What is the EU-Mercosur trade deal?
The EU-Mercosur free trade agreement will drastically cut existing tariffs and make it much easier for trade to flow between European Union countries and the South American bloc of Brazil, Argentina, Uruguay and Paraguay.
Supporters of the deal welcome the fact it will open up a huge new market for European and Irish industries to sell their products. Farmers fiercely oppose it, due to fears exports of Irish beef will suffer in the face of competition from cheaper South American products produced to lower standards.
What’s the latest?
So earlier this month a majority of EU states voted to approve the deal, clearing a key hurdle after 25 years of stop-start negotiations. Ireland, France and a small number of others opposed it but were outvoted in Brussels. A weighted majority was required to pass the agreement, rather than the unanimous support of all 27 EU states.
The trade agreement also needs to be signed off by a majority of MEPs in the European Parliament. That vote had been due to take place in April or May.
However, MEPs this week voted to refer the agreement to the European Court of Justice for a legal review. That decision pauses the ratification process in parliament until a court ruling comes back, something that could take up to two years.
What way did Irish MEPs vote?
Regina Doherty, Maria Walsh and Sean Kelly of Fine Gael, and Fianna Fáil MEP Barry Andrews voted against kicking the trade deal to the EU courts.
Independent MEP Luke ‘Ming’ Flanagan is recovering from a hospital operation and could not travel to Strasbourg for the vote.
The remaining Irish MEPs backed the legal referral; Nina Carberry (FG), Barry Cowen (FF), Billy Kelleher (FF), Cynthia Ní Mhurchú (FF), Michael McNamara (Ind), Ciaran Mullooly (Ind Ire), Aodhán Ó Ríordáin (Lab), Lynn Boylan (SF) and Kathleen Funchion (SF).
So the Mercosur deal is dead for the moment?
Not necessarily. It would be very controversial, but the European Commission, the EU’s executive arm led by Ursula von der Leyen, that leads the union’s trade policy, could allow the trade deal to come into effect provisionally. There would be fierce backlash to such a move from farming organisations and many MEPs.
The commission would only go for that option with the backing of most national governments.
By triggering a lengthy legal review, MEPs who oppose the deal may have ironically increased the chances it will be brought into effect provisionally, before the European Parliament votes to ratify the trade pact.
The recent fracturing of relations with Europe’s biggest trading partner, the United States, could embolden supporters of the deal – Germany, Spain, Denmark – to push the commission to press ahead. Von der Leyen will not rush into such a politically contentious decision quickly.