Ukrainian President Volodymyr Zelenskiy has agreed with the other members of the Trilateral Contact Group that oversees the negotiations to end fighting in the Donbas to adopt the so-called Steinmeier formula in an effort to bring the fighting in Ukraine’s eastern region to an end.

During the meeting of the contact group in the Belarusian capital Minsk, all the dialogue participants — Russia, the OSCE, the Ukrainian authorities and the self-proclaimed Donetsk People's Republic (DPR) and Luhansk People's Republic (LPR) — put their signatures on the document, according to Interfax.

In addition, the conditions for the separation of forces at two pilot sites in the Donbas were agreed in Minsk.

More details will be worked out at the upcoming Normandy Four meeting where Zelenskiy will face off against Russian President Vladimir Putin for the first time.

The deal means the occupied regions would hold elections and get a special self-governing status if those elections are deemed fair and free by international observers from the OSCE. Fighting would have to cease before the elections are held and Zelenskiy emphasised that Russian regular troops would have to withdraw from the region and Ukraine would have to take back full control of the borders before the elections could be held.

“There will be no elections ‘at the gunpoint’,” Zelenskiy said at a press conference on the same day. “If someone [militants] will be there, there will be no elections.”

The elections will be conducted by the Ukrainian Central Election Commission in accordance with Ukrainian law, Zelenskiy stressed, and Ukrainian observers, independent press and political organisations must be permitted to take part in the electoral process he added.

If the elections are free and fair the region will be granted an autonomous status. Zelensky didn’t specify what kind of self-governance the regions will obtain.

While the Kremlin is not involved in the talks, it is standing behind the separatist fighters in Donbas, supplying them with material and has sent thousands of unmarked soldiers into the fight, who are officially there “on holiday” when spotted by observers.

The deal may be acceptable to the Kremlin as part of the reason it has destabilised the Donbas is it provides a guarantee that Ukraine cannot join Nato – a red line issue for Russia. Nato rules preclude any country from becoming a member if it has a live border dispute with another country at the time of application.

As part of any resolution to the fighting Russia is looking for a guarantee that Ukraine will not join Nato in the future and an autonomous status for Donbas would be an option as the region would get a de facto veto on any attempt to join Nato by Ukraine, but the region would almost certain remain under the influence of Moscow.

Steinmeier’s formula was revived recently after a July 12 meeting when Vadym Prystaiko, Ukraine’s former representative to the Minsk process and now Ukraine’s new minister of foreign affairs, attended a meeting of advisors of the heads of states of the Normandy Four. Russia is now insisting on this formula and on August 27 Russian Foreign Minister Sergei Lavrov declared that one of the conditions for the next Normandy Four meeting to go ahead would be to have a commitment to the Steinmeier formula in writing.

Zelenskiy has been caught in an awkward position as he has declared he wants to bring the war in Donbas to an end, but at the same time he can’t be seen as giving in to Russia aggression.

As the news of the Steinmeier deal was announced hundreds of people began demonstrating outside the president’s offices to protest against the state giving any concessions to Russia.

However, others will welcome the news as after five years the Minsk II accords agreed between Russia, Germany and France have stalled and all the deadlines in the deal have been missed.

French President Emmanuel Macron has already thrown his weight behind the deal. “We must move on the basis of the Steinmeier formula. It is about the implementation of the Minsk agreements, about the demarcation line, about Crimea, about the Donbas,” Macron said during a speech at a Parliamentary Assembly of the Council of Europe (PACE) session in Strasbourg on the same day.

Technically Russia was not officially the counterparty in the Minsk II deal, which was signed by members of the Trilateral Contact Group, which represents the government in Kyiv and the rebel commanders.

The Steinmeier formula was proposed by former German foreign minister Frank-Walter Steinmeier in an effort to break the deadlock over the Minsk II deal.

The agreement lays the groundwork for upcoming Normandy Four talks between Russia, Ukraine, Germany and France.

However, there has clearly been a lot going on behind the scenes in preparation for this meeting. The European leaders German Chancellor Angela Merkel and Macron both clearly see a window of opportunity with the election of Zelenskiy to bring the conflict to an end.

Macron has been visibly active, and travelled to Russia to hold talks with Putin as well as calling Zelenskiy on the night of his election victory in April. Then within months of taking office Russia and Ukraine agreed to a prison of war exchange, the first significant exchange in five years of conflict. Now the Steinmeier formula has been introduced, which forms the basis of a compromise that could lead to a withdrawal of Russian troops from the Donbas.

The opposition to any compromise with Russia will be strong. Within hours of the announcement former president Petro Poroshenko issued a statement that the deal would lead to the lifting of sanctions on Russia. Poroshenko represents the hard line nationalists' view that Ukraine should join Nato and with the west help expel Russian troops from the Donbas by force. The western leaders are very reluctant to go down this road because of the obvious risk of escalation and ending up in a major European war with Russia. While Ukraine’s relations with Nato are particularly warm, Nato has not formally offered membership to Ukraine or even suggested that negotiations could begin for Ukraine to join the Nato Membership Action Plan, the precursor to membership.