Paris, :A deadline set by France for Britain to grant licences to its fishing boats is set to expire on Friday with Paris threatening legal action unless a last-minute compromise can be found.
France says that 104 of its boats still lack licences to operate in British and Channel Island waters which should have been granted under a Brexit deal Britain signed with the European Union in December last year.
The situation has raised tensions, with Britain briefly deploying two navy gunboats in May when dozens of French trawlers massed in front of the island of Jersey in protest, prompting France to send two coastal patrol vessels.
French fishermen held another brief protest last month, blocking ferries and freight traffic through the Channel Tunnel.
Britain denies discriminating against French boats and says many of the applicant vessels are unable to provide the paperwork required to qualify for a licence.
France's Europe Minister Clement Beaune held out the possibility of Britain granting "a few dozen more as a gesture of goodwill" which would means talk could continue.
"If they stick to their guns, then we will ask the European Commission to begin a legal complaint," he told the Franceinfo radio station on Friday morning.
France and Britain have clashed repeatedly this year over fishing, migrants crossing the Channel, post-Brexit trade arrangements, and the sale of submarines to Australia.
Many analysts and diplomats see ties as being at their lowest ebb in at least two decades, and possibly more.
"The problem with the British government is that it does not do what it says," French President Emmanuel Macron told a news conference on Thursday, just weeks after he accused British Prime Minister Boris Johnson of having a "not serious" approach on tackling migration.
- EU sanctions threat -
The British government has said it does not recognise Friday as a deadline to resolve the fishing row.
"We've never set a deadline. I recognise they (the EU) themselves have set one but it's not one we're working to," Prime Minister Boris Johnson's spokesman told reporters on Thursday.
British Environment Secretary George Eustice is expected to hold talks with EU Environment Commissioner Virginijus Sinkevicius on Friday.
If France lodges a complaint with the European Commission, it could lead to the start of a formal infringement procedure against Britain.
The final step, if the two sides are unable to resolve their differences, could see the EU impose financial penalities or even tariffs on British goods if Britain is judged to be reneging on its commitments under the December 2020 Brexit deal.
The EU and Britain are also locked in a separate trade row over checks on products entering the British province of Northern Ireland after the UK government unilaterally postponed the introduction of checks.
Under the Brexit deal, European fishermen can continue to work in British waters as long as they can prove that they used to fish there.
France says small boats without GPS data are being penalised while Britain is also often refusing to issue licences to new boats that replaced older vessels in the French fishing fleet.
Britain denies the French claims.