The Customs Union – an island under construction?

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 by Andreia Barbosa, PhD student at the Law School of UMinho

“No country is an island”[i]. It is an idea that is entirely valid in the context of the European Union and is particularly relevant in the area of ​​the Customs Union. Although the European Union represents only 6.9% of the world’s population, the volume of trade with the rest of the world corresponds to approximately 20% of the volume of world exports and imports[ii].

In fact, and in order to meet the characteristics that have been identified as necessary for a perfect Customs Union, there can be no frontiers among the Member States, although their territories may be separated by sea.

In particular, in the field of the European Union, the levying of customs duties between Member States no longer makes sense in view of the establishment of the internal market. Thus, the 1957 Treaty of Rome prohibited customs duties and charges having equivalent effect in trade between Member States. A Customs Union emerged, where national borders were replaced by the limits of the customs territory of the Union.

It happens that the Customs Union is not – and cannot be – an island. Commercial contact with the rest of the world is essential for the very survival of the Member States, making it reasonable that trade with third countries is sometimes facilitated, in approximate terms to those that exist internally. Free trade agreements are particularly important in this area.
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