Finance
EU lawmakers to vote on whether to launch legal challenge to Mercosur trade deal
Published by Global Banking and Finance Review
Posted on January 21, 2026
2 min readLast updated: January 21, 2026
Global Banking and Finance Review
Company
Published by Global Banking and Finance Review
Posted on January 21, 2026
2 min readLast updated: January 21, 2026
EU lawmakers will vote on a legal challenge to the Mercosur trade deal, which could delay its implementation by two years.
By Philip Blenkinsop
BRUSSELS, Jan 21 (Reuters) - EU lawmakers will vote on Wednesday on whether to challenge the European Union's contentious free trade agreement with South America in the bloc's top court, a move that could delay the deal by two years and potentially derail it.
The European Union signed its largest-ever trade pact with Mercosur members Argentina, Brazil, Paraguay and Uruguay on Saturday. The agreement now requires approval before it can take effect.
Opponents, led by France - the EU's largest agricultural producer - say the deal will sharply increase imports of cheap beef, sugar and poultry, undercutting domestic farmers who have staged repeated protests.
LEGAL CHALLENGE
A group of 144 lawmakers has lodged a legal challenge asking the EU Court of Justice to rule on whether the agreement can be applied before full ratification by all member states and whether its provisions restrict the EU's ability to set environmental and consumer health policies. The court typically takes around two years to deliver such opinions.
If referred to the court, the EU could still apply the pact provisionally pending the ruling and parliamentary approval. But doing so could prove politically difficult given the likely backlash, and the European Parliament would retain the power to annul it later.
The vote in parliament is due to take place at 1130 GMT.
Supporters including Germany and Spain point to U.S. President Donald Trump's disruption of global trade. They argue the deal is essential to offset business lost to U.S. tariffs and to reduce reliance on China by securing access to critical minerals. They also warn that Mercosur governments are losing patience with the EU after years of negotiations.
(Reporting by Philip BlenkinsopEditing by Mark Potter)
The EU Court of Justice is the highest court in the European Union, responsible for interpreting EU law and ensuring it is applied uniformly across member states.
Provisional application allows parts of a trade agreement to take effect before it is fully ratified by all parties, enabling immediate benefits while awaiting final approval.
Mercosur is a South American trade bloc that includes Argentina, Brazil, Paraguay, and Uruguay, aimed at promoting free trade and economic integration among its members.
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