Britain's transition period out of the European Union should last until the end of 2020, the EU's chief Brexit negotiator Michel Barnier has said.
The European Commission has approved guidelines covering Brussels' position on the transition, which have been drawn up by Mr Barnier.
These would see Britain observe the bloc's rules and regulations following the Brexit date in March 2019 while having no influence over them.
During a news conference in Brussels, Mr Barnier repeated the commission's stance that this must include accepting the jurisdiction of the European Court of Justice and allowing the free movement of people.
Mr Barnier said "time is going to be of the essence" if both sides were to agree on the transition and the shape of the future relationship between Britain and the EU before Brexit takes full effect.
British Prime Minister Theresa May has said the "implementation period" should last for around two years, potentially taking it up to the spring of 2021.
But the EU has agreed that the best date for it to end is on December 31st 2020, which is when the EU's multi-year budget ends.
This means a transition period of around 21 months.
Mr Barnier indicated he is hoping to reach an agreement on the future relationship between the UK and EU by next October to coincide with a new treaty containing the terms of agreement on Britain's withdrawal and the transition.
'Finalised by October 2018'
The comments make clear that he sees the document falling short of a full trade deal, which is something Mrs May is pushing the EU to agree quickly.
Guidelines covering the future relationship will be presented to the leaders of the 27 EU states at a European Council summit in March, Mr Barnier said.
He added: "We will be working on a new very important document that needs to be finalised by October 2018, parallel to the Article 50 treaty - a political document which will accompany the withdrawal agreement and which should clearly stipulate and outline the shape of our future relationship."
On the broader question of what kind of trade deal will be possible, Mr Barnier restated his view that Mrs May's Brexit plan - which includes leaving the bloc's single market and customs union - means Brussels can only offer an agreement similar to ones negotiated with Canada, South Korea and Japan.
The UK's Brexit Secretary David Davis is on record as saying he wants Britain's free trade deal to be "Canada plus plus" and include financial services.
Downing Street has said on Tuesday Mrs May will demand a "significantly more ambitious" deal than what the EU has in place with Canada.