Australia and the European Union have agreed on the scope of a future free trade deal.
EU Trade Commissioner Cecilia Malmstrom and Australian Trade Minister Steve Ciobo spoke on the phone on Thursday.
Ms Malmstrom says she will seek a mandate from EU member states to launch formal negotiations.
"This is a key step toward the launch of negotiations," Mr Ciobo said.
"We're creating new export opportunities for Australian businesses because more exports means more jobs."
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The EU is Australia's second largest trading partner and largest source of foreign investment.
In 2015-16, two-way trade was worth $95.6 billion and total investment stock from the EU was almost $1 trillion.
