So what is the European customs union and how does it affect Brexit? Here's everything you need to know.
What is the EU customs union?
The European customs union is an agreement between 28 member states to trade goods more easily.
Paperwork and goods checks are reduced when goods cross borders of these countries.
It is agreed that there is no tariff to be paid on goods traded within the EU.
Trade deals with countries outside of the EU are agreed upon collectively and tariffs on goods exchanged with these countries are the same for each EU member country.
What does Brexit mean for the UK's position in the customs union?
If the UK leaves the EU via a Soft Brexit we will still remain in both the single market and the customs union, avoiding disruption to trade.
A Hard Brexit meanwhile would involve the UK leaving the single market and customs union, with a loose trade agreement with the EU.
As a deal has not yet been decided upon, we may leave the EU with a backstop, the "insurance policy" in the withdrawal deal, designed to ensure there is no hard border between Northern Ireland and the Republic if a broader trade deal cannot be agreed.
A backstop would keep the UK in the customs union.
What are the benefits of being in the customs union?
Being a member of a customs union drastically reduces the amount of time it takes for goods to enter and leave the UK.
It also saves money on goods traded between the 28 EU member countries.
Leaving the customs union could disrupt trade, leaving the country without essential goods and potentially causing a loss of jobs.
What are the benefits of leaving the customs union?
The UK would be able to strike new trade deals with countries outside of the EU if it leaves the EU customs union.
It could also open new lines of trade, opening up new job opportunities.
How would leaving the customs union affect the Irish border?
It is pretty much impossible for the UK to leave the customs union without creating a hard border between Northern Ireland and the Republic of Ireland – otherwise this border could become a backdoor for trading.
What's the difference between the customs union and the single market?
The European Union's single market is a trade agreement between all EU member states which allows free movement of goods, services, capital and people from one EU member country to another.
This is why there is no limit on the number of EU migrants who can come to the UK or the number of Brits who can live in Spain, for example.
The single market also eliminates tariffs or taxes on trade and has loads of rules and regulations on packaging, safety and standards that apply across the area.
It encompasses the EU's 28 member states as well as the exceptions Iceland, Liechtenstein, Norway, and Switzerland.
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