GlossaryEN1 min readUpdated: Jun 26, 2026
Customs Union
A customs union is a trade agreement under which member states abolish tariffs on goods traded among themselves and apply a single common external tariff to imports from third countries.
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Source: https://ec.europa.eu/taxation_customs/business/calculation-customs-dystems/customs-union_en
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Passar Hub: Everything on the new Swiss customs system
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Definition & Explanation
A customs union is a trade agreement under which member states abolish tariffs on goods traded among themselves and apply a single common external tariff to imports from third countries. Within the union, freight forwarders and importers move goods across internal borders without customs declarations or duty payments. The key distinction from a free trade area is that common external tariff: free trade area members each set their own external duties and must apply rules of origin to prevent trade deflection, whereas a customs union pools that authority entirely. The EU Customs Union and MERCOSUR are prominent examples. For logistics operations within a customs union, intra-bloc shipments involve far less documentary burden than cross-border trade with non-member countries.
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Passar Hub: Everything on the new Swiss customs system
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