The EU gave the British negotiating team a torrid time at the first presentation of the UK's white paper on the future relationship during this week's talks, the Guardian has learned.
Led by Michel Barnier's deputy, Sabine Weyand, the EU's team of officials picked apart the most contentious parts of the paper as it was presented by Olly Robbins, Theresa May's chief Brexit adviser, leading to increased concerns on both sides that a no-deal scenario is moving from possible to likely.
"The white paper is not going to form the basis of the negotiations," one senior EU diplomat told the Guardian. British government sources, in the wake of the latest talks, admitted growing despair over what they regard as the intransigence of their EU counterparts.
The heightening of tensions behind the scenes comes with the new Brexit secretary, Dominic Raab, due in Brussels on Thursday.
He is understood to be preparing to make public detailed plans on how the UK would deal with a lack of agreement by 29 March 2019 and a cliff-edge Brexit.
Raab, a former Foreign Office lawyer, met the UK's ambassador to the EU, Tim Barrow, in Whitehall on Wednesday, and is taking a hands-on approach to "no deal" preparations, with insiders saying he appeared to be more focused on the detail than his predecessor, David Davis.
Raab has asked officials to provide short summaries on the main issues, and his closest aides have impressed on the Department for Exiting the European Union that he has high standards.
The European commission's secretary general, Martin Selmayr, has also been working on a document to be circulated among member states spelling out the "very real" consequences for their citizens of a no-deal scenario.
The Guardian understands that Raab and Barnier spoke on the phone for the first time last Thursday, and after talks in Brussels they will have a dinner, following an invitation from Raab.
EU diplomats and officials have looked askance at events unfolding in Westminster in recent weeks, and sources said the first EU-UK discussion of the white paper on Monday in Brussels was difficult, with the Brussels representatives voicing the oft-deployed accusation of "cherrypicking".
In turn, the UK negotiating team believe the commission's negotiators are hiding behind the EU's guidelines, which were published in March last year, stipulating that "the four freedoms of the single market [free movement of goods, capital, services, and labour] are indivisible and that there can be no 'cherrypicking'", meaning that Britain would have to accept the free movement of people.
With the British government in turmoil, the EU has yet to publicly react in any substantive way to the UK's call in its white paper published last week, that it will seek to effectively stay in the single market for goods, and establish a bespoke customs arrangement to avoid border checks on trade.
Senior sources in Brussels said, however, that the reluctance to speak out was due to the clear indication from the UK negotiating team that a full-blooded rejection of the paper would likely prove an existential threat to Theresa May's premiership, and hasten the collapse of the talks.
Barnier is expected to pull his punches again on Friday when he addresses reporters at the end of a meeting of ministers from the 27 member states, where the white paper is to be discussed.
Barnier is instead expected to push for progress on the withdrawal agreement's so-called backstop solution for avoiding a hard border on the island of Ireland after Brexit. That would snap into place should there not be a deal or bespoke technological option to solve the problem at the end of the transition period in 2020.
Along with alignment on regulatory standards on goods, Downing Street has proposed a temporary UK-wide customs arrangement with the EU to avoid border checks.
The commission will propose to the UK team on Thursday that the Brexit talks continue through the usual holiday month of August.
Both UK and Brussels sources suggested that an informal summit in Salzburg in September was now likely to be a crunch moment when EU leaders have a chance to take the lead and instruct Barnier to take a more flexible approach, or send the UK back to the drawing board.
Either way, agreement on the withdrawal deal, and the basis of a trade deal through a political declaration, by the European council summit at the end of October, is regarded as highly unlikely. It is understood that an emergency summit is being pencilled in for early November.