EU–Mercosur deal runs into fresh trouble as Parliament turns to top court

The EU–Mercosur trade deal has hit a new political and legal obstacle after the European Parliament voted to seek an opinion from the Court of Justice of the European Union on whether the agreement’s planned legal structure complies with the EU Treaties.

In a razor-thin 334–324 vote on 21 January 2026, MEPs backed a request for judicial scrutiny of the deal’s legal design and implementation framework, effectively slowing the ratification process. Parliament has made clear it does not want to move forward with approval before the Court delivers its view.

The move does not kill the agreement, but it opens a new front in an already contentious battle over one of the EU’s most politically sensitive trade packages. It also raises the prospect of an institutional clash if the European Commission chooses to press ahead with provisional application of the trade pillar before Parliament is ready to proceed.

Parliament delays, Commission keeps options open

The Parliament’s decision does not prevent the Commission, after consulting member states, from moving toward provisional implementation of the trade-related parts of the agreement. According to the Associated Press, the Commission has indicated that it is prepared to lay the groundwork for interim application, while the Council has also argued that the Commission has the authority to provisionally apply the agreement.

That possibility is likely to sharpen tensions between the EU institutions. Critics of the deal argue that any attempt to activate its trade provisions before the legal and political objections are settled would amount to forcing through a deeply divisive agreement by procedural means.

A deal signed, but far from secured

The latest dispute comes only days after the Council of the European Union adopted, on 9 January 2026, the decisions authorising the signature of the EU–Mercosur Partnership Agreement and the related Interim Trade Agreement. The EU and the Mercosur bloc — Argentina, Brazil, Paraguay and Uruguay — then signed the package in Asunción on 17 January.

The structure of the package is central to the current controversy. Rather than advancing as a single instrument, the agreement separates the broader partnership framework from the trade provisions, placing them into distinct legal texts. It is precisely this legal architecture that Parliament now wants the Court to examine.

According to Reuters, an EU diplomat said on 22 January that the trade provisions could enter into provisional effect as early as March 2026, provided the corresponding ratification step is completed on the Mercosur side as well.

Economic promise, political backlash

Public EU briefings have presented the agreement as a strategic effort to modernise trade and cooperation between the two regions. Based on an AP summary, the package would gradually eliminate more than 90% of tariffs and create a free-trade area covering roughly 700 million consumers.

But the economic case for the deal has long been overshadowed by political resistance, especially in agricultural sectors across Europe. Reuters and AP report that the core concern among several member states and farming groups is that the agreement would increase imports of lower-cost South American agricultural products — including beef, sugar and poultry — and put additional pressure on EU producers already facing high costs and regulatory burdens.

In several places, protests accompanied the parliamentary vote, underlining the degree to which the agreement has become a flashpoint well beyond Brussels.

Hungary rejects the deal — and so does the main opposition

Hungary remains firmly opposed to the free-trade agreement. The government has said it will not support the package and has stated that as long as a “national government” remains in power, Hungary will not allow the agreement to enter into force.

Notably, opposition to the deal in Hungary is no longer confined to the government side. The country’s largest opposition force, the Tisza Party, also rejects the agreement. Its MEPs voted in favour of the parliamentary resolution calling on the Court of Justice to assess whether the deal’s legal structure is compatible with the EU Treaties.

In a podcast interview with Válasz Online the day after protests surrounding the resolution, the party’s leader said protecting Hungarian agriculture is a “key issue” in relation to the free-trade package. He also warned that it would be risky if the Commission tried to bring the agreement into effect early by circumventing Parliament’s intervention.

The real battle starts now

The Parliament’s vote does not bury the EU–Mercosur agreement, but it makes clear that the ratification fight is entering a more volatile phase. What had already been a politically contested trade pact is now becoming a test of institutional power inside the EU: how far the Commission is willing to go, how strongly Parliament wants to assert its role, and whether the Court will validate the legal route chosen for the deal.

For supporters, the agreement remains a landmark geopolitical and commercial opening between Europe and South America. For its opponents, it is a threat to domestic agriculture dressed up as strategic trade policy.