Brexit talks are due to continue on Friday amid warnings the prospect of a breakthrough is “receding”.
Negotiations between the UK and EU seemed to stall on Thursday – with Britain claiming Brussels was calling for fresh concessions at the 11th hour.
And with the Brexit transition period due to end on December 31, there is little time to get a deal agreed by negotiators and approved by the EU’s leaders, Westminster and the European Parliament.
A senior UK Government source said: “At the 11th hour, the EU is bringing new elements into the negotiation.
“A breakthrough is still possible in the next few days but that prospect is receding.”
Fishing and the so-called “level playing field” aimed at preventing unfair competition on state subsidies and standards remain the main issues to be resolved in the talks.
Earlier on Thursday, Ireland’s foreign minister Simon Coveney said there was a “good chance” of a trade deal.
It is reported the EU’s chief negotiator, Michel Barnier, is expected to return to Brussels on Friday, but could come straight back to London.
Meanwhile, Prime Minister Boris Johnson will press ahead with plans allowing ministers to tear up the Brexit divorce deal he has already agreed, despite the current round of UK-EU talks being at a critical stage.
The Government will ask MPs to reinstate controversial legislation giving ministers the power to break international law by ignoring provisions in the Withdrawal Agreement relating to Northern Ireland.
MPs will vote on the UK Internal Market Bill on Monday, potentially throwing the talks on a UK-European Union trade deal into deep crisis unless an agreement can be reached by then.
The EU has already taken the first steps towards legal action over the legislation.
The Government will also introduce the Taxation (Post-Transition Period) Bill, which reportedly includes measures to override parts of the divorce deal struck by the Prime Minister and the EU in 2019.
MPs will be asked to reinsert the controversial Northern Ireland provisions into the UK Internal Market Bill after the Lords voted to remove them.
Meanwhile, Labour is split over how to respond to a deal if it reaches the Commons, with senior figures at odds over whether to support it or abstain.
Sir Keir Starmer has confirmed there are differing opinions within the party on its approach to voting on a Brexit deal, but stressed that a trade agreement with the European Union was “in the national interest”.
And Labour former prime minister Tony Blair told the BBC’s Newscast podcast that “Brexit as a political argument is over” and that “there’s no point in raising (the) spectre” of a bid to rejoin the EU.
Mr Blair said: “Brexit as a political argument is over, but you can’t pretend it’s not a big event that’s about to happen in practical terms and therefore short-term it’s going to be very challenging for the country, especially in combination with Covid.”
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