"We will continue to engage constructively with the European Union on these key issues and will work hard to reach the broad outline of an agreement, but as we have been clear all along we are not asking for a special, bespoke or unique deal".
The Telegraph has learnt that the Government's central performing assumption is that Britain will trade with Europe on Entire world Trade Organisation (WTO) phrases when the changeover interval ends on December 31.
"If we do not reach an agreement on our future partnership there will be more friction", he added.
But both sides agreed on one thing: there had been no movement on the main stumbling blocks to a deal on fair competition guarantees - or the so-called level playing field - or on fisheries.
United Kingdom chief negotiator David Frost said there were "considerable gaps" in the most hard areas, but a deal could still be reached in September.
"Number three: an agreement on fisheries that shows that Brexit makes a real difference compared to the existing situation".
Mr Barnier also noted some progress this week on how to settle any future disputes over a new EU-UK agreement, an element he has regularly mentioned previously as a key stumbling block together with level playing field clauses and the issue of fisheries.
'We have tried to understand how these three red lines can be squared with our commitment to a comprehensive new partnership as set out in the Political Deceleration signed by Prime Minister Johnson on 17 of October a year ago'.
'Although we will continue energetically to seek an agreement with the European Union, we must face the possibility that one will not be reached, and we must therefore continue preparing for all possible scenarios for the end of the transition period at the end of this year.
"Considerable gaps remain in the most hard areas".
"We have always been clear that our principles in these areas are not simple negotiating positions but expressions of the reality that we will be a fully independent country at the end of the transition period".