The Association Agreement between the European Union and Mercosur was once again the focus of international trade debates after its conclusion in December 2024, following over 25 years of negotiations. The process involves the EU and the South American bloc comprising Argentina, Brazil, Paraguay, and Uruguay. Although there has been significant progress, the agreement has yet to enter into force, and it raises relevant questions for Chile in an increasingly demanding European market.
Chile sees this scenario from a different perspective. The Interim Trade Agreement between Chile and the EU, in force since February 2025, consolidates preferential access terms and a clear, predictable regulatory framework for agri-food trade. Chile has an annual tariff-free quota of 21,200 tons for pork and 32,200 tons for poultry.
This preferential access translates into stable penetration into the European market. In 2024, Chilean pork exports to the EU reached 16,900 tons, equivalent to approximately 5% of Chile’s total exports, with a consolidated presence in markets such as Germany, Spain, Greece, and the Netherlands. These figures reflect a stable position in a market characterized by high sanitary, regulatory, and trade standards.
The competitive landscape could see adjustments in specific segments, particularly the poultry sector. Brazil is already a significant supplier to the European market, with exports exceeding 230,000 tons in 2024. If the agreement with Mercosur moves forward and achieves similar sanitary standards, competition could intensify, especially in industrial and retail segments, with a potential impact on prices.
Hence, the challenge for Chile is not simply tariff access, but also maintaining and strengthening attributes valued by the European market, such as sanitary consistency, traceability, and regulatory compliance. Similarly, Mercosur’s primary challenge will be to consistently respond to the EU’s growing sanitary, environmental, and sustainability requirements in an increasingly competitive international environment.
Agreement status and European political context
On January 17th, the EU and Mercosur member countries signed the Association Agreement in Asunción, Paraguay, marking a significant milestone in a process that began over two decades ago. However, the agreement has not yet entered into force, and its implementation faces new challenges. The procedure requires approval by the European Parliament (EP), followed by the national parliaments of member states. Still, the EP temporarily suspended the process by submitting the text to the Court of Justice of the European Union (CJEU) to review its compatibility with the EU treaties. The review, which could take 18 to 24 months, means the EP will not proceed with the final vote until it hears the court’s opinion.
One of the aspects the EP asked the Court to assess is the “rebalancing mechanism,” which would allow Mercosur countries to challenge European regulations that hinder their exports. It raises concerns among some EP members, as it could challenge the EU’s regulatory autonomy and the competence framework established in the EU treaties.
Overall, the decision to refer the trade agreement to the CJEU introduces a new level of uncertainty about its implementation timelines and scope, shifting the debate from the political sphere to a legal-institutional dimension in a European context particularly sensitive to trade, environmental, and regulatory matters.
It also occurs in a context marked by intense pressure from European agricultural sectors, which oppose the potential entry of agri-food products from Mercosur. Agricultural heavy-hitters—such as France, Ireland, Poland, Austria, Belgium, and Italy—are leading this opposition, concerned about price competition, regulatory asymmetries, and environmental requirements, factors that continue to strain the internal political debate.
The trade pillar is the sector’s primary concern, as it defines the conditions for market access, sanitary and phytosanitary measures, and the regulatory frameworks that govern agri-food trade in an increasingly demanding European market, where supranational legal and regulatory bodies increasingly shape business decisions.
Market access: quotas and limited opening for meat
In reality, the agreement does not represent full liberalization of agri-food trade between the EU and Mercosur. In line with the EU’s Common Agricultural Policy, market access is structured through a highly regulated, progressive scheme based on tariff quotas for sensitive products, including meat.
Today, Mercosur countries export meat to the EU under the WTO’s most-favored-nation tariffs, with costly and restricted access that is limited by historical quotas. The agreement introduces some improvements without structurally altering the protected nature of the European agri-food market.
For pork, it establishes a common Mercosur quota of 25,000 tons as of the fifth year, with a tariff of $83 EUR per ton within the quota. It will be administered by the EU on a first-come, first-served basis, with no country allocations. For poultry, the FTA includes two zero-tariff quotas totaling 180,000 tons, effective in the fifth year. Despite their magnitude, these quotas represent around 1.3% of European production and consumption, indicating a limited structural impact.
Additionally, Brazil—Mercosur’s leading pork producer—has no plants approved for exports to the EU, as it is not on the listing of non-EU countries with authorized establishments. While the agreement does not automatically resolve this situation, it does include a chapter on sanitary and phytosanitary measures that could facilitate sanitary negotiations in the medium term.
Alongside volume, the agreement incorporates relevant disciplines on rules of origin, sanitary and phytosanitary measures, and technical barriers to trade, as well as a chapter on trade and sustainable development that is the focus of much of the political controversy in the EU. The implementation of the EU Deforestation Regulation has become central to the discussion, particularly because of its indirect impact on strategic inputs such as soy from Mercosur that is used for animal feed.
