Customs Union
A trading area covering two or more countries which agree to abolish tariffs between them as well as restrictions on the amount of trade such as quotas, and have a common external tariff and other common trade controls in relation to third countries outside the customs union.
Notes
- Not to be confused with a free trade area - which has no common customs duties and no common trade policy.
- The EU is a customs union with a common commercial policy as an exclusive EU competence
- EFTA is a free trade area where member states can have different trade policies
- The EEA agreement and bilateral agreements with Switzerland have established a joint free trade zone internally between the EU and most EFTA countries
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