The 27 leaders without Britain will declare that there is not "sufficient progress" on divorce issues such as the exit bill to formally move onto the next phase, including a post-Brexit trade deal, according to a draft statement obtained by AFP Thursday.
Mr Wolff said Brussels has a "will" to reach an agreement with the United Kingdom, especially in regards to the so-called Brexit bill.
He said: "On this question, we have reached a state of deadlock which is very disturbing for thousands of project promoters in Europe, and it is disturbing also for taxpayers".
The U.K. had insisted Brexit negotiations had reached a point where sufficient progress had been made to take the talks to the second stage where the future relationship arrangements between the U.K. and the European Union could be discussed.
"As we look to the October Council next week, I hope the member states will recognise the progress we've made and take a step forward in the spirit of the prime minister's Florence speech", Mr. Davis said.
However, that commitment has not yet been spelled out by United Kingdom negotiators.
In response to the United Kingdom government's move to set out its plans for a "no deal" option, the European Council President said the EU was hopeful it could move to the second stage of talks - which will allow negotiators to talk trade and transition - before the critical end-of-year deadline.
It comes as Brexit secretary David Davis urged the other 27 member states to loosen the terms of Michel Barnier's mandate, which has been blamed for stifling progress and dragging down the negotiations.
While that is unlikely to happen, Barnier has been pushing member states for making a gesture towards the United Kingdom by pledging to "scope" the positions on transition within the EU-27.
"I am still convinced that, with political will, decisive progress is within reach in the coming two months".
"Over the next few weeks I will explore the way forward, if there is the necessary will, ways of getting out of this deadlock we found ourselves in on the financial issues with the view of making sufficient progress by the next European Council", he said.
On the latter issue differences still remain over the European Court of Justice's role in guaranteeing those rights, family unifications and the exporting of United Kingdom benefits.