The Community Customs Union, now referred to as the European Union Customs Union (EUCU), is a customs union that includes all of the European Union (EU) members. It also includes Monaco and the British Overseas Territories of Akrotiri and Dhekelia. Due to their geographic distance from the other EU member states, several detached territories of the region do not take part in the customs union. Through separate bilateral agreements, the EU also has customs agreement with Andorra, San Marino, and Turkey in addition to the EUCU. The CU’s members set a common external tariff on all goods entering its territory, unlike a free-trade area, yet there are no tariffs or non-tariff barriers to trade among them. Instead of individual member states negotiating foreign trade treaties, the European Commission does so. In addition, it represents the members before the World Trade Organization and mediates any trade disputes that arise.
Harmonized external tariffs
The tariff rates for imports into the region from foreign nations are established by the EUCU. These rates are particular, dependent on the type of imported goods, and subject to seasonal variations. Only those without a free trade agreement with the EU or those not participating in a WTO-recognized exemption program like Everything But Arms are subject to the full Most Favoured Nation tariff rates.
Union and common transit
Union transit is a method that is commonly used to move both Union and non-Union commodities that must pass through the territory of a third country between their points of origin and destinations in the region and for which customs duties and other import-related fees have not been paid. For the transportation of products between the EU Member States, the EFTA nations, Turkey, the Republic of North Macedonia, and Serbia, the common transit method is utilized. The operation of the common transit procedure with the UK is ensured as the UK deposited its instrument of accession on 30 January 2019 with the Secretariat of the Council of the EU. The procedure is based on the Convention on a common transit procedure of 20 May 1987. Effectively, the rules are identical to those of Union transport.
Code of Union Customs
On May 1, 2016, the Union Customs Code (UCC), which aimed to modernize customs procedures, went into effect. The implementation date was December 31, 2020. The UCC’s objectives, according to the European Commission, are speed, service, and simplicity.
Non-EU Participants
Monaco and the British Overseas Territories of Akrotiri and Dhekelia are essential components of the customs territory of the EU.
Opt-out zones in the EU
The CU includes all of the EU’s member states, but not all of their separate territories. The CU often does not include regions of member states that have stayed outside of it (EU overseas territories). However, due to financial and/or geographic considerations, some EU member states choose not to join the CU. They include Heligoland, Livigno, Ceuta, and Melilla, as well as Büsingen am Hochrhein.
Opt-outs in the past
Up till the end of 2019, the following regions were not included: Italian Lake Lugano waters and Campione d’Italia
Special agreements relating to British overseas territories
After leaving the EU on January 31, 2020, the United Kingdom of Great Britain and Northern Ireland’s transitional arrangements concluded on December 31, 2020. The areas of the United Kingdom and its territories that border an EU member state on land have special arrangements in place.
Northern Ireland
The EU-UK Trade and Cooperation Agreement, the European Union (Future Relationship) Act 2020, and the United Kingdom Internal Market Act 2020 now govern Northern Ireland’s trade with Great Britain and the European Union. Northern Ireland is no longer a part of the European Union Customs Union. While Northern Ireland is still a part of UK Customs territory, there are specific rules for trade in products between Northern Ireland and the EU. These are comparable to those that are in place within the Customs Union.
Gibraltar
Along with the UK, Gibraltar also quit the EU. It was not a member of the Customs Union when it was a member of the EU and was one of the EU territories having opt-outs. The EU, the UK, and Gibraltar have achieved an understanding in principle to write a treaty including provisions for trade in products between the EU and Gibraltar. These would largely resemble those found in the Customs Union. The arrangement has not yet been completed as of July 2021.
