Downing Street has insisted it is “categorically untrue” that the post-Brexit relationship with the EU envisaged by Theresa May would make a trade deal with the US impossible.
It came as reports suggested that the Prime Minister will concede to ministers on Friday that plans to align the UK with EU regulations on goods and agriculture make a US deal unlikely.
American commerce secretary Wilbur Ross has previously warned that a failure by the UK to break away from EU food safety rules in areas such as GM crops and chlorinated chicken would get in the way of a successful trade agreement.
The document, obtained by The Spectator, also reportedly says that “we would strike a different arrangement for services, where it is our interests to have regulatory flexibility, recognising this will result in reduced market access”.
And the magazine quotes the paper as saying that these arrangements “would not allow the UK to accommodate a likely ask from the US in a future trade deal” as the UK would be unable to recognise the US’s “array of standards”.
The document emerged as Mrs May flew to Berlin for talks with German Chancellor Angela Merkel in which Brexit was high on the agenda.
At a press conference ahead of their talks, Mrs Merkel said that Brexit negotiations were about to enter a “crucial phase”, with political agreement on the future relationship needed by October.
“I think it’s going to be very important to hear what the British Government is going to decide on these matters in the next two days,” she said.
Mrs May told Chancellor Merkel that at Chequers the Cabinet would “discuss and decide a substantial way forward which will allow the pace and intensity of negotiations to increase”.
With less than a day to go before senior ministers meet in Buckinghamshire to thrash out a White Paper for publication next week, Mrs May’s proposals, if confirmed, are likely to infuriate eurosceptic members of her Cabinet such as Foreign Secretary Boris Johnson and Brexit Secretary David Davis.
It is understood that Mr Davis is not ready to support the proposal to align with the EU on regulations of goods, including agri-food, and anyway does not believe it would be accepted by Brussels.
Eurosceptic former Cabinet minister Owen Paterson said that, if true, the plans would represent “a complete breach of Theresa May’s manifesto commitment, reconfirmed to me at PMQs yesterday, to leave (the) single market, customs union and European Court of Justice.”
Mr Paterson said: “We could not eliminate tariffs to reduce prices for consumers and businesses, or strike free trade deals.
“If true, this would deny 100% of British economy the full benefits of Brexit to appease only 12% of UK GDP accounted for by exports to EU and be completely at odds with what 17.4 million voted for.
“We would be out of Europe but still run by Europe.”
One Brexiteer source said backbench eurosceptics did not expect the PM’s plans to even reach MPs because “Boris and David aren’t having it”.
“The president (Donald Trump) himself has always made it clear that he is keen to sit down and talk with the UK about that.
“The president and Prime Minister will have an opportunity to talk about it next week.
“It is categorically untrue to suggest that we will not be able to strike a trade deal with the US.”