This appears to have been borne out by a leaked letter from European Union director-general for education and culture, Martine Reicherts, which says the country is barred as a result of last year's Brexit vote.
In 2008, Liverpool reported a £750m economic impact for its year as host Capital of Culture and a 34 per cent increase in tourism.
"As one of the many concrete consequences of its decision to leave the European Union by 29 March 2019, the United Kingdom can not host the European Capital of Culture in 2023", said the statement.
Dundee's chances of winning the title were effectively wiped out with the stroke of a pen, just days before a delegation was due to head to London to pitch their bid to be named the UK's entry.
A further letter, addressed to European Commission culture commissioner Tibor Navracsics, pleads with the authority to reconsider its position regarding on the Capital of Culture bid.
Culture is the latest casualty of the Brexit vote after five British cities bidding to host the European Capital (EU) of Culture in 2023 were told that they can no longer compete for the title.
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Only cities in countries within the EU, the European Free Trade Association (EFTA), or those that have applied to join the EU are eligible to be considered.
A Downing Street spokesman said: "We disagree with the European Commission decision and we are particularly disappointed that we have been informed of this decision after the bids".
She added: "In Leeds we believe in a future where our culture in all its forms is valued and experienced by the broadest set of people, and for it to be central to the city's identity and to its future - both economically and socially".
"As the prime minister said, we are leaving the European Union; we are not leaving Europe".
"It is now deeply concerning that the amount of time, effort and expense Dundee have put into scoping out their bid could be wasted thanks to the Brexit policy of the United Kingdom government", Scotland's culture secretary Fiona Hyslop said.
The DCMS wants to continue working with colleagues in Europe, which could include participating in cultural programmes. We are seeking urgent meetings with the United Kingdom and Scottish Governments to discuss how the enthusiasm and imagination of Dundee's bid can be taken forward.
Labour's Tom Watson, the shadow culture secretary, some cities had already spent up to $665,000 on their bid submissions.