A deal is due to be announced on Christmas Eve, a UK government source and a European diplomatic source told CNN. News of a possible deal was also reported by the UK news agency PA Media.
The announcement would come before the deal’s deadline, December 31.
A senior source at 10 Downing Street told CNN that the UK office was informed of the negotiations on an overnight call on Wednesday. After that information, the source told CNN: “We hope that negotiations on the legal text will last until the wee hours.”
European Commission spokesman Eric Mamer suggested that the final details were being worked out. Around midnight, local time, he tweeted: “#brexit the work will continue through the night. Getting some sleep is recommended for all brexit watchers at this point. I hope it starts early tomorrow morning …”
Earlier on Wednesday, a No.10 adviser told CNN that negotiations were “moving forward, but have not yet arrived”. An EU diplomat agreed, telling CNN on Wednesday that a deal could be made “today or tomorrow, but it hasn’t happened yet”.
Any potential deal would subsequently face a ratification process before it goes into effect on January 1, 2021, when the Brexit transition period ends and the UK will no longer be subject to EU rules.
There was a concern that the agreement would not be ratified before the end of the transition period; however, the European institutions, including the European Parliament, have agreed to collect overtime at the end of the year so that the agreement can be approved in time.
Fears of any delays in approving the deal in time for the end of the transition period have been largely dispelled by the fact that it is largely possible to implement trade agreements provisionally before they are ratified, meaning that in the worst case scenario, the most serious damage yet can be avoided.
The news of a possible deal comes amid an increase in coronavirus cases in the UK. Meanwhile, thousands of trucks from across Europe faced a third day stuck in the English port of Dover after France’s now suspended border closure because of a potentially more contagious variant – a preview of the kind of border chaos that could have resulted of a “no deal” Brexit.
But the discovery marks an important milestone in the saga that began with the UK’s vote to leave the EU in 2016.
The Brexit debate will continue
In the UK itself, any agreement is unlikely to end the years of toxic political debate over the country’s relationship with Europe.
Euroskeptic lawmakers are already organizing efforts to ensure that an agreement does not leave room for the UK to return to EU orbit. In the meantime, pro-Europeans will hope that, at some point in the future, the United Kingdom, perhaps under new leadership, will be able to strengthen ties with Brussels.
Without a trade deal, UK companies would lose tariff and quota-free access to the EU market for more than 400 million consumers, who buy almost half of the country’s exports and supply a similar share of their imports. For the EU, the United Kingdom is much less important, accounting for only 4% of the bloc’s exports in 2019 and 6% of imports.
Earlier this month, the prime minister insisted that, regardless of what the deal would look like, the UK would “prosper powerfully as an independent nation”.
Even if any deal is less economically damaging than no deal, the UK will still be poorer in the long run than if it had stayed in the EU, the independent agency that produces economic forecasts for the government said in November.
For the time being, neither side has an appetite for further negotiations after years of painful disagreements.
Hanna Ziady contributed to this report.