EU and Mercosur sign Partnership Agreement and Interim Trade Agreement

On 17 January 2026, the European Union and the Mercosur countries (Argentina, Brazil, Paraguay and Uruguay) signed the EU–Mercosur Partnership Agreement (EMPA) and an accompanying Interim Trade Agreement (iTA).

The agreements introduce a new framework for trade between the EU and Mercosur, with a strong focus on tariff liberalisation for goods traded between the two trading blocs. Once applied, the agreements will significantly reduce or eliminate customs duties on a broad range of products traded cross-border between the EU and Mercosur.

Tariff liberalisation and customs impact

The removal of tariffs on EU exports to Mercosur, and vice versa, is expected to create substantial commercial opportunities for companies active in EU–Mercosur trade flows. Sectors expected to benefit most include:

• agri-food products such as wine, spirits, dairy products and olive oil; and
• industrial goods, including cars, machinery, textiles and apparel, pharmaceuticals and chemicals.

According to the European Commission, EU exports to Mercosur could generate annual customs duty savings of approximately €4 billion once tariff elimination is fully implemented.

These customs duty savings are conditional upon compliance with the agreement’s preferential rules of origin and the applicable customs formalities.

Protection of sensitive agri-food sectors

Alongside tariff liberalisation, the EU has included a number of measures aimed at protecting sensitive agri-food sectors. These include:

• tariff-rate quotas (TRQs) limiting preferential access for certain sensitive products originating in Mercosur;
• a legally binding bilateral safeguard mechanism allowing the EU to act in the event of a sudden surge in imports from Mercosur; and
• enhanced controls to prevent non-compliant products from entering the EU market, including additional audits in third countries and reinforced controls at EU borders.

These measures are relevant for importers, as they may affect customs clearance, quota administration and compliance obligations.

Ratification and entry into force

Following signature, the EU and Mercosur will now proceed with their respective ratification processes.

• The EMPA will require ratification by all EU Member States in accordance with their national constitutional procedures.
• The iTA, which covers areas falling under EU exclusive competence (including customs duties and trade in goods), will follow an EU-only ratification procedure. This requires the consent of the European Parliament and adoption by the Council, after which the iTA may enter into force.

The iTA will apply on a temporary basis and will expire once the EMPA enters into force.

Practical considerations for businesses

Companies trading between the EU and Mercosur are advised to review their supply chains and sourcing structures at an early stage to assess whether and how they can benefit from the preferential tariff treatment under the agreements.

In particular, businesses should assess:

• whether their products are likely to meet the preferential rules of origin;
• the availability and reliability of origin documentation (such as supplier declarations); and
• the potential impact of quotas, safeguards and enhanced customs controls on their trade flows.

Failure to meet origin or compliance requirements may result in the denial of preferential treatment, post-clearance recovery of underpaid customs duties and increased customs risk.

We are happy to assist with analyzing the customs implications of the EU–Mercosur agreements and to support businesses in preparing for their implementation, including preferential origin assessments and supply-chain reviews.