The regional integration process in the South Cone started in 1985 with the Programme for Integration and Economic Cooperation (PICE) signed between Argentina and Brazil, and in 1988 with the adoption of the “integration of markets” models. In 1991, the project was extended to Uruguay and Paraguay and the four countries signed the Treaty of Asuncion launching the basis for the creation of the Common Market of the South, a project of regional integration involving economic, social and political dimensions including free movement of goods, services, people and factors of production among member states. It includes the establishment of a Common External Tariff and the adoption of a Common External Policy, the coordination of macro-economic policies as the harmonization of legislation necessary to strengthen the integration of the region.

In 1994, with the signature of the Treaty of Ouro Preto, the bloc gained an institutional structure with a legal personality of international law.  In 1998, the Protocol of Ushuaia endorsed the democratic compromise of all member states as of the associated states of Chile and Bolivia. A Permanent Tribunal of Mercosur was established in Asunción in 2004.  In 2005, a Structural Fund was agreed upon and scheduled for implementation in 2007 with programmes of development directed at the smaller nations of the bloc. During the Mercosur Summit in December 2004, leaders agreed to the establishment of the Parliament of Mercosur which had its first meeting in May 2007 in Montevideo, the siege city of the Mercosur Secretariat. Mercosur is currently in a stage of consolidation of its customs union.