The agreement’s two main pillars – market access and regulatory cooperation – cover goods, services and public procurement. In goods, tariffs will be progressively eliminated over five to ten years which will enhance food, energy and critical minerals security.
For Mercosur, benefits are concentrated in agriculture and light industry. The EU will reduce or eliminate tariffs on most agricultural exports, including meat, sugar and ethanol, while footwear and textiles will also benefit.
For the EU, the removal of tariffs in strategic sectors such as automobiles, machinery, and chemicals will create new opportunities for industrial exports and supply-chain integration.
In services, the agreement eases restrictions in areas such as business services, finance, telecommunications and transport. It also opens procurement markets, enabling firms from both regions to compete on equal terms for infrastructure and public-sector projects.
Regulatory cooperation will not impose new standards but will promote harmonisation and mutual recognition. Mercosur exporters will align more closely with EU standards, raising levels of quality, safety and sustainability.
Binding commitments on labour, environmental and social issues – including adherence to the Paris Agreement on climate change and specific deforestation targets – reinforce the sustainable development dimension of the deal.
However, ratification involves multiple steps: the trade element requires approval by the European Parliament and EU Council, while the political and cooperation chapters must be endorsed by all 27 member states.
Each Mercosur country must endorse the deal but the agreement allows for provisional implementation by individual members.