March 12, 2026

EU To Provisionally Apply EU–Mercosur Interim Trade Agreement Pending CJEU Opinion

Charles Julien, Julia Marssola, Sara Nordin, Samuel Scoles White & Case LLP + Follow Contact LinkedIn Facebook X Send Embed

On 27 February 2026, the European Commission announced it will proceed with the provisional application of the EU–Mercosur Interim Trade Agreement ("iTA"), notwithstanding the European Parliament's request for a prior opinion from the Court of Justice of the European Union ("CJEU") on the agreement's compatibility with EU law.

Following completion of ratification procedures by Argentina and Uruguay on 26 February 2026, provisional application of the iTA could begin as early as May 2026.

Background: From Political Deal to CJEU Referral

After more than 25 years of negotiations, 1 the EU and the founding Mercosur members (Argentina, Brazil, Paraguay and Uruguay) reached a political deal on a partnership agreement on 6 December 2024. 2 On 3 September 2025, the European Commission adopted proposals on the signature and conclusion of two separate legal instruments:

• EU–Mercosur Partnership Agreement ("EMPA") – covers political dialogue, cooperation and broader institutional provisions.

• iTA – covers trade provisions.
  Following the adoption of the EU proposals, several related steps have been taken in the beginning of 2026:

• On 9 January 2026, the Council of the EU authorised the signing and conclusion of both instruments, 3 as well as the provisional application of the iTA under certain conditions. The iTA was approved in the Council despite opposition from five EU Member States (i.e., France, Poland, Ireland, Austria, and Hungary) and an abstention by Belgium — reflecting divergent views amongst Member States.

• On 17 January 2026, both the EMPA and the iTA were officially signed. 4 The parties began their respective ratification procedures. 5

• On 21 January 2026, the European Parliament passed a resolution requesting an opinion from the CJEU on the compatibility of the EMPA and the iTA with EU law, 6 while suspending the consent procedure pending the Court's review.

• On 26 February 2026, on the Mercosur side, Argentina and Uruguay completed their domestic ratification procedures for the iTA. 7

• On 27 February 2026, European Commission President Ursula von der Leyen announced that the Commission would move forward with provisional application of the iTA pending the CJEU's opinion. 8

Parliament's Referral to the CJEU

Pursuant to Article 218(11) of the Treaty on the Functioning of the European Union ("TFEU"), 9 the European Parliament referred the iTA and the EMPA to the CJEU, raising concerns about their compatibility with EU law. 10 The referral is framed around three principal issues:

1. Agreement structure – The European Parliament questions whether dividing the EU–Mercosur partnership agreement into two separate instruments (the EMPA and the iTA) is consistent with the division of competences under EU law and with the Council's original negotiating mandate, which may have envisaged a single, comprehensive agreement. There are also concerns that splitting the agreement could limit the role of national parliaments and prevent them from "having their legitimate say" on the full package.
2. The "rebalancing clause" – The Parliament seeks clarification on whether the clause allowing one party to seek compensation if the other adopts measures that "nullify or impair" the expected benefits under the agreement is compatible with EU law and would not "threaten the EU's ability to maintain the autonomy of the EU legal order". The underlying concern is that this mechanism could be invoked by Mercosur countries to pressure the EU to refrain from enacting or enforcing legislation in areas such as climate policy, environmental protection, food safety, or restrictions on certain pesticides.
3. Precautionary principle – The Parliament expresses concern that certain provisions, including the role of arbitration panels, could affect the EU's ability to apply the precautionary principle. This principle permits the EU to inter alia adopt protective measures, including in situations involving potential risks to public health, consumer safety, or the environment, even in the absence of conclusive scientific evidence of risk. If the CJEU finds incompatibility with EU law, the agreements will not be able to enter into force in their current form and would require amendment or renegotiation. If the Court were to find the agreements are compatible with EU law, then the consent procedure would resume. The Article 218(11) opinion process typically takes one to two years, 11 making a ruling before 2027 unlikely.

Provisional application of the iTA

The iTA can be provisionally applied between the EU and one or more Mercosur signatory states, subject to mutual notification of completion of internal ratification procedures (including as per Article 23.3 of the iTA and as expressly authorised by the Council).

Provisional application begins on the first day of the second month following mutual notification of completed internal procedures. The Commission is expected to publish a notice specifying the date of provisional application in the Official Journal as part of next steps. 12 With Argentina's and Uruguay's ratifications on 26 February 2026, provisional application of the iTA between the EU and relevant Mercosur signatory states could begin as early as May 2026. Brazil and Paraguay are also moving forward with their internal ratification procedures.

Provisional application of international, and especially EU, agreements before full ratification is not unprecedented. For example, the EU has provisionally applied most of the Comprehensive Economic and Trade Agreement with Canada since 2017, despite this agreement not being fully ratified by all EU Member States. 13

While the European Parliament's referral to the CJEU does not legally prevent provisional application of the iTA, the Commission's decision to proceed despite the pending review by the CJEU has exposed ongoing divisions amongst EU Member States in relation to the EU-Mercosur agreements. Supporters, including Germany and Italy, have welcomed the move, while critics, including France, remain sharply opposed. Strong opposition also remains within the European Parliament across several political groups. This political context will be highly relevant going forward, including in relation to any future resumption of the consent vote by the European Parliament.

Ratification outlook

Mercosur governments are closely monitoring the CJEU proceedings. If the Court issues an adverse opinion requiring renegotiation, this could delay full implementation and complicate domestic political support for the agreement. However, the possibility of provisional application of the ITA upon ratification by a Mercosur signatory state has prompted accelerated parliamentary debate and ratification efforts throughout the Mercosur bloc.

| Argentina | iTA ratification completed on 26 February 2026. 14 |
| Uruguay | iTA ratification completed on 26 February 2026. 15 |
| Brazil | Approved by the Chamber of Deputies on 25 February 2026 and by the Federal Senate on 04 March 2026. 16 Next step is promulgation by Brazilian President Luiz Inacio Lula. |
| Paraguay | Paraguayan Senate unanimously approved the iTA on 4 March 2026, and the file has now moved to the Chamber of Deputies for consideration. 17 |

Implications for businesses

Once the iTA is applied provisionally, preferential tariff treatment and other trade facilitation provisions will become available between the EU and those Mercosur countries that have completed ratification.

For many industries, this will mean a phased reduction or elimination of tariffs over a transition period of up to 18 years, the introduction of tariff-rate quotas for sensitive agricultural goods, and improved legal certainty for cross-border trade in goods and services. Sectors such as automotive, machinery, chemicals, pharmaceuticals, agri-food, and consumer goods are expected to experience the most significant tariff benefits.

EU exporters to Mercosur, for example, will see progressive removal of tariffs on products originating in the EU including vehicles, clothing and textiles, leather footwear, spirits, wine, chocolates, machinery, automotive parts, chemicals, and pharmaceuticals. Certain EU dairy products, such as cheese, milk powder and infant formula, will receive zero-duty access to the Mercosur market within agreed quota limits.

Mercosur exporters will benefit from the gradual elimination of EU tariffs on a range of manufactured goods, including vehicles and automotive parts, footwear, clothing and textiles, and orange juice. The agreement also establishes duty-free or reduced-duty annual quotas for agricultural exports to the EU, including beef, poultry, sugar, ethanol, honey, and rice.

To benefit from the agreement, businesses must ensure their products meet the iTA's rules of origin and related documentary/procedural requirements. Companies should assess their supply chains, sourcing structures, and customs compliance processes to confirm eligibility from day one of provisional application. As the agreement will apply bilaterally, businesses should also monitor which Mercosur countries are covered at any given time.

Notably, in light of the circumstances provisional application of the iTA would introduce a degree of legal and political uncertainty. While the iTA provisions would be fully operational, they will remain subject to the outcome of the CJEU proceedings and the European Parliament's consent vote. If the EU ratification process of the iTA is not completed, provisional application could be terminated temporarily or indefinitely; while this would not be expected to have an impact on goods already entered under provisional application, it would have a future trade impact. Businesses should consider this risk in contractual arrangements, pricing, and investment decisions tied to preferential market access under the iTA.

1 Click here to view White & Case client alert "Mercosur and European Union Struggle to Finalize FTA Negotiations."
2 Click here to access the European Commission press release on the political agreement.
3 Click here to access the Council of the EU press release. The Council Decisions on the iTA (Council Decision (EU) 2026/183) and the EMPA (Council Decision (EU) 2026/185), published in the Official Journal on 27 February 2026, are available, respectively, here and here.
4 Click here to access the European Commission press release on the signature. Click here to access the full text of the EMPA, and here to access the full text of the iTA, both published in the Official Journal on 27 February 2026.
5 Because it is confined to matters of exclusive EU competence, the iTA follows an EU-only ratification procedure (qualified majority in the Council and consent of the European Parliament). In contrast, the EMPA requires unanimous Council approval and ratification by all 27 Member States. Once the EMPA enters into force, it will repeal and replace the iTA.
6 Click here to access the European Parliament press release, and here to access the relevant Motion for a Resolution seeking the opinion of the CJEU (B10-0060/2026).
7 Click here to access the Mercosur Secretariat's press release (in Spanish).
8 Click here to access the statement by the President of the European Commission.
9 This provision allows EU institutions to seek an ex ante ruling on whether an international agreement complies with the EU Treaties. The full text of the provision reads as follows: "11. A Member State, the European Parliament, the Council or the Commission may obtain the opinion of the Court of Justice as to whether an agreement envisaged is compatible with the Treaties. Where the opinion of the Court is adverse, the agreement envisaged may not enter into force unless it is amended or the Treaties are revised."
10 Click here to access the European Parliament's Motion for a Resolution seeking the opinion of the CJEU (B10-0060/2026).
11 For example, Opinion 2/15 of the CJEU from 16 May 2017 on the compatibility of the EU-Singapore Free Trade Agreement with EU law, accessible here, was issued within 22 months of the European Parliament's referral.
12 In accordance with Article 3(2) of Council Decision (EU) 2026/183.
13 As of 2 March 2026, ratification of the CETA was pending in ten EU Member States. Click here for the status of ratification of the CETA in EU Member States.
14 Click here to access Ley No. 27800 ratifying the iTA in Argentina, published in the Boletin Oficial on 26 February 2026 (in Spanish).
15 Click here to access Ley NO. 20462 ratifying the iTA in Uruguay (in Spanish).
16 Click here to see press release of the Brazilian Federal Senate (in Portuguese).
17 Click here to access the Paraguayan press release (in Spanish).

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