The European Council has rejected the Prime Minister’s latest Brexit proposals — for remaining in some agencies and in line with some rules — as well as demanding continued access to the UK’s territorial fishing waters.

In new negotiating guidelines, the council insisted Brexit “will have negative economic consequences”, as the bloc continues to take an uncompromising stance that will punish the British people for voting to take their sovereignty back.

The six-page document insists financial services will not be part of a post-Brexit trade agreement and makes clear the UK will not be able to stay in EU agencies on chemicals, medicines, or financial services, as Theresa May proposed in her speech last week.

My remarks today at a press conference with Prime Minister @Xavier_Bettel on the draft guidelines for the future EU-UK relationship after #Brexit:https://t.co/nAyGMfE8Sm pic.twitter.com/zKfB2j6VKq — Donald Tusk (@eucopresident) March 7, 2018

“The European Council has to take into account the repeatedly stated positions of the UK, which limit the depth of such a future partnership. Being outside the customs union and the single market will inevitably lead to frictions,” the guidelines said.

“Divergence in external tariffs and internal rules as well as absence of common institutions and a shared legal system, necessitates checks and controls to uphold the integrity of the EU single market as well as of the UK market.

“This unfortunately will have negative economic consequences.”

The Council also repeated the bloc’s insistence that outside the Single Market, a Canada-style trade agreement is the best the UK can hope to achieve, slapping down Mrs. May’s calls for a sector-by-sector approach and for the UK to mirror EU rules in some areas.

However, the UK will also have to hand over continued access to its territorial fishing waters. Currently, European ships take the majority of the UK’s fish.

Presenting the guideline, Mr. Tusk said: “I propose that we aim for a trade agreement covering all sectors and with zero tariffs on goods. Like other free trade agreements, it should address services.

“And in fisheries, reciprocal access to fishing waters and resources should be maintained.”

Former UKIP leader and MEP Nigel Farage immediately responded, blasting: “Unless we take back full ownership and control of our waters, Brexit will have been betrayed.

“Our coastal fishing communities have this one last chance. Time for Mrs. May to handbag Barnier and say we will take our waters back. This is the acid test of Brexit.”

Appeaser Theresa to Drop Commitment to ‘Bind’ Britain to EU Rules, But Will Still ‘Mirror’ Them https://t.co/1ht6xEAeVK — Breitbart London (@BreitbartLondon) March 2, 2018

UKIP interim leader Gerard Batten MEP added: “The EU wants to have its cake and to eat it. Their published guidelines today should be unacceptable to the British government and to the 17.4 million people who voted leave.

“It is clearly not in the national interest to accept a free trade deal which does not involve financial services.

“It is incredible beyond belief that the EU has the gall to ask for free access to British fishing waters once we have left the EU. They want our money and our fisheries – this is completely unacceptable.”