The UK should consider the trade-offs it is willing to make in a post-Brexit deal, European Commission president Ursula von der Leyen says.
She said the closer the UK’s access to the single market – which it is leaving – the more it must adhere to EU rules.
Both sides agreed that differences remained after last week’s trade talks.
The UK wants a “Canada-style” free trade agreement, while Brussels has called for a closer relationship.
The second round of discussions is due to start on 18 March, but the UK has warned it will walk away from trade talks in June unless there is a “broad outline” of a deal.
Boris Johnson has said if the UK does not get a deal similar to the EU-Canada trade agreement, then trade would have to be based on World Trade Organization rules.
Speaking to reporters in Brussels, Ms von der Leyen acknowledged there were differences between the two sides following the first round of negotiations.
“We are aware that there are differences in the approach towards what scope should the future agreement have and what are – if I may say so – the rules of the game everybody has to abide to,” she said.
“So it will be important that the UK makes up its mind – the closer they want to have access to the single market, the more they have to play by the rules that are the rules of the single market.
“If this is not the UK’s choice then of course they will be more distant and it will be more difficult for the UK to access the single market.”
She said it was “up to the UK within the negotiations to think about the trade-offs they want to take into account”.
Following last week’s talks in Brussels, the prime minister’s Europe adviser David Frost said the two sides “now understand each other well”.
EU chief negotiator Michel Barnier said the talks had been “constructive” but there were “very serious divergences” between the sides.
A UK government spokesman said its team had “made clear” the UK would “regain our legal and economic independence – and that the future relationship must reflect that fact”.