EU announces provisional application of Mercosur trade deal

The European Commission, led by President Ursula von der Leyen, announced the provisional application of the EU-Mercosur trade agreement, following ratification by Argentina and Uruguay. This step proceeds despite legal doubts raised by the European Parliament, which sent the treaty for review by the Court of Justice of the European Union (CJEU).

Key points

• The provisional application allows companies in the EU, Uruguay, and Argentina to benefit from new customs rules before the formal entry into force.
• The European Parliament had previously decided to have the European Court of Justice (CJEU) review the agreement before a final vote.
• The agreement, signed in January after over 25 years of negotiation, aims to create one of the world's largest free trade areas.
• Von der Leyen defended the move as strategically necessary, especially given uncertainty in US trade relations.
• The deal faced resistance from the European agricultural lobby due to fears of competition from Mercosur agricultural products.

Why it matters

The provisional application is relevant because the formal ratification could be delayed for months or longer pending the CJEU's opinion, and the move is seen as a signal against US protectionist trade policy.