In a statement, the European Commission said that it had completed the final formal step required for the provisional application of the trade agreement by sending a note verbale to Paraguay, which currently holds the Mercosur presidency.

“The trade agreement will thus be provisionally applied from 1 May between the EU and all Mercosur countries that complete their domestic ratification procedures and officially notify the European Union of this completion before the end of March. Argentina, Brazil and Uruguay have each completed ratification and have already sent such notification.

Paraguay recently ratified the agreement and is expected to submit its notification to the EU shortly,” the EU official stated.

The European Commission notes that provisional application will immediately remove tariffs on certain products and create predictable rules for trade and investment.

Benefiting businesses

EU businesses, consumers and farmers will begin benefiting from the agreement immediately, while protections remain in place for sensitive sectors.

The European Commission adds that provisional application will ensure closer cooperation between the EU and Mercosur on issues such as labour rights and climate change, and will “create more resilient and reliable supply chains, which are essential above all for the predictable flow of critical raw materials”.

Institution credibility

Quoted in the statement, Trade Commissioner Maroš Šefčovič believes that it is an important day for the EU to prove its “credibility as a major trading partner”.

“The priority now is to turn this EU-Mercosur agreement into concrete results, giving EU exporters the platform they need to seize new opportunities for trade, growth and jobs. Provisional application allows us to start delivering on that promise,” he said.

Provisional application

On 27 February, the President of the European Commission indicated that the institution would proceed with the provisional application of the agreement between the EU and Mercosur, which has been contested by the agricultural sector and by countries such as France and Poland.

The agreement can only be fully concluded once it has been voted on and approved by the European Parliament, a process that is currently stalled after MEPs decided in January to refer the agreement to the Court of Justice of the EU to verify its compliance with EU law.

20 years of negotiations

The agreement, signed on 17 January after more than 20 years of negotiations, aims to eliminate or drastically reduce customs tariffs between the two blocs.

In addition to the trade component, the agreement includes a political partnership that must be ratified by all member states.

The Southern Common Market (Mercosur) is a South American intergovernmental organisation founded in 1991, headquartered in Montevideo.

It is one of the largest economic blocs in terms of gross domestic product (GDP), the world’s largest food producer, and comprises Argentina, Brazil, Paraguay and Uruguay.