Overview
- The pact was signed in Asunción by leaders including Ursula von der Leyen, Javier Milei, Santiago Peña and Yamandú Orsi, while Brazil’s Luiz Inácio Lula da Silva did not attend.
- The agreement is not yet in force and must be approved by Mercosur members and parliaments in both regions, with experts projecting possible entry into force in late 2027.
- The text phases out many tariffs, creates tariff‑rate quotas for sensitive products such as beef, poultry, rice, maize, honey, cheeses and milk powder, and preserves Mercosur exclusions covering about 9% of EU imports.
- Bilateral safeguards allow temporary withdrawal of preferences if imports surge or if Mercosur import prices are roughly 10% below EU comparators, with reciprocal mechanisms available to both sides.
- For Argentina, most export duties on EU‑bound goods would be suspended from year three with specified exceptions, major business groups publicly endorsed the deal’s export and investment potential, and European farm organizations voiced reciprocity concerns as some lawmakers discuss seeking a court opinion during ratification.