Michel Barnier has told EU ambassadors that he is having to repeatedly rebut British demands for a time limit on the Irish backstop but that he is working on a legal add-on to the Brexit deal to help the prime minister.

During a meeting on Friday in Brussels, the EU’s chief negotiator expressed frustration with the British demands after the latest round of talks. “The UK side keeps on insisting on the same two things,” one EU diplomat said following Barnier’s briefing after the latest week of talks. “And we keep on explaining why it won’t happen.”

But in an interview with the German newspaper Die Welt, Barnier publicly admitted for the first time that he was looking at drafting a joint interpretative instrument as an adjunct to the withdrawal agreement. He also suggested that the parliamentary arithmetic might be moving in the prime minister’s favour.

“We will not allow a time limit or a one-sided exit right,” Barnier told the newspaper. “What can exist is the commitment to limit the backstop through an agreement on the future relationship … in the form of an interpretive document. Like the joint letter from Donald Tusk and Jean-Claude Juncker. If this document were combined with a written commitment from the British, then obviously it would have a much greater power.”

It is the first time the EU official has publicly confirmed that such a legal instrument, previously used by the bloc to sweeten deals by offering an optimistic interpretation of terms of draft treaties, was a possibility.

The EU’s 27 heads of state and government rejected such a step last December as they did not want to offer any suggestion of a time limit to the backstop, even if it involved a soft target for escaping from the arrangement. It had been mooted at the time that the legal document would commit both sides to trying to get out of the backstop within 12 months of it being triggered. The leaders rejected the idea as they were not convinced that such an interpretation was feasible or that it would persuade the Commons to back the deal.

A letter from Tusk, the European council president, and his European commission counterpart, Juncker, sent to May in January had committed the EU to ensuring that the backstop was temporary, although there was no specific time limit.

Barnier declined to offer any further detail when pressed by Die Welt. “That’s currently in the negotiations. The substance has priority. The legal form comes afterwards.”

Barnier disclosed, however, that Jeremy Corbyn had told him during a recent visit to Brussels that Labour was poised to back a second referendum. “Jeremy Corbyn sat at this table last week and told me that he would announce support for a second vote,” he said. “I cannot say if there will be such a vote at all, whether enough MPs would vote for it. That is not my basis. I only work on objective fundamentals.”

Theresa May is seeking legally binding changes to the withdrawal agreement to reassure MPs that the Irish backstop will be temporary.

Downing Street is said to have been encouraged by the suggestions that Brexiters in the European Research Group in her party appear to be looking for a way to back down on their resistance to the deal.

Jacob Rees-Mogg, the chair of the ERG, has recently said he would accept a mere add-on to the withdrawal agreement, but insisted that this would need to include a time limit on the all-UK customs union envisaged in the Irish backstop.

Barnier told Die Welt that he sensed that “something was moving” in the UK. An EU diplomat said: “Barnier seemed to think that the attorney general, Geoffrey Cox, at least offered a more realistic position, brainstorming to find something that was within the EU’s red lines.”

The Brexit secretary, Stephen Barclay, and Cox were expected back in Brussels on Tuesday for further negotiations.

At the meeting of ambassadors with Barnier on Friday morning, the 27 member states agreed that the length of a delay to Brexit would depend on the reason given by the prime minister.

The EU is examining a range of options if the UK makes a formal request for an extension, with the potential length ranging between two and 21 months. But legal experts have advised the German parliament that any Brexit delay beyond the European elections on 23-26 May could be in breach of EU law and leave the UK open to legal action, according to a confidential report seen by Die Welt.

The newspaper said the Bundestag’s European law experts had concluded that even the “short, limited” two- or three-month extension to article 50 beyond 29 March promised to MPs by May if they again vote down her Brexit deal could prove problematic.

“Failure by the UK to hold European parliament elections in the event of an agreed extension of the negotiation deadline under article 50 raises deep concerns regarding the right of citizens to vote and stand, as well as … possible legal consequences,” Die Welt quoted the advice as saying.

If the UK does not take part in the European elections while it is still officially a member of the bloc, “British nationals resident in the UK would be denied a core set of rights giving them EU citizenship status,” the advice said. This would amount to “a violation of the active and passive voting rights of British nationals”.