The future of the EU-Mercosur free trade deal has been thrown into doubt by a European Parliament decision to refer the landmark deal to the courts, potentially holding up its ratification by two years.
European leaders will now have to consider whether the trade deal between the EU and four South American countries should come into force provisionally, before it has been approved by MEPs, a move that would prove incredibly contentious.
A sizeable majority of EU states backed the trade pact earlier this month, allowing it to be approved despite the objections of Ireland, France, Poland and others.
The trade deal required the approval of the European Parliament to be ratified, with a vote expected in April for May.
However, MEPs on Wednesday first voted to refer the trade agreement to the European Court of Justice (ECJ), to rule on whether it complies with EU treaties. The decision will put the ratification process on ice until a court ruling in at least a year and a half’s time.
The parliament’s decision to kick the deal to the EU courts for a ruling passed by a margin of 10 votes.
Fine Gael MEP Sean Kelly criticised the push to refer the trade agreement to the courts.
“I personally do not see any genuine legal reasons for such a referral. MEPs are elected by their constituents to take decisions, and the European Parliament has the power to consent to trade deals or not,” he said.
The latest rupture in transatlantic relations had given the vote in a Strasbourg parliament sitting a new geopolitical significance. Supporters of the trade agreement view the deal as crucial to Europe reducing its economic dependence on Washington, by opening up a big new South American market for trade.
The deal will lower tariffs and other barriers to trade between EU countries and Brazil, Argentina, Uruguay and Paraguay.
Farmers have fiercely opposed the trade agreement, fearing exports of Irish beef will suffer in the face of competition from cheaper South American steaks and burgers produced to lower standards.
The European Commission, the EU’s executive arm who negotiated the deal, point to safeguards to protect farmers.
The deal includes an emergency brake that the EU can pull to reimpose steep tariffs if South American beef is found to be flooding any part of the market and causing a drop in prices.
A significant delay in the deal coming into effect would increase the odds the Mercosur countries walk away from the table, scuppering the agreement at the last hurdle after 26 years of stop-start negotiations.
Ursula von der Leyen’s commission has the power to bring the trade agreement into force provisionally, before future sign off by MEPs.
Such a decision would draw fierce backlash from opponents of the deal, including farmers and environmentalists, political parties on the far-right and the far-left, and MEPs from France, Ireland and Poland.
The commission would likely only allow the deal to come into effect provisionally with the backing of national governments. One trade official in the commission said given the political sensitivities a decision would not be rushed.
Fianna Fáil MEP Billy Kelleher said the commission had chosen to “ignore” concerns about low quality beef entering the EU market and deforestation in the Amazon.
“The European Commission must reflect on its own actions, respect the democratic will of the Parliament and await the outcome from the European Court of Justice deliberations,” he said.
“Today is a good day, and hopefully will give momentum to the campaign to stop this rotten trade deal,” Sinn Féin’s MEP Lynn Boylan said.