European leaders were set to focus on the coronavirus pandemic at Thursday's virtual summit - but it has been overshadowed by the bloc's budget deadlock.
Hungary and Poland plunged the EU into crisis this week when they vetoed its €1.8 trillion budget and coronavirus rescue fund package.
Budapest and Warsaw are against a change that will see EU cash tied to an EU country's respect for rule of law.
Rule of law comprises areas like democratic norms, media freedom and the independence of the judiciary.
Critics argue that Hungary and Poland are undermining the EU's core values. Budapest and Warsaw say they are being targeted by a European oligarchy.
Speaking exclusively to Euronews, MEP Manfred Weber, the leader of the biggest political grouping in the European Parliament, said the continent is facing a big crisis.
"The question is, how can we overcome the veto from Hungary and Poland, and probably as well others? That is the challenge on the table... I am aware that we are facing a lot of problems, but these are fundamental principles, no doubt about this. But again, the question is how can we overcome this?"
Weber insisted the European Parliament would not back down over linking respect for rule of law and EU cash.
"Angela Merkel is very experienced and also trusted by a lot of [EU] council members, so she has a good chance to find a compromise," said Weber.
"And also keep in mind that an overwhelming majority of MEPs and, additionally, an overwhelming majority of Council members support the rule of law mechanism," he said.
"We will not give up on this. That must be clear for the council's negotiations," he added.
Thursday's video conference is a follow-up to the one held on October 29, where leaders highlighted the need to strengthen the collective effort to fight the pandemic, with an aim to focus on test and trace policies, as well as on vaccines.
With multiple vaccines now on the horizon, European leader will discuss on Thursday their distribution and the criteria of who will receive any immunisation first.