The European Union’s chief negotiator Michel Barnier has held talks with Oliver Robbins, Mr Davis’s chief official, in the run up to this month’s first-phase Brexit talks.
With Mr Davis not present at the meetings, EU officials had noted Mr Robbins was taking an increasingly important role since leaving the Department for Exiting the European Union (Dexeu) to lead a new European unit in the Cabinet Office.
In his new role Mr Robbins will report directly to Prime Minister Theresa May rather than Mr Davis.
Government sources have suggested Brussels may have been keen to brief over the story in an attempt to undermine Mr Davis’s authority ahead of the next round of Brexit talks in the spring.
A source told The Times: “The truth is there are a few people in Brussels who fantasise about seeing David Davis being sidelined, but it isn’t how the Prime Minister sees it. It isn’t where Britain’s national interest lies and it isn’t happening.”
The sources pointed to previous reports in the UK press claiming that Mr Barnier’s role had been downgraded, suggesting that yesterday’s briefings could be retaliation.
However Whitehall sources have acknowledged there are tensions between Mr Robbins and the Brexit Secretary.
Before moving, in September, Mr Robbins was both Dexeu’s permanent secretary and Mrs May’s chief EU adviser.
A Labour parliamentary question has revealed that his Cabinet Office unit has 18 staff, rising to 30 over the next few months.
One official said there were tensions between Dexeu, Mr Robbins’s unit and UKRep, which also represents Britain in Brussels.
The source said: ”Dexeu may have been in charge at the beginning but since Oli [Mr Robbins] left it’s been much more confusing.
“There have been cases of one part of Whitehall telling you to do one thing and then another part contradicting them. It has, at times, been a bit of a mess.”
She said: ”David Davis appears to have been left out in the cold throughout the Brexit process.
”First he admits the impact assessments don’t exist, then he’s sidelined during the negotiations, and now civil servants are spending more than a million pounds on a rival Brexit department. What on earth is David Davis actually doing?”
Another source that Mr Robbins’s growing influence showed Mrs May taking a more prominent role in the negotiations, ahead of Mr Davis.
He said: ”Oli reports to the PM and is doing the negotiating with Barnier and others on her behalf.
“She is the one taking the decisions and on several occasions told him that his proposed compromises were not acceptable. That may mean DD [Mr Davis] has had less of a role, but this process is still controlled by the politicians.”
The shadow Brexit minister Jenny Chapman said it was clear that Mr Davis had been sidelined.
The news comes as business leaders called on Britain and Brussels to settle terms for a post-Brexit transition deal by the end of March and make headway in agreeing a free trade deal.
CBI Director General Carolyn Fairbairn wrote to members at the end of a “rollercoaster” year.
She said, citing slower growth, delayed investment and higher inflation: “Firms have responded with resilience but there’s no doubt that the impact of uncertainty has taken its toll.
“Thankfully the year has ended with some good Brexit news.
“We all breathed a sigh of relief when the EU Council in mid-December confirmed that trade talks can now begin and a status quo transition has been agreed in principle.
“Even harder work lies ahead. To keep jobs and investment in the UK, binding Brexit transition terms by the end of the first quarter need to be accompanied by progress on a framework for a final deal that delivers barrier free trade with the EU.
“From our politicians we need unity, clarity and certainty, not a different opinion every day.
“Politics will need to work on business timescales if we are to get the right result for the country.”