Britain and Hungary had been due to get the honour in six years' time, and five British cities had even reportedly submitted nominations at the invitation of the government.
But the European Commission, the executive arm of the soon-to-be 27-nation EU, said it had sent a letter to the British culture ministry yesterday saying that it was no longer possible.
"As one of the many concrete consequences of its decision to leave the European Union by 29 March 2019, the UK cannot host the European Capital of Culture in 2023," a European Commission spokeswoman said in a statement, confirming a story in Politico Europe.
Belfast and Derry in Northern Ireland, Dundee in Scotland, and Milton Keynes, Leeds and Nottingham had put themselves forward, the Guardian newspaper said.
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Explaining why non-EU cities including Istanbul in Turkey, Stavanger in Norway and Novi Sad in Serbia have been named European Capital of Culture, the spokeswoman said the scheme is "not open to third countries except candidate countries and European Free Trade Association/European Economic Area countries."
Britain however has said it will not be part of the EEA after it leaves the EU.
The blow comes days after Paris and Amsterdam were named as the host cities of two major London-based EU agencies, in what the commission said was the "first visible result" of the June 2016 Brexit vote.
The EU started the European Capital of Culture scheme in 1985, and currently names two cities a year. The current holders are Aarhus in Denmark and Paphos in Cyprus.
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