Mercosur deal put on ice as Parliament seeks ECJ Opinion

The European Parliament has narrowly voted to ask the Court of Justice of the European Union to assess whether the EU–Mercosur trade agreement is compatible with EU treaties, effectively suspending the parliamentary ratification process.

The motion passed by 334 votes to 324, with 11 abstentions. While the vote did not address the substance of the trade deal itself, it prevents the Parliament from proceeding to a consent vote until the Court delivers its opinion, a process that is likely to take at least a year and potentially longer.

Signed on 17 January, the agreement would create a vast free trade area, but it remains highly divisive.

Political Fault Lines

Critics argue that the way the agreement has been split into EU-only and mixed components could sidestep national parliaments. They also question a safeguard mechanism that would allow Mercosur countries to take countermeasures if future EU legislation negatively affects their exports.

The outcome underlines how divisive the agreement remains, even after years of negotiations. Supporters present Mercosur as both an industrial opportunity and a geopolitical signal at a time of rising global trade tensions. 

Opponents, particularly in agricultural sectors, warn of increased competition, downward pressure on prices and uneven standards. France and Poland have been among the most vocal sceptics.

The European Commission is not legally barred from pursuing provisional application of parts of the agreement if it secures sufficient backing from member states. Doing so, however, would risk escalating tensions between EU institutions and could further politicise the ratification process.

Parliament split down the middle

The vote exposed a Parliament almost evenly split. While the EPP and S&D leaderships opposed the referral, backing the Commission’s push to keep the agreement moving, several members in both groups broke ranks. The Conservatives and Reformists allowed a free vote, revealing deep national divisions. French and Polish MEPs largely supported the referral, while Italian, Czech, Belgian and Baltic lawmakers tended to oppose it.

Opposition to the agreement cut across traditional political lines. Eurosceptic parties, the Greens, the Left and parts of Renew Europe backed the referral. The far-right Patriots for Europe group also voted in favour, aligning tactically with left-wing MEPs despite sharply different motivations.

Commission President Ursula von der Leyen has framed Mercosur as a pillar of fair trade and long-term partnerships, reiterating that case during the signing ceremony in Asunción in January. That argument, however, failed to carry the chamber.

Market access deferred

For European exporters, the agreement still promises broader access to South American markets once it enters into force. For now, its fate depends less on legal interpretation than on political will. A ruling from the Court is likely to shape the debate, but not to resolve it.

Image Credits: Luxofluxo. (2023). Palais de la Cour de Justice CJEU March 2023 Sign, Towers C,B and A and the Anneau building. Wikimedia Commons. https://en.wikipedia.org/wiki/File:Palais_de_la_Cour_de_Justice_CJEU_March_2023_Sign,_Towers_C,B_and_A_and_the_Anneau_buiding.jpg