Which grouping imposes a common external tariff on imports from non-member states and requires member states to enforce the same trade barriers?

Which grouping imposes a common external tariff on imports from non-member states and requires member states to enforce the same trade barriers?

• A. Free Trade Area
• B. Economic Union
• C. Customs Union
• D. Common Market

Answer: (C)

A customs union is defined by its shared external tariff and the obligation for member states to enforce the same trade barriers. In this arrangement, member countries remove tariffs on goods traded among themselves, but adopt a single, common external tariff for imports from outside the bloc. That uniformity ensures non-members face one tariff rate, applied consistently across all member states. Free Trade Area lacks a unified external tariff, as each country keeps its own external barriers. Economic Union and Common Market entail deeper integration, including policy coordination and movement of factors of production, but the concrete feature described—the common external tariff—points to a customs union.

A customs union is defined by its shared external tariff and the obligation for member states to enforce the same trade barriers. In this arrangement, member countries remove tariffs on goods traded among themselves, but adopt a single, common external tariff for imports from outside the bloc. That uniformity ensures non-members face one tariff rate, applied consistently across all member states.

Free Trade Area lacks a unified external tariff, as each country keeps its own external barriers. Economic Union and Common Market entail deeper integration, including policy coordination and movement of factors of production, but the concrete feature described—the common external tariff—points to a customs union.