Brexit negotiations: what is a Customs Union?

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In the the whole brouhaha of the British referendum campaign regarding exiting the European Union, back in 2016, it’s difficult to remember any campaigner ever discussing the customs union and what leaving that might mean.

So minimal was that debate about that exact aspect of Brexit back then, it’s notable that the specific issue has since become very keen. But what exactly is a customs union and what does it mean for marketplace sellers?

The customs union is a key aspect of the EU that means the various member states are able to trade freely with each other and collectively they have all agreed to charge the same tariff on imports from outside of the bloc.

Countries importing goods into the EU pay the same tariff regardless of which member states they are importing to. And importantly, members of the customs union cannot negotiate their own trade deals elsewhere in the world, as they are tied to the tariff arrangements of the EU. It’s not quite the same as the single market, but it’s clearly a key aspect of it.

The issue has come to the fore this week because the leader of the Labour party and, leader of the opposition, Jeremy Corbyn has signalled that his party will support remaining in a customs union post-Brexit. That’s significant because Theresa May’s Conservative government has a wafer thin hold on a parliamentary majority. It wouldn’t take many Tory rebels to vote with Labour to defeat it and back a Labour push to remain in the customs union.

Labour would seek a final deal that gives full access to European markets and maintains the benefits of the single market and the customs union. We have long argued that a customs union is a viable option for the final deal. So Labour would seek to negotiate a new comprehensive UK-EU customs union to ensure that there are no tariffs with Europe and to help avoid any need for a hard border in Northern Ireland.
– Jeremy Corbyn, Labour leader

We shall see what happens. But, of all the issues related to Brexit, that are of real importance to ecommerce merchants, the future of the single market and the free movement of good is the most important. With one year and one month to go until the 2 years expire since Article 50 was triggered, it just goes to show how little we still know about the exact terms of Brexit and how it will impact business.

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