Talks on a post-Brexit trade deal will continue into the weekend, with both side warning that the chances of agreement remain in the balance.
Both Downing Street and the European Commission said the negotiations were still “ongoing”, but that significant differences remained over fisheries and the so-called level playing field rules.
The European Parliament has been pressing for an agreement by 20 December so it can ratify any deal before the current Brexit transition period ends on 31 December.
However, it is thought EU leaders could provisionally sign off on a deal if the talks go on beyond that point, with formal ratification taking place in the new year.
Meanwhile in the UK, MPs are on standby to return to Westminster from their Christmas break if an agreement can be struck in the final days of the year.
On 18 December, both Boris Johnson and the EU’s chief negotiator Michel Barnier were playing down the prospects of a breakthrough.
The prime minister said the negotiations were proving “difficult” and called on the EU to “see sense” and to bring something new to the table.
Earlier Barnier told the European Parliament that the talks were approaching the “moment of truth” and that the path to an agreement was “very narrow”.
If the there is no deal by 31 December, the UK will leave the single market and customs union and begin trading with the EU on World Trade Organisation terms – with the imposition of tariffs.
Even with an agreement, there will be major changes at the border from 1 January with new customs checks, with fears of long delays if businesses are not properly prepared for the new rules.
With less than two weeks to the changeover, the Commons Brexit Committee raised a series of concerns about the UK’s “overall state of readiness”.
In a report published on 19 December, they said decisions had been made “too late”, while communications with businesses had been “patchy at best”.
Committee chair Hilary Benn said the government still could not provide business, traders and citizens with “certainty” about what would happen.
“With just seven working days until the end of the transition period, significant concerns remain,” he said.
“At this late stage, the government must be ready to implement contingency plans where necessary to mitigate the effects of any disruption.
“Failure to do so would mean the worst possible start to the new year for many people and businesses who are already experiencing the toughest of times.”
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