European Union lawmakers have voted to hold up a major free trade agreement with the Mercosur group of South American countries over concerns about the legality of the deal.

According to the claim, the alleged move was a response to U.S. President Donald Trump saying he would impose tariffs on several EU member states.

U.S. customs authorities will face a real challenge if President Donald Trump goes through with his threat to place tariffs on six EU countries - rather than the whole European Union - given the ease of movement of goods between EU members.

The EU Parliament referred the EU Mercosur trade deal to Europe’s top court, freezing approval amid legal disputes.

EU countries have turned down the opportunity to take €74bn in recovery loans, as a struggle to spend cash and lower interest rate differentials have reduced the appeal of a post-Covid initiative to boost growth.

The European Parliament has formally put a hold on implementing the customs agreement between the US and the EU agreed last year, the trade committee chairman said on Wednesday following US threats of new tariffs amid the Greenland dispute.

This sweeping update introduces measures to identify and potentially exclude "high-risk" third countries and companies across 18 essential sectors.

The European Parliament voted to submit a landmark trade deal with South American countries for judicial review by the bloc’s top judges, risking further delays to the Mercosur pact, which has already been a quarter century in the making.

The European Union and the Mercosur bloc of South American countries formally signed a long-sought landmark free trade agreement on Saturday, capping more than a quarter-century of torturous negotiations to strengthen commercial ties in the face of rising protectionism and trade tensions around the world.

Wind and solar power produced more electricity than fossil fuels in the EU for the first time last year, data published on Thursday showed, indicating the bloc's continued shift towards low-carbon energy despite resistance from some governments.