The move comes as the EU faces mounting pressure from the agricultural sector to maximise market protection and ensure a level playing field for European businesses.
After more than 20 years of negotiations, the EU and MERCOSUR reached an agreement in December 2024 to establish what will become the world’s largest free trade area, encompassing a market of more than 700 million consumers.
After more than 20 years of negotiations, the EU and MERCOSUR reached an agreement in December 2024 to establish what will become the world’s largest free trade area, encompassing a market of more than 700 million consumers.
In September 2025, the European Commission (EC) approved the EU–MERCOSUR Free Trade Agreement (FTA) and called on member states to ratify the document.
The agreement with Argentina, Brazil, Paraguay, and Uruguay is seen as a major opportunity to strengthen the EU’s competitiveness and open new markets for goods and services.
European Commission President Ursula von der Leyen affirmed that EU businesses and the agri-food sector will benefit from reduced tariffs and lower costs. According to the Commission, the deal could increase the EU’s annual exports to the MERCOSUR bloc by up to 39%, equivalent to 49 billion Euro. In return, agricultural nations such as Brazil and its neighbours will gain easier access to European markets for products such as meat, sugar, honey, and soybeans.
As MERCOSUR countries gradually remove import tariffs on 91% of EU goods, the agreement is expected to save European exporters more than €4 billion in customs duties annually in Latin America. However, the deal faces fierce opposition from European farming groups, particularly in France, which fears the weakening of its domestic agricultural sector.
European farmers have accused South American producers of failing to comply with the EU’s strict standards due to weak enforcement mechanisms. They argue that the deal will increase imports of sugar, beef, and poultry, driving down prices in the European market and making local farmers less competitive.
To reassure them, the EC pledged to intervene if imports negatively affect sensitive sectors such as beef, poultry, sugar, and ethanol. It announced it would launch a competition investigation if import prices from MERCOSUR countries fall more than 10% below comparable EU products, or if duty-free import volumes rise by over 10%.
The Commission also committed to activating safeguard measures within no more than 21 days upon a justified request from an EU member state. Any investigation must be completed within four months, and if it concludes that EU agriculture has suffered serious harm, tariffs on the affected products may be re-imposed.
The EU remains one of MERCOSUR’s largest trading partners, with bilateral trade reaching nearly USD 87 billion in 2024. The FTA between the two sides is expected to provide a breakthrough for economic and trade cooperation amid an increasingly complex global geopolitical landscape.
Nevertheless, the agreement still faces one of its most sensitive hurdles — compliance with sanitary and environmental standards — and must be approved by at least 15 of the EU’s 27 member states as well as by the European Parliament before it can take effect.
