This analysis provides an overview of the current state of the EU–Mercosur Agreement and explains the transition from negotiation to ratification, marking the beginning of a new and politically sensitive phase.

Against this background, attention is first devoted to the institutional dimension, where the recent formal authorisation by the EU Council to proceed with the signature of the agreement signals a renewed momentum at EU level, while at the same time leaving unresolved a series of significant political and legal challenges that are likely to shape the forthcoming ratification process.

The analysis then turns to the legal architecture of the agreement, providing a concise analysis of the two legal instruments that together constitute the agreement: the “Interim Trade Agreement” and the “EU–Mercosur Partnership Agreement”. This section delineates briefly the respective scope and objectives of each instrument and underscores their fundamental distinction, the fact that they are subject to two different ratification procedures.

The following section turns to the issue currently at the centre of the political and institutional debate, namely the potential recourse to provisional application. It focuses on the legal basis enabling the early implementation of trade-related provisions, while also examining the reasons why this option continues to give rise to significant controversy. In this context, particular emphasis is placed on concerns expressed by the European Parliament regarding democratic oversight and institutional balance, as well as on the asymmetric nature of the enforcement mechanisms governing trade obligations as compared with those applicable to sustainability- and climate-related commitments.

The discussion continues considering the positions of Member States and economic stakeholders. It outlines the strong support expressed by export-oriented industries, which anticipate rapid and tangible economic gains, alongside persistent resistance from agricultural producers and a few Member States concerned about potential market disruption, regulatory divergence, and adverse environmental effects.

The final section provides a forward-looking evaluation of where political and institutional attention is expected to concentrate in the coming days and months. It points to the role of the European Parliament, including possible legal initiatives and forthcoming approval decisions, as well as to the choices that may be exercised by the Council regarding provisional application.

Going forward, close attention will be required as developments unfold, given that the forthcoming steps are likely to shape the timing, trajectory and long-term political sustainability of the EU–Mercosur Agreement.

INDEX

The Latest Institutional Development The Interim Trade Agreement The EU-Mercosur Partnership Agreement The Provisional Application and the position of the EU Parliament The position of the Member States and Industries What to expect

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The Latest Institutional Development

After years of intermittent progress, in early 2026 the EU–Mercosur agreement decisively returned at the top of the European agenda.

The last few days have clarified two things at once: institutional momentum is real, as the European Union has formally paved the way for signature, but the most difficult political challenges now lie in the ratification phase, which could still slow or, for some experts, reshape the path to entry into force.

On 9 January 2026, the EU Council approved the signature of the EU–Mercosur comprehensive partnership and trade agreement package which includes:

the Interim Trade Agreement (“iTA”). and the EU-Mercosur Partnership Agreement (“EMPA”),

Although both are integral components of the same agreement, these two components will follow different institutional procedures. The trade provisions will advance under EU exclusive competence, while the broader Partnership Agreement has been qualified as a mixed agreement.

In practical terms, under Article 218(6) TFEU, both acts must first be approved by the European Parliament but only the EMPA will also be subject to ratification by all Member States.

This “split approach”, as designed by the Commission and endorsed by the Council, was intended to advance the trade agreement, limiting legal and political friction, but it has also fuelled controversy over provisional application, i.e. the possibility of applying trade provisions before full parliamentary approval.

As a result, the process is still far from concluded.

The Interim Trade Agreement

The Interim Trade Agreement is focused on trade and investment liberalisation. It will operate as a separate agreement until the full EMPA comes into force.

Its main goal is to deliver economic benefits as quickly as possible. Indeed, the agreement provides tariff reductions and new market access for a wide range of goods and services. It also includes measures to facilitate investment and to reduce barriers to cross-border trade in services. Furthermore, it includes rules on government procurement which will allow EU companies to take part in public tenders in Mercosur countries.

Under EU law, the Interim Trade Agreement is considered to fall under the European Union’s exclusive competence. Pursuant to Article 218(8) TFEU, this allowed the Council to decide by qualified majority and removed the need for national ratification at this stage. On this legal basis, the Council decision of 9 January formally authorises the signing of the agreement on behalf of the European Union.

Commission President Ursula von der Leyen and European Council President António Costa are already preparing to travel to Paraguay, which currently holds Mercosur’s rotating presidency, to sign the agreement probably within the end of the week.

Then, while the European Parliament cannot amend the text, it must decide whether to approve or reject it. The vote is expected to be finely balanced, with Members of the European Parliament likely to vote more along national lines than according to political affiliation.

However, ahead of the vote, MEPs are expected to decide whether to request a legal opinion from the Court of Justice of the EU on the legality of the split approach and the classification of the Interim Trade Agreement as falling under EU exclusive competence. The proposal, first tabled in November 2025 by 145 MEPs, was temporarily blocked pending clarification of the Council’s position. Now, the vote could take place during the next plenary session, starting on 19 January. If approved, the request would likely delay ratification, but it would not necessarily prevent the provisional application of the trade provisions, should the Council decide to proceed.

The EU-Mercosur Partnership Agreement

The EMPA establishes a single framework for political dialogue, cooperation, and sectoral engagement between the parties, including a trade and investment pillar that will apply once the agreement enters into force. It aims to strengthen cooperation in key areas such as sustainable development, climate action, digital transformation, human rights. Lastly, the agreement promotes closer coordination on global challenges and supports the exchange of best practices, while reinforcing coordination in multilateral fora.

As said, the Partnership Agreement qualifies as a mixed agreement under Article 217 TFEU. It means that, after the EU Parliament vote, the broader partnership elements would require also national ratifications in EU member states.

The Provisional Application and the position of the EU Parliament

The most debated topic in recent days surrounding the EU-Mercosur Agreement concerns the possibility of its provisional application.

After the signature in Paraguay, under Art. 218(5) TFUE, the Council may decide to provisionally apply the Interim Trade Agreement even before the European Parliament has expressed its vote on it.

Provisional application would be a turning point because it allows key market-access commitments, such as tariff reductions, to apply before the whole Agreement is formally concluded and fully ratified.

The EU Parliament still retains the right to approve or reject the deal later but many MEPs fear that putting the agreement into practice first and asking for political approval afterward, would weaken democratic scrutiny.

Moreover, it has been argued that provisional application creates an inherent asymmetry. Economic benefits can take effect quickly, for example through the immediate reduction or elimination of tariffs, and these commitments are supported by strong enforcement mechanisms, including binding dispute settlement and the possibility of trade retaliation. By contrast, sustainability and climate-related commitments, such as labour and environmental standards, are subject to weaker enforcement, as they rely on dialogue and expert-based procedures rather than trade sanctions.

For these reasons, in response to the European Commission’s proposal, the European Parliament adopted, on 16 December, a position focused on strengthening the rules governing the implementation of the trade agreement:

It adopted a position on bilateral safeguard measures aimed at preventing imports from Mercosur countries from causing serious injury to the EU agricultural sector. The approved text allows the EU to temporarily suspend tariff preferences for sensitive agricultural products, notably poultry and beef, originating from Argentina, Brazil, Paraguay and Uruguay. The Parliament also tightened safeguard activation conditions by lowering import increase thresholds and significantly shortening investigation timelines, enabling faster intervention in cases of market disruption. In addition, it introduced a reciprocity mechanism requiring the Commission to act where credible evidence shows that imports benefiting from tariff preferences do not comply with equivalent EU standards in areas such as environmental protection, animal welfare, food safety or labour conditions. This broadens the legal basis for safeguards beyond purely quantitative market effects.

Finally, on 18 December, Parliament and Council negotiators reached an informal agreement on the main parameters of the safeguard legislation. The provisional compromise clarifies the definition of serious injury, strengthens import- and price-based monitoring thresholds, improves data exchange between Member States and the Commission, and reinforces continuous market surveillance. Although still subject to formal adoption, this agreement aims to significantly increase legal certainty regarding the operation of safeguards once tariff concessions take effect.

However, at the beginning of 2026, the latest Council’s decision, which kept the option of provisional application open, once again fuelled scepticism, as it could be used if Parliament delays ratification by requesting a legal opinion from the Court of Justice of the European Union.

In this context, also Commission officials intervened and tried to reassure the lawmakers that there is no intention to circumvent Parliament and that provisional application would not automatically follow the signature in Paraguay, especially given that the Mercosur countries would also require time to ratify the agreement.

In this particularly tense political and interinstitutional climate, attention is currently focused on the European Parliament, to see whether it will decide to refer the matter to the Court, and, if so, on the Council, to assess whether it will actually make use of the option of provisional application.

The position of the Member States and Industries

Positions among EU member states and economic actors remain sharply divided, largely along sectoral and national lines.

Export-oriented industries across manufacturing, chemicals, automotive components, and agri-food processing broadly support the agreement. For these sectors, the EU–Mercosur deal delivers tangible commercial gains by eliminating high tariffs on EU exports (duties that currently reach up to 35% on products such as car parts and alcoholic beverages) and by reducing non-tariff barriers in a fast-growing South American market. From this perspective, the agreement strengthens EU competitiveness and reinforces supply-chain diversification at a time of global economic fragmentation.

On the other hand, opposition remains strong among agricultural producers and several member states with politically influential farming sectors. France has emerged as the most vocal critic, joined by Italy, Ireland, Poland, Austria and Hungary, all of which have raised concerns about the impact of duty-free quotas granted to Argentina and Brazil for beef, poultry and other sensitive products, like rice and sugar. While Mercosur governments argue that these quotas are limited and commercially modest, many European farmers fear being undercut by imports produced with different rules on animal-welfare and environmental standards. These concerns are heightened by the perception that EU farmers face rising compliance costs linked to pesticide restrictions, animal welfare rules and climate policies.

Nonetheless, some experts pointed out that while European farmers failed to block the EU–Mercosur trade agreement, they ultimately emerged politically stronger. The deal moved forward only after Brussels introduced extensive safeguards and tighter import controls. For example, the EU can suspend tariff-free imports if market disruption occurs. The Commission has also pledged enhanced border controls and new rules to prevent the import of products treated with pesticides banned in the EU. It is also important to consider the large budgetary concessions made to the agriculture industry. In the EU's upcoming long-term budget, the Commission announced a €45 billion budget manoeuvre that would enable Member States to allocate greater funds to farmers. Yet, these assurances have not fully softened opposition from farming unions or from green and left-wing political groups, which continue to warn that the agreement risks accelerating deforestation, both in EU and South America, undermining indigenous rights, and weakening environmental protections.

What to expect

In the immediate term, attention will focus on three closely connected institutional milestones.

First, the signature of the agreement in Paraguay. Second, the spotlight will shift to the European Parliament, whose consent is required to move forward the final approval. It also remains to be seen whether the European Parliament will seek a legal opinion from the Court of Justice, a move that could delay the agreement’s ratification by several months. Third, debate will intensify around the sequencing of implementation, particularly the possibility of provisional application of the trade provisions while waiting for full ratification of the broader Partnership Agreement. 

Taken together, these steps suggest that while EU–Mercosur has decisively moved beyond diplomatic stagnation, its future now lays less on negotiation and more on domestic politics and legal strategies.

 

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GA-Alliance, a prominent international law and tax firm with a robust network spanning over 80 jurisdictions, is proud to announce a strategic partnership with Bejan & Associates, a leading law firm in Moldova. This collaboration significantly strengthens GA-Alliance's geographical reach, increasing its European footprint.

Led by Ms. Viorica Bejan, Bejan & Associates is a key player in the Moldovan legal market. The firm boasts a deeply experienced team that serves a diverse customer base, including private clients, SMEs, startups, large local and international companies, public bodies, and NGOs. Bejan & Associates brings extensive expertise across a wide array of legal fields, such as corporate law, administrative law, contract law, banking and financial law, anti-money laundering compliance, data protection, artificial intelligence, real estate, public procurement, intellectual property, M&A, as well as litigation and mediation.

GA-Alliance developed its initial understanding of the Moldovan market through its Brussels office by conducting a comprehensive compliance assessment on behalf of the European Commission. This assessment focused on evaluating the alignment of the Republic of Moldova’s civil aviation legislation with the EU acquis and represented a key milestone in the implementation of the Common Aviation Area Agreement (CAAA). As Moldova progresses on its path toward future EU accession, this exercise provided GA-Alliance with critical insights into the country's regulatory and market environment. It also laid a solid foundation for continued collaboration and strategic engagement in the region.

Francesco Sciaudone, Managing Partner of GA-Alliance, commented on the expansion: " GA-Alliance is committed to developing an extensive network to serve our clients wherever they need assistance. We are incredibly pleased to announce the expansion of our footprint into Moldova. With Viorica and her team, we aim to provide a full-service offering for the Moldovan market, seamlessly combining local expertise with a strategic global vision. This approach will be invaluable in supporting both domestic companies and the growing number of international players investing in the country."

This strategic alliance underscores GA-Alliance's dedication to providing comprehensive legal and tax services globally, leveraging strong local partnerships to deliver unparalleled value to clients.

GA-Alliance Launches Cybersecurity and Digital Compliance Practice and Welcomes Salvatore Figliuolo as New PartnerGA-Alliance, the leading law firm renowned for its innovative and client-centric global legal services, is pleased to announce the establishment of a new Cybersecurity and Digital Compliance Desk. This strategic initiative - designed to support public and private clients, both domestically and internationally, in preventing digital risks, managing data, and ensuring compliance with Italian and international regulations - underscores GA's relentless commitment to providing outstanding and thorough legal support to help businesses navigate the raising challenges of the digital era.

The new practice will be led by Mr. Salvatore Figliuolo, an experienced lawyer who will join GA as a new partner. Mr. Figliuolo has gained extensive exposure to technology law and cybersecurity, both in Italy and abroad, coupled with significant managerial roles in Generative AI companies.

GA realizes the importance of moving from a reactive assistance approach to a more proactive approach, aimed at strengthening clients' digital resilience. As a result, the new desk will offer joint legal and technical support, also thanks to the collaboration with Visibily, a managed security service provider (MSSP) company specialized in advanced enterprise solutions. This unique desk will provide integrated legal and technological services including:

Digital risk and vulnerability analysis; Review and set up of internal policies and data management protocols; Training and staff awareness on security and privacy issues; Ongoing assistance during inspections, data breach situations, and digitalization projects; Management of relationships with authorities (e.g., Police, Data Protection, Cybersecurity, European Authorities).

With this new initiative, GA-Alliance reaffirms its commitment to supporting clients through their digital evolution with a practical, multidisciplinary, and prevention-oriented approach. The team will also leverage the existing expertise within the law firm, particularly in privacy and administrative law.

Francesco Sciaudone, Managing Partner of GA-Alliance, commented: "The arrival of Salvatore Figliuolo and the launch of the Cybersecurity and Digital Compliance desk represent a natural evolution in GA's growth toward a more and more sophisticated professional services market. In an environment where companies are increasingly exposed to digital risks, and to evolving complex regulations, we believe essential being able to offer clients a comprehensive and integrated support – both domestically and internationally – combining legal expertise with technological solutions. The cooperation with a sophisticated technical partner and the synergies among our internal desks further strengthen our ability to support promptly, concretely, and strategically our clients in facing these new digital challenges."

The legal profession is becoming increasingly international, and Italy is no exception. The growth and presence of international law firms in our country is proof of that. GA-Alliance represents a unique and multifaceted reality, deeply rooted in the local territory with 14 offices in Italy, as well as in Brussels, London, Paris, Lugano, and New York. This approach enables partnerships around the world in line with shared working methods and remuneration standards.

An integrated network, a form of “global alliance” that allows operations in over 100 jurisdictions globally, involving around 2,600 affiliated professionals."Through the Alliance, we manage over 200 new cross-border operations every month. GA-Alliance is a global law firm with deep European roots, combining a strong legal tradition with an extensive international presence," explains Francesco Sciaudone, Global Managing Partner."Founded on principles of excellence, integrity, and innovation, we deliver legal services that integrate local expertise with a global perspective. From 2023 to 2025, our presence nearly doubled, growing from 58 to 112 countries—a remarkable 93% increase that strengthens our positioning as a leading international legal network."

GA-Alliance is also deeply rooted in Italy, where it has opened 5 new offices since 2024, continuing its expansion at the national level.“These are strategic steps,” Sciaudone adds, “in line with our growth vision, aimed at providing increasingly specialized and widespread legal and tax support in the main economic hubs. Our team includes a wide range of legal experts, such as former judges, distinguished university professors, prominent members of the Superior Council of the Judiciary School, and leading professionals in the financial and industrial sectors.”

GA-Alliance's hybrid nature is further confirmed by being the only Italian law firm nominated as a finalist at the prestigious The Lawyer European Awards 2024, in both the Italy and Global Network categories.

While Europe remains the operational base—with a presence in over 25 jurisdictions on the continent—the international network continues to expand in the Asia-Pacific (APAC) region, offering top-tier legal support in key markets such as Armenia, China, Hong Kong, India, Indonesia, Malaysia, Thailand, and Uzbekistan.“The Middle East is also becoming increasingly important for us,” says the Managing Partner. “We are in the process of obtaining a direct license to operate in the UAE, in Dubai. We are also present in South and Central America, operating in 17 countries where we position ourselves as a trusted legal partner for companies and investors navigating one of the world’s most dynamic and fast-evolving regions. Our expertise spans key sectors such as energy, infrastructure, corporate transactions, and real estate.”

The international law firm represents a hybrid model that is becoming a reference point: with 14 offices across Italy, it operates in 100 jurisdictions worldwide, thanks to a team of 2,600 professionals. Africa is the continent of the future.by ISIDORO TROVATOView more on "Il Corriere della Sera"

The Commission has launched a 4-week call for evidence related to the investment needs of the nuclear power sector in the EU. Seen as an important part of the consultative process and an opportunity for input from stakeholders and the public, the feedback received through this exercise will feed into the Commission’s work in preparing the update of the Nuclear Illustrative Programme (PINC), which is foreseen for publication before the end of 2025. The period to provide feedback is opened until 12 May.

The key objective of the PINC update will be to provide an up-to-date comprehensive, fact-based overview of nuclear energy investments across the EU in line with decarbonisation targets and the REPowerEU and Clean Industrial Deal goals. By covering the full lifecycle of nuclear installations, the programme will identify investment trends, needs, and challenges in the sector, based on objectives pursued by EU countries.

PINC also seeks to stimulate action by stakeholders and facilitate coordinated development of their investments in nuclear energy. In particular, the updated PINC aims to

clarify relevant investment needs for both new-build projects and lifetime extensions of existing reactors identify development and investment needs essential for responsible spent fuel and radioactive waste management and for a robust supply chain provide an overview of innovative nuclear technologies (SMRs, fusion) currently under development in the EU and highlight opportunities and potential challenges associated with developing and deploying them highlight needs associated with key enablers in the nuclear sector, including: (i) national regulatory capacity; (ii) transparency and public engagement; (iii) skills/ workforce gaps; and (iv) international collaboration

The proposed initiative will also seek to document and analyse several key challenges, including

the EU’s retention of its strategic leadership in the global nuclear sector vulnerabilities in the EU supply chain limited market uptake and slow commercialisation of innovative nuclear technologies access to financing  attracting new talent and retraining the existing workforce

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Simone Mori is the new Partner at GA-Alliance responsible for Strategic Advocacy. He will work – at national, European, and international levels – with GA-Alliance’s teams to develop Strategic Advocacy activities, with a particular focus on the energy and infrastructure sectors. GA-Alliance – an international law and tax firm with 12 offices in Italy and direct offices in New York, Lugano, Brussels, London, and Paris, as well as a network of professionals operating in over 80 jurisdictions worldwide – led by Managing Partner Francesco Sciaudone, aims to continue its growth path by adding a highly experienced professional of recognized standing.

Simone Mori will lead Strategic Advocacy efforts, coordinating a team capable of tackling the ongoing challenges posed by the increasingly complex geopolitical landscape and international dynamics, especially in sectors such as energy and infrastructure.

Simone teaches Economics and Energy Management at LUISS University in Rome and has over 30 years of experience in the energy and infrastructure sector, having held senior roles in leading energy companies. He has led activities in Russia, Romania, Slovakia, and Greece, and was globally responsible for regulatory, antitrust, environmental, and innovation policies. He also managed one of the world’s largest carbon credit portfolios. Over the years, he has contributed to the development of the electricity and gas sectors in more than 25 countries, gaining a unique understanding of energy market dynamics and policies in Europe and globally. In addition to strategic and regulatory advisory for businesses and financial institutions, Simone also supports innovative start-ups in the green tech sector. He collaborates with major think tanks such as Bruegel, the Centre on Regulation in Europe, the German Marshall Fund of the US, and the Observatoire Méditerranéen de l’Énergie.

“I’m truly convinced that with Simone on board, we will be able to offer an even more distinctive legal and strategic advisory service in the key sectors of energy and infrastructure, at national, European, and international levels. We want GA-Alliance to be increasingly seen as a strategic partner for our clients,” said Managing Partner Francesco Sciaudone.

GA-Alliance, an international law and tax firm with 12 offices in Italy and direct offices in New York, Lugano, Brussels, London and Paris, as well as a network of professionals spanning over 70 jurisdictions, led by Managing Partner Francesco Sciaudone (photo) is expanding its presence in Asia, with the opening of a new office in Uzbekistan is collaboration with Abacus Law.

Abacus Law is one of the leading law firms in Uzbekistan, with a strong tradition in both local and international legal matters. The firm is currently led by a team of highly experienced professionals with a strong track record across various practice areas.

Strategically positioned along Eurasian trade routes, Uzbekistan is emerging as a key investment hub, driven by targeted economic reforms, annual GDP growth exceeding 5%, and increasing openness to foreign investors. This new alliance presents a significant opportunity to expand business in sectors such as energy, infrastructure, and international trade.

"With this partnership, GA-Alliance reaffirms its commitment to providing top-tier legal services in the world’s most dynamic markets. Uzbekistan is a strategic area for international investors, and we are proud to operate in this country through our collaboration with Abacus Law," said Francesco Sciaudone, Managing Partner of GA-Alliance.

We are pleased to announce that GA-Alliance has been included in the Energy & Infrastructure 2025 – Italy & Latam Directory, published by Legalcommunity.

This recognition underscores our firm’s established expertise in a strategic and constantly evolving sector, with notable rankings in the following practice areas:

M&A – Highly Recommended (Francesco Sciacudone – Highly Recommended, Adriano Pala – Recommended) Administrative & Environmental – Excellent (Francesco Sciaudone – Elite) Litigation – Highly Recommended Regulatory Antitrust – Elite (Andrea Neri – Excellent, Francesco Sciaudone – Elite) Energy Efficiency – Excellent (Francesco Sciaudone – Excellent) Renewables – Highly Recommended (Francesco Sciaudone – Highly Recommended) Utilities – Elite (Francesco Sciaudone – Elite)

We extend our gratitude to Legalcommunity for this important acknowledgment and congratulate all our professionals for their continued commitment to providing high-level legal counsel to our clients.

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SALC Law firm in Stockholm, Sweden, a member of the GA-Alliance, acting through lawyers Dan Engström and Elin Nilsson, have successfully represented the Republic of Moldova in an Investor-State dispute.

On February 14, 2025, the Svea Court of Appeal in Stockholm, (Sweden), rejected the application filed by Komaksavia Airport Invest Ltd (“Komaksavia”) against the Republic of Moldova regarding the set-aside of an arbitral award of August 3, 2022, issued by an arbitral tribunal under the Rules of the SCC Arbitration Institute (previously the Arbitration Institute of the Stockholm Chamber of Commerce).The dispute began following Komaksavia's claims regarding its alleged investment in Avia Invest SRL, the – at that point in time -  concessionaire of Chisinau International Airport. In May 2020, Komaksavia initiated arbitration against the Republic of Moldova, claiming that the state had acted discriminatory and in breach of it’s undertakings under the BIT, interfered with Komaksavia’s alleged investment, which the Republic of Moldova contested. In August 2022, the arbitral tribunal found that Komaksavia had not made a protected investment under the bilateral investment treaty  (between the Republic of Cyprus and the Republic of Moldova) and dismissed Komaksavia’s claim on the basis of lack of jurisdiction.The losing party Komaksavia brought the matter to the Svea Court of Appeal for revision under the Swedish Arbitration Act, claiming that the award should be set-aside.

The Svea Court of Appeal however fully accepted the position of the Republic of Moldova, represented by SALC LAW FIRM,  and ordered Komaksavia to pay all the state's legal cost

The client, the Republic of Moldova, has expressed its great satisfaction over the representation and outcome of the matter. SALC is, of course, very satisfied with the outcome even if there is room, limited but still room, for the Swedish Supreme Court to grant leave to appeal.