EU summit: talks enter 'crucial phase' as leaders meet for fourth day

Leaders left the marathon summit early Monday morning without an agreement and are set to resume talks at 4 p.m. The summit was originally planned to end on Saturday.

Von der Leyen told reporters that "after three days and three nights of negotiation marathon, we're entering now in the crucial phase but I have the impression that European leaders really want an agreement."

"I'm positive for today, we're not there yet but things are moving in the right direction," she added.

Talks have focussed on a proposed EUR 1.68 trillion package, a seven-year budget and a coronavirus recovery fund.

Eastern Europe leaders have opposed attaching rule of law conditions, with Hungary threatening to veto if such conditionality is added to the recovery package, while southern European countries are rejecting demands from the so-called frugal four, now five, countries (Netherlands, Austria, Finland, Sweden and Denmark) for a great sum bound by economic reform requirements.

EU Parliament to block recovery deal if it falls short of demands

The European Parliament will withhold support for any deal struck by EU governments on the bloc's huge coronavirus stimulus package if it fails to meet certain conditions, EP President David Sassoli said on Monday.

"The European parliament has set out its priorities and it expects them to be met," he said in a statement.

If these conditions are not sufficiently met, the European parliament will not give its consent.

EU lawmakers want the package to include measures to defend the rule of law, which could freeze funding to countries flouting democratic principles. Hungary, backed by Poland, has threatened to veto the package if its disbursement was made dependent on such conditions.

David Sassoli told EU leaders that even if they strike a deal, the package will still need to win approval from the European parliament.

The above indicate that even if an agreement is reached at the summit today, the EP will keep an eye on how its conditions are met and its plenary session, which will vote on the budget deal, will reject the proposal if it deviates too much. This would be a huge blow of prestige for the European Council and for individual leaders alike and would also lead to further lengthy talks before the summer ends.