European Union chief negotiator Michel Barnier resumed make-or-break Brexit talks with British counterpart David Frost in London on Saturday with the clock ticking for a deal on future trading arrangements.

It is the first time they have met face-to-face since Barnier went into self-isolation after a member of his team caught COVID-19.

A failure to reach an agreement would see Britain and the EU trading on World Trade Organization (WTO) terms, with tariffs immediately imposed on goods traveling to and from the continent.

Britain has been largely trading on the same terms with the EU since it officially left the bloc in January as part of a transition agreement that expires at the end of the year.

As it stands, it will leave Europe's trade and customs area in five weeks with talks on a follow-on agreement stalled over fishing rights and fair trade rules.

Both parties warned on Friday that success was not guaranteed, with Barnier tweeting that the "same significant divergences persist."

"We are not far from the take it or leave it moment," he later told ambassadors from member states, according to a European source familiar with the closed-door meeting.

Prime Minister Boris Johnson's lead negotiator Frost said that people were "asking me why we are still talking," he tweeted.

"My answer is that it's my job to do my utmost to see if the conditions for a deal exist. It is late but a deal is still possible, and I will continue to talk until it's clear that it isn't."

Ireland border fears

A no-deal scenario is widely expected to cause economic chaos, with customs checks required at borders.

The concern is particularly acute on the border between EU member Ireland and the British province of Northern Ireland, where the sudden imposition of a hard border threatens the delicate peace secured by 1999's Good Friday Agreement.

Johnson spoke with Irish Prime Minister Micheal Martin late Friday and "underlined his commitment to reaching a deal that respects the sovereignty of the U.K."

But he also "reaffirmed the need to prioritize the Good Friday Agreement and avoid a hard border on the island of Ireland," according to a summary of the call released by London.

Johnson earlier told reporters the "likelihood of a deal is very much determined by our friends and partners in the EU," adding there were "substantial and important differences to be bridged."

A key sticking point is the EU's demand for a post-Brexit "level playing field" with punishing trade penalties if either side diverges from agreed standards or state aid regulations, but Britain does not want to be bound by rules made in Brussels.

Britain's fishing waters are also a hot topic with sources on Friday saying that Barnier told envoys that London was asking that European access to them be cut by 80%, while the EU was willing to accept 15% to 18%.

The talks have already pushed on much longer than expected, and time is running out for ratification of any deal by the European Parliament by the end of the year.

Members of the European Parliament have expressed frustration with the delays and may have to ratify a deal between Christmas and the New Year.

In Brussels, one source close to the talks said she would "eat my hat" if there was a deal by Monday, echoing a chorus of complaints that Johnson was playing the clock.