The European Union is likely to start applying its free trade agreement with the South American bloc Mercosur on a provisional basis as early as March 2026. Reuters reported this, citing an EU diplomat.
According to the source, the agreement may be provisionally applied once the first Mercosur country ratifies it, and Paraguay is expected to do so in March.
As a reminder, the EU signed what is set to become the largest trade pact in its history with Brazil, Argentina, Paraguay and Uruguay after 25 years of negotiations. However, developments this week complicated the process: EU lawmakers referred the agreement to the Court of Justice of the European Union, which could delay its full entry into force by up to two years.
Germany and business criticize a potential delay
The prospect of a prolonged delay has sparked a strong reaction in Germany and among business representatives. Supporters argue the deal is needed to offset losses from U.S. tariffs and reduce Europe’s dependence on China.
In particular, DHL CEO Tobias Meyer said postponement would “undermine Europe’s competitiveness” and put jobs and prosperity at risk. German Chancellor Friedrich Merz also criticized the European Parliament’s decision, stressing that the agreement is “fair and balanced” and important for EU economic growth.
France opposes “provisional implementation”
Meanwhile, in France — one of the deal’s leading critics — provisional application is considered unacceptable. Opponents warn the agreement could lead to increased imports of cheaper beef, sugar and poultry, intensifying competition for European farmers.
French agricultural unions have already staged protests, including in Paris, where hundreds of tractors blocked roads and key landmarks. Franck Sander, head of the CGB sugar beet producers’ lobby, said provisional application would amount to a “denial of democracy.”
The European Commission, for its part, said it plans to consult EU governments and lawmakers before deciding on the next steps regarding how the agreement should be implemented.
EU leaders are also expected to discuss the situation amid rising transatlantic tensions following comments by U.S. President Donald Trump on potential tariffs if the United States is not allowed to purchase Greenland.