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What is the customs union?

The UK border.Image source, PA
Image caption,

The customs union is an agreement between EU countries about how goods are bought and sold across borders into the EU

The customs union is an arrangement between European Union (EU) countries which means that they do not have to pay taxes, called tariffs, to move goods and services between their countries.

This makes it easier for customs union countries to buy and sell products between each other, by keeping costs down and avoiding delays.

All members of the EU are automatically members (and so is Monaco).

It is different to something called the single market, which you may have heard being talked about too. Click here to find out more about the single market.

Why do some people like the customs union?

The customs union has an advantage for businesses which need to move things between countries a lot, like for businesses which import and export

It reduces the amount of money these businesses need to pay and the amount of paperwork they need to do.

The members of the customs union also charge non-EU countries the same tariff to bring their goods into the EU. This is called a common external tariff.

For example, if you bring steel into the EU from a non-EU country, you pay the same tariff whether you are bringing it to Germany or to the UK, because everyone is part of the same system.

The idea is that, for the EU, having 28 countries and so many people as part of their club makes them able to strike good deals.

Image source, AFP/Getty Images
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Products arriving from outside the EU are all charged the same tax to be imported into an EU country, regardless of which EU country they arrive in

Why do some people not like the customs union?

Some people don't like the idea of being in the customs union because the union's rules are set by the EU, so each individual country may not have as much control as it might like.

Individual countries in the EU customs union can't negotiate trade deals with other countries around the world.

Deals are done as a group - and what is agreed for one EU country, is agreed for all.

For some people, the whole idea of Brexit is to free the UK from rules and to make deals with any countries it wants to.

Image source, Getty Images
Image caption,

The yellow countries are members of the European Union

Why are we talking about the customs union?

We are talking about the customs union because Labour leader Jeremy Corbyn has said he is "very happy" to meet Prime Minister Theresa May to see if they can come up with what to do next with Brexit, but he wants to ensure that plans for the UK to be part of a customs union with the EU are on the table.

But Mrs May's Conservative Party pledged as part of Brexit that Britain would leave the EU's customs union.

Labour wants the UK to have its own customs union arrangement with the EU.

Turkey currently has this, although it doesn't include farming goods.

Labour says that the UK would be able to organise a better deal than Turkey's current arrangement because the UK is a bigger economy. Andorra and San Marino are also example of countries which also have their own separate customs union arrangements with the EU.

Image source, AFP/Getty Images
Image caption,

Prime Minister Theresa May has said that she will hold talks with the leader of the Labour party (her party's main rivals) to try to work out what to do next with Brexit, but Mr Corbyn has said he wants the customs union to be discussed

But others worry that arranging any sort of customs union could see the UK unable to do its own Free Trade Deals after Brexit.

The customs union prevents EU countries from making their own free trade agreements with other non-EU countries.

But the UK government says it wants to be able to agree its own trade deals with non-EU countries after Brexit in order to "take back control", which it says is what the people of the UK want.

Some customs union supporters argue that the more the UK sets up its own trade deals with other countries, the more barriers it could put up for trading with the EU - which could be bad for UK businesses as many British products are sold to the EU.

Why is the customs union such a complicated issue?

One of the main issues when it comes to discussing the customs union is the border between Ireland (which is staying in the EU) and Northern Ireland (which, along with the rest of the UK, is due to leave the EU).

After Brexit has happened, both the UK and the EU want the border to remain as it currently is - basically invisible.

But if the UK is no longer in a customs union, there will have to be checks at the border to monitor goods as they come and go, which means the physical bits of the border may have to return.

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Watch: What is happening on the Northern Ireland border?

There have been talks about moving the checks so they just take place when goods come onto the larger island of England, Wales and Scotland so that the Irish border can remain more open.

But some Northern Irish politicians have been critical of this as it would mean Northern Ireland being treated differently to the rest of the UK after Brexit, which they do not want to happen.

Even if the UK remained in the customs union as it is now, it would not automatically be part of the single market, so it would not solve the border problem.

There would still need to be checks to make sure that goods complied with EU rules and regulations, and to check people moving between countries.

Whether or not the UK will enter a customs arrangement with the EU remains to be seen.