no opportunity to ask questions and it was completely choreographed.
“Only three people were allowed to ask questions, set up in advance, and we were essentially told ‘it will all be fine’.”
The session was described as “a little bit of a ramble and a lot of posturing”.
“It was a wasted 23 minutes of my life. It was pointless,” the source said.