The proposals would have strengthened Switzerland’s economic ties with Brussels.
In a statement the Swiss government said it had: “Concluded that there remain substantial differences between Switzerland and the EU on key aspects of the agreement.
“The conditions are thus not met for the signing of the agreement.
“This brings the negotiations on the draft of the InstA [proposed treaty] to a close.”
It followed a Swiss cabinet meeting to discuss what had become a highly contentious issue.
Whilst Switzerland is not an EU member state it is closely tied to the bloc via bilateral agreements.
Over 100 of these govern its economic relations with EU member states.
However the failure to reach a new deal means will prevent any extended access to the European single market, such as the proposed electricity union.
Bilateral agreements already signed by Switzerland and the EU will remain in place.
However earlier this week EU sources warned rejecting InstA would prevent these being updated, or the signing of any new deals.
More to follow…