Mutual recognition may seem to be an attractive option to tackle regulatory divergences across jurisdictions, as, in comparison to harmonization, it allows the parties to preserve their domestic regulations. However, in reality, it might be difficult to achieve and is a subject to certain conditions and limitations. This article investigates the notion of mutual recognition and outlines its limits in the EU free trade agenda aiming to answer the question in which form mutual recognition may be applied within the framework of an FTA.