EU and UK negotiators try again to bridge gaps but whether or not a deal can be done may depend on political leaders as time runs out.
EU and UK negotiators are making a final effort to bridge significant gaps in their positions as time runs out to strike a post-Brexit deal. The template for future trading and other relations for years, perhaps decades to come, is at stake.
Talks are taking place in Brussels while British Prime Minister Boris Johnson and Commission President Ursula von der Leyen were scheduled to speak at 17.00 CET.
Prior to their conversation, the British government offered a concession to the bloc and said it would be willing to drop contentious clauses in its Internal market Bill that would allow it to override parts of the Withdrawal Agreement.
Earlier in the day, Michel Barnier briefed EU ambassadors before speaking to MEPs. But there was no sign of a breakthrough. Ireland's foreign minister described the EU chief negotiator's message as "very downbeat".
"I would say he is very gloomy, and obviously very cautious about the ability to make progress today,” Simon Coveney told Irish broadcaster RTE.
UK Foreign Office Minister James Cleverly also acknowledged the situation had changed little. "Yes, time is tight. Yes, it might go right to the wire and, indeed, it may well be that we don’t get the deal. But I think a deal is possible and we’ll keep working towards it," he said.
The British Prime Minister and the European Commission President gave the go-ahead for talks to resume on Saturday, after a day's pause when both sides of negotiators agreed they could go no further.
Unless an agreement is struck in the next few days then, by default, a no-deal scenario will loom ever larger into frame. This would bring extra costs and disruption to a relationship that is due to undergo abrupt changes in any case when the transition period expires at the end of the year.
Sunday night brought reports quoting EU sources that the two sides were converging towards a deal on one of the major bones of contention, fishing rights. The reports were quickly denied on the British side, and dismissed on Monday morning by Barnier himself.
It's understood that important differences remain on the other key issues too: future competition rules, and a mechanism for policing a deal. The two matters are linked: in return for granting the UK privileged access to its markets, the EU wants to make sure it can take effective action should Britain seek to undercut European business or take action to gain an unfair advantage.
The question of enforcement has taken on added importance since the UK's move to override part of last year's binding divorce deal over arrangements for Northern Ireland.
The British government intends to continue down that path when the legislation in question, the Internal Market Bill, comes back before the House of Commons on Monday. Later this week it is expected to introduce a taxation bill also containing provisions which contravene the withdrawal deal.
It means the EU could find itself in the position of having to take a decision over an agreement on the future relationship, at the very moment the UK is reneging on the international treaty the two sides struck barely a year ago after a long, tortuous process.
However, the UK indicated on Monday that it "would be prepared to remove" the contentious clauses in the Internal Market bill if solutions over the Northern Ireland Protocol are found in the coming days.
It also said that "good progress continues to be made regarding the decision as to which goods ar 'at risk' of entering the EU market."
"In light of those discussions, the government will keep under review the content of the forthcoming taxation bill," it added.
At this stage, politics is as important as the technical detail: both sides need to avoid the impression of caving in. France, which has repeated a threat to veto a "bad deal", has led a group of countries anxious to protect EU fishing rights and the integrity of the single market. The UK government, meanwhile, is adamant that an agreement must respect British sovereignty which it says is the essence of Brexit.
It is a defining moment for Johnson, whose Brexit cheerleading played a huge part in the vote to leave the EU and then carried him on to Downing Street.
The prime minister has stressed the importance of delivering the kind of independence promised by slogans such as "take back control". But he now faces a reality that implies either compromise, or pursuing a no-deal which would mean tariffs and other costly barriers to trade, plunging relations with Europe to a new low in the process.
The EU, meanwhile, needs to determine the extent to which it seeks to defend its own "red lines", or give ground in order to secure an agreement and avoid a scenario that would hit its own economy too.
Even if the UK and EU negotiators do reach an accord, that is not the end of the story. The legal text of a deal would need to go before EU national leaders — due to meet at a European Council summit later this week — and be approved by the UK and European parliaments.
The United Kingdom left the European Union last January but has continued to be subject to and apply most EU rules throughout the transition period. Deal or no deal, major changes will kick in on trade and other matters from January 1.
Watch below: UK chief negotiator David Frost arrives in Brussels as talks were revived on Sunday.
What they say about the prospects for a deal
"We are going to see what happens," said Britain's chief negotiator David Frost as he arrived in Brussels on Sunday, amid an ever gloomier outlook that a breakthrough could be achieved on all outstanding points.
"I think unless we can resolve these quite fundamental divergences...we are going to have to take a position in the next few days," UK Agriculture Minister George Eustice said earlier.
"My gut instinct is that it's 50-50 right now and I don't think one can be overly-optimistic about a resolution emerging," Ireland's Prime Minister Michéal Martin told the broadcaster RTE on Sunday.
"We'll see if there is a way forward," said Michel Barnier on Twitter on Saturday evening, after von der Leyen and Johnson had given the go-ahead for talks to continue.