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The European Commission has announced on 27 February that it would begin the provisional application of the EU-Mercosur trade agreement, following ratification by Uruguay and Argentina. Brazil and Paraguay are expected to follow in the coming weeks. The move comes despite an ongoing judicial review in the European Parliament.

The agreement, negotiated over 25 years, creates a free-trade area covering more than 720 million people and is designed to lower tariffs on a wide range of goods, from cars and machinery to pharmaceuticals. European exporters are expected to save over €4 billion annually in duties, while the deal also opens new opportunities in services, digital trade, and government procurement. For logistics and trading companies, this means reduced costs, streamlined customs procedures, and improved access to critical raw materials, including those essential for the green and digital transitions, such as niobium, of which Mercosur is a key global supplier.

In a statement President von der Leyen framed the decision as a necessary step to secure Europe’s strategic position in an increasingly fragmented global economy. “When they are ready, we are ready,” she stated, referring to the Mercosur countries’ ratification process. The Commission’s legal basis for provisional application was authorised by the European Council in January, allowing the EU to act before full parliamentary consent is granted. However, the European Parliament remains divided, with some MEPs arguing that the process bypasses democratic scrutiny. French President Emmanuel Macron criticised the move as “a bad surprise,” emphasising the need to address concerns from the agricultural sector and respect the role of EU institutions.

The deal includes bilateral safeguards to protect sensitive sectors, particularly agriculture, and establishes a framework for political dialogue on issues such as climate action, digital transformation, and sustainable development. While provisional application allows for immediate economic benefits, full ratification by the European Parliament and all member states is still required for the agreement to take permanent effect. For the logistics sector, the interim measures offer a preview of the long-term opportunities that deeper EU-Mercosur integration will bring.