Under the treaty, the South American bloc formed by Argentina, Brazil, Paraguay and Uruguay will eliminate tariffs on 91% of European goods within up to 15 years. The European Union, in turn, will remove tariffs on 95% of goods sold by Mercosur within up to 12 years.
The terms of the agreement were signed at the end of January in Asuncion, Paraguay, by representatives of both blocs after 26 years of negotiations.
The pact creates a free trade area covering 31 countries, 27 from the European Union and four from Mercosur, with a combined population of 720 million people and approximately US$ 22 trillion in gross domestic product.
Lula stated at the signing ceremony that the message sent by the European Union and Brazil is that democracy, multilateralism and cordial relations between nations remain essential foundations for international cooperation.
After lengthy diplomatic negotiations, ratification of the agreement was completed by the Brazilian National Congress in early March and promulgated a few days later.
This was the final step for the agreement to enter into force on the Brazilian side through the presidential decree signed by Lula. The parliaments of Argentina, Uruguay and Paraguay had also ratified the agreement.
On the European Union side, the European Parliament requested in January that the Court of Justice assess the agreement from a legal perspective. European Commission President Ursula von der Leyen nevertheless confirmed that the bloc would apply the treaty provisionally from May, even while judicial analysis remains pending.
Other agreements
At the same ceremony in which he validated the Mercosur-EU agreement, Lula also sent two other trade agreements to the National Congress for review. One is the Mercosur-Singapore agreement, announced in 2023. The Asian country is one of the main destinations for South American exports.
The other agreement involves Mercosur and the European Free Trade Association (EFTA), composed of Switzerland, Norway, Iceland and Liechtenstein.
The multilateral partnership will create a market of 290 million consumers in economies whose GDP totals US$ 4.39 trillion. Negotiations began in 2017 and, after 14 rounds, the final terms were agreed in June 2025.
In both cases, the legislatures of the Mercosur countries must approve the treaties for them to enter formally into force.
Source: Conjur
