LONDON — Britain and the European Union on Wednesday failed to interrupt the impasse in vital negotiations a few post-Brexit commerce deal and, with huge divisions remaining between them, set a brand new deadline for Sunday to achieve a choice on the way forward for the talks.

A gathering over dinner between Prime Minister Boris Johnson of Britain and Ursula von der Leyen, the president of the European Fee, the bloc’s govt physique, ended with out vital progress, with massive gaps left remaining between the 2 sides, and no clear path to bridging them.

Wednesday’s three-hour assembly had been arrange with the purpose of ending months of impasse in commerce negotiations, talks that remained stalled simply three weeks earlier than Britain completes the ultimate stage of Brexit, by leaving the European Union’s financial space on the month’s finish.

However in a statement Ms. von der Leyen stated that regardless of “a full of life and attention-grabbing dialogue” the 2 sides’ positions “stay far aside.”

“We agreed that the groups ought to instantly reconvene to attempt to resolve these important points. We’ll make a decision by the tip of the weekend,” she added.

The announcement of a brand new Sunday deadline nonetheless retains alive hopes for a last push to strike the elusive commerce settlement that many analysts had anticipated to emerge, theatrically, not lengthy earlier than the Dec. 31 deadline. Discussions will now proceed this week on a last deal that would decide the form of Britain’s relations with continental Europe for many years to return.

However the lack of progress at Wednesday’s dinner is one other setback to a negotiation that has been caught for months.

Financial and political logic means that the British prime minister badly wants a deal. However having campaigned for Brexit on the premise of reclaiming nationwide sovereignty, Mr. Johnson faces a troublesome process in reaching any settlement acceptable to each the bloc and Brexit supporters again dwelling.

On Thursday, European Union leaders are set to collect in Brussels with different necessary points on their agenda, like the following seven-year finances, the coronavirus restoration fund, the rule of legislation and doable sanctions on Turkey. European leaders weren’t planning to debate Brexit, although Ms. von der Leyen is anticipated to temporary them on her talks with Mr. Johnson.

Had the Brexit commerce discussions collapsed on Wednesday night time, the political give attention to either side would have shifted to how to deal with the failure to strike a deal, and tips on how to restrict disruption in January when an abrupt change within the phrases of commerce may depart ports blocked and vans stranded.

However the German chancellor, Angela Merkel, remained upbeat on Wednesday, saying “there may be nonetheless the possibility of an settlement.” She careworn, although, that the European Union wouldn’t settle for any deal “if there are situations from the British aspect that we are able to’t settle for” or that threatens the only market.

Given the complexities and acute political sensitivities round any deal, neither aspect forward of the assembly had been elevating expectations {that a} breakthrough can be reached over Wednesday’s dinner of pumpkin soup and — appropriately for negotiators divided over fishing rights — scallops and turbot.

The Irish international minister, Simon Coveney, has expressed his perception that there will likely be some “skinny” deal, a naked minimal settlement, however that the final hurdles are all the time probably the most tough. “I feel the negotiating groups and senior politicians will discover a manner of getting a deal,” he stated, “however in the mean time we’re in a tough place as we attempt to shut it out.”

However even Mr. Coveney, who is an efficient barometer of European sentiment, is changing into extra gloomy. He stated Monday night time, after a gathering of bloc international ministers, that the temper was shifting towards preparations for going ahead and not using a deal. There’s “quite a lot of frustration on the E.U. aspect, not simply inside the E.U. negotiating group” however “additionally throughout member states,” Mr. Coveney stated.

One excellent situation was resolved on Tuesday when London dropped a threat to break its withdrawal treaty — and to breach worldwide legislation — over how it will implement guidelines on the circulation of products between Britain and Northern Eire.

But the primary points which have prevented them from placing a commerce deal have remained tough to resolve: fishing rights, the principles on state subsidies and “degree taking part in area” provisions to make sure truthful competitors between British and European corporations, and the mechanisms to implement them.

Whereas entry to fishing shares is an especially contentious political situation for Britain, France and different coastal European nations, the opposite points are in all probability harder to resolve, as a result of they contact on the hypersensitive rules of sovereignty.

The largest hole is over the phrases of truthful commerce, as a result of officers in Brussels concern that, as a big economic system on Europe’s doorstep, Britain may undertake decrease labor or environmental requirements, flood the European market and undercut continental corporations.

On this level, Mr. Johnson faces a dilemma. Negotiators in Brussels need the proper to impose tariffs on imports ought to Britain diverge from Europe’s requirements. Provided that Britain says it doesn’t, basically, intend to undertake decrease requirements, it would by no means must confront such a scenario. But when Britain fails to strike a commerce deal, it will undoubtedly face tariffs.

Slightly than a dry and technical commerce situation, Mr. Johnson sees this as a European try and tie Britain to the bloc’s future rule ebook, trampling the nationwide sovereignty that was on the coronary heart of his imaginative and prescient for Brexit.

Mr. Johnson instructed lawmakers on Wednesday {that a} whole lot was nonetheless doable. However he added that if Britain didn’t comply with future European guidelines, Brussels needed the “automated proper to punish us and to retaliate,” including that no British prime minister ought to settle for such phrases.

Exhausting-liners inside his personal social gathering have amplified that argument, interesting to him to not compromise within the discussions with Ms. von der Leyen.

“The truth is that that is all about sovereignty,” Iain Duncan Smith, a former chief of the Conservative Get together and a Brexit fanatic, wrote in The Daily Telegraph. “From the start, it has been clear, while the U.Okay. needs a commerce deal, E.U. needs to manage us. Both the U.Okay. is sovereign or it isn’t.”

But the value of exercising full sovereignty may very well be very excessive. Failure to strike a commerce deal may properly be exploited by pro-independence campaigners in Scotland, the place a majority of voters opposed Brexit in a 2016 referendum. It will additionally wipe an extra 2 p.c off British financial output whereas driving up inflation, unemployment and public borrowing, official forecasts stated final month.

Whereas European nations would undergo, too, none — with the doable exception of Eire — can be hit as laborious as Britain. Senior French officers, just like the Europe minister, Clément Beaune, have stated that France is able to veto an unsatisfactory deal, and Dutch officers have urged that the European Union’s chief negotiator, Michel Barnier, is coming very shut in his negotiations to crossing “the crimson strains” of his mandate by way of the allowable concessions to achieve a deal.

Ms. Merkel careworn the necessity for Britain to stick intently to the bloc’s guidelines on labor, the surroundings and truthful competitors, in addition to for mechanisms to police any settlement.

“We will need to have a degree taking part in area not only for in the present day, however we will need to have one for tomorrow or the day after, and to do that we will need to have agreements on how one can react if the opposite adjustments their authorized scenario,” Ms. Merkel stated. “In any other case there will likely be unfair aggressive situations that we can not ask of our corporations.”

The Europeans are adamant that the mandate won’t change and that Mr. Barnier has their confidence. Whereas European nations could have differing priorities, their leaders say that they won’t break the solidarity proven to this point, and that their formal function will likely be merely to endorse any deal Mr. Barnier can attain — or acknowledge that the talks have failed.

Although Thursday’s assembly was seen as a chance for European Union leaders to approve a Brexit commerce deal, some analysts consider that an accord may nonetheless be agreed and ratified within the final days of the month.

How this will get resolved — to what diploma Britain should preserve to guidelines set in Brussels and tips on how to settle any disputes that come up — stays on the coronary heart of the persevering with disagreements. However promoting any deal that emerges is one other matter solely.

Stephen Citadel reported from London, and Steven Erlanger from Brussels.