The deputy minister of state revenue, finance and planning, Ranjith Siyambalapitiya, said Colombo wanted an extension of the EU generalised system of preferences (GSP Plus), but would not agree to pre-conditions.
The EU had given a list of questions on rights issues and had wanted to send a mission to the island to investigate allegations of abuses following the end of nearly four decades of ethnic conflict with Tamil rebels.
"We didn't allow them (EU investigators) to come," the minister told reporters here.
"We do not have human rights issues."
Sri Lanka has been exporting to EU-member states under GSP Plus for over four years and import taxes will kick in unless tariff concessions are extended at the end of this year.
The EU has insisted that an extension would depend on Colombo cleaning up its rights record and its handling of some 300,000 ethnic Tamils who were displaced by the fighting and are now housed in interment camps.
An official close to the negotiations said