South Korea and the European Union (EU) failed to narrow differences on some sticky issues, including car trade and related rules, in their fourth round of free trade negotiations this week, chief negotiators from both sides said Friday.

"There was some progress in most sectors, but the two sides did not make headway on tariffs, especially in negotiations over auto trade and related regulations," Kim Han-soo, Seoul's chief negotiator for the talks, told reporters on the last day of the five-day talks that started on Monday.

Ignacio Garcia Bercero, Brussels' chief negotiator, criticized the positions Seoul took in this week's negotiations. "I am particularly disappointed that Korea appears to have taken a very defensive approach to tariff negotiations on the industrial sector," Bercero said.

"As a major export-oriented economy, we would certainly expect Korea to take a bolder approach to these negotiations," he said.

The 27-nation economic bloc is demanding that South Korea cut tariffs on cars and other products to the same extent that it did for the U.S. this year in a free trade agreement.

Previous rounds of the negotiations also hit snags over auto trade as both sides remained reluctant to sweeten tariff offers to each other.

Fresh from reaching a trade accord with the United States in April this year, Seoul held three rounds of negotiations with Brussels on a free trade agreement that could provide Asia's third-largest economy with a commercial bridge to Europe.

The fifth round is scheduled to be held in Brussels beginning Nov. 19.

Since the first round started in May this year, the EU has offered to eliminate or phase out all its import tariffs on South Korean goods within seven years, and remove tariffs on 80 percent of goods within three years after a deal comes into force.

Seoul says it would remove all tariffs on industrial goods within three years with some exceptions, and eliminate tariffs on roughly 68 percent of EU goods as measured in value in three years, compared with 63 percent in a previous offer. But the EU expressed disappointment with South Korea's offer, saying it falls short of the accord South Korea signed with the United States in June. "We have been concerned that the offer presented by Korea does not have the serious level of ambition and it is also less serious than the one that Korea has agreed with the U.S.," Bercero said.

In particular, Brussels wants Seoul to cut regulations for European carmakers by applying international standards instead of different domestic rules.

The EU has made a new proposal on tariffs for autos that Seoul is now reviewing. "Our judgement of of the new proposal is negative," Kim said.

South Korea held out for an improvement in Europe's offer to eliminate a 10 percent tariff on imported autos within seven years.

South Korea sold 74,000 autos worth US$9.1 billion in Europe last year while buying only 15,000 vehicles worth $1.6 billion.

The country's tariff rate on cars is 8 percent, compared to 10 percent for the EU.

Bercero said the fundamental issues are technical standards and regulations on autos, pointing out that despite the fact that South Korea is a globally competitive manufacturer, its domestic standards for cars are far different from the international standards that were created by an organization to which both the EU and South Korea belong.

"There is no way that we can conclude the free trade agreement without substantive outcome in the technical barrier to trade in the auto sector," he said.

Bercero said the fifth round would be key in predicting the possibility of reaching a deal.

"This round (in November) is going to be key in order to see whether or not there can be much progress for the conclusion of these negotiations," Bercero said. "This will only be possible if a breakthrough is made on tariffs and non-tariff measures and services, all key elements of the negotiations." "I certainly think it was a useful round, and we have to prepare the stage to make substantive progress in November. I don't want to exclude the possibility of a rapid conclusion," Bercero said, adding that this week's results would not change the EU's commitment to the talks.

In a related comment, South Korea's chief negotiator hinted at revising its tariff offer to the EU in a bid to push the trade talks forward.

"I can't talk about that (revising South Korea's offer). But the negotiations will last longer and be very tough unless we revise our offer," Kim said, adding that the EU side should make a new proposal on tariffs and other issues.

The EU is South Korea's second-largest trading partner after China, with bilateral trade reaching $79 billion in 2006. Some unofficial studies suggest a free trade agreement would boost that figure by as much as 40 percent in the long run.

If implemented, the free trade pact would be the largest for South Korea, surpassing the agreement signed in June with the U.S.

that is still under legislative review.

The EU is also the largest foreign investor in South Korea, with $40.4 billion invested as of the end of 2006. Currently, South Korea has free trade agreements with Chile, Singapore and the European Free Trade Association as well as a partial pact with the Association of Southeast Asian Nations.

Seoul is also seeking similar trade deals with Canada, India and Mexico.

SEOUL, Oct. 19 (Yonhap)