During a major vote this week, MEPs voted by a margin of 355-247 to reserve product terms such as "burger" and "sausage" solely for meat products.
Should the measure becomes law, common plant-based items like veggie burgers, soy steak, and cauliflower schnitzel could have to change their names throughout EU markets.
However, for the ban to take effect, it must receive support from a majority of the 27 EU countries, which remains uncertain.
Supporters contend that consumers require transparent labeling and while traditional names must exclusively describe products derived from livestock.
"A steak and sausages are products from our livestock: not from laboratory art or plant products," said France's MEP the proposal's author.
Critics, led by Green MEPs, described the decision unnecessary regulation.
"Veggie burgers, seitan schnitzel and soy sausage do not confuse shoppers, just certain lawmakers," said Austrian lawmaker Thomas Waitz.
The marks another effort to control these terminology. The European parliament voted down a comparable ban in 2020.
France earlier enacted a national restriction on traditional names for plant-based foods in 2020, but the European court of justice determined it illegal under EU law in this year.
Leading German retailers such as Aldi and Lidl oppose the proposal, warning that altering familiar terms would mislead shoppers.
Advocacy organizations point to research showing that most shoppers understand these names when items are clearly marked as vegan.
"Almost 70% of consumers understand the terminology provided products are explicitly marked vegan or vegetarian," said Irina Popescu, a consumer officer at BEUC.
The proposal next faces review by European governments, and it must obtain majority support to be enacted.
Given the mixed opinions among various politicians and the general population, the future of this initiative is still unclear.