The latest round of negotiations takes place over three days in the British capital, with stalemate in key areas stoking fears of a no-deal scenario.

Britain formally left the EU in January, following 47 years in the European project but agreed to a standstill transition until December 31 pending new trade terms.

After the coronavirus pandemic combined with the two sides' entrenched positions to stall progress, London and Brussels last month launched five weeks of intensified negotiations. 

Prime Minister Boris Johnson in June vowed to add "a bit of oomph" into the gridlocked process, and predicted talks could conclude as early as this month.

But several face-to-face sessions since then have yielded few signs of compromise, and the two sides remain far apart on various issues, with only two further rounds of talks left.

Britain steadfastly refuses to extend the transition period and insists it will not let the negotiations "drag on" towards the end of the year.

"Significant differences still remain on a number of important issues," Johnson's official spokesman said on Monday, citing in particular EU access to UK fishing waters.

The UK would "continue to engage constructively" with the EU, he added, but warned time was running out.

"We've said we don't want the talks to drag on into the autumn, that we want to make progress as quickly as possible in order to give certainty and clarity to business and there's no change to that," he told reporters.

'Chasm'

Brussels appears less pressed for time and believes the necessary ratification by the European Parliament and others would require a deal by late October.

Weekend reports in British newspapers said Johnson is "reconciled" to the talks ending after the final scheduled round in mid-August, because of the "chasm" between the sides.

Britain's chief negotiator David Frost and his EU counterpart Michel Barnier kicked off this week's talks with a joint dinner on Monday evening.

Their teams are set to discuss a host of issues, from fisheries and so-called level playing field rules on fair competition to law enforcement and judicial cooperation. 

Without a new agreement, the two sides would see ties reduced to minimum standards set by the World Trade Organization with high tariffs and serious disruptions to business.

London last week unveiled its first detailed proposals for managing Britain's post-Brexit borders, insisting they would be implemented regardless of whether a deal was struck.

The blueprint confirmed the adoption of a staged approach to border enforcement over the first six months of 2021, with initial "light-touch" checks on goods from the bloc.

But a leaked letter from International Trade Secretary Liz Truss to ministerial colleagues said the proposals risk smuggling, damaging Britain's reputation and could face a legal challenge from the WTO.

Business in Northern Ireland, whose frontier with southern neighbors Ireland will be Britain's only land border with the EU, have also demanded more clarity about arrangements.

The raft of proposed border measures set out in the 206-page document laid bare the added paperwork -- and costs -- many firms will face in trading with entities in the EU.

One key plank of anti-EU "leave" supporters' campaign was against Brussels bureaucracy.

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