EU officials say the free trade pact, which was initialled last October but needs the support of all EU member states, will generate about 19 billion euros ($24.11 billion) of new exports for EU producers and 12 billion euros in goods for South Korea.
Italy has raised concerns that the agreement could flood the European market with cars made in South Korea and hopes to delay it coming into force.
"Our Italian colleague expressed considerations that made it difficult at this time to join the rest of the member states in agreeing on the decision," EU Trade Commissioner Karel De Gucht told reporters after trade talks in Brussels.
"We are extremely close (to agreement) ... Hopefully we will be able to finalise it on Monday," he said, referring to a meeting of foreign and European affairs ministers next week.
He said he hoped that securing the backing of all EU states would allow the free trade pact to be signed at the latest by Oct. 6, when the EU and South Korea hold a summit.
The free trade agreement is the most important to be negotiated between the EU and a third country since a deadlock in the Doha round of world trade talks spurred bilateral trade negotiations.
The European Commission, the EU executive, had hoped the pact would enter into force this year but Italian officials said this week that Rome wanted to prevent it taking effect for a year rather than launching in 2011.
Adolfo Urso, Italy's deputy minister for economic development, said that Rome would be ready to accept wording that made clear the agreement should not take effect before June 30, 2011.
"The text has been significantly improved and includes most of the Italian requests. I am fairly satisfied by the text and I think today we did 80 percent of the work (towards securing agreement)," he told reporters in Brussels.
He made clear Italy had raised concerns about protection of its small car sector and the possible impact of trade deals between South Korea and non-EU countries.
Similar concerns for the U.S. car sector have slowed progress toward a U.S.-South Korea trade deal.
The European Parliament, whose approval is also needed for the free trade agreement, informally approved a provision on Tuesday that will allow Europe to close its borders to South Korean cars if a trade pact causes a surge of cheap car imports. (Reuters)
