Common External Tariff

Customs

The uniform tariff rate applied by all EU member states to goods from non-member countries.

Sources

1. World Trade Organization — Glossary: a guide to “WTO speak” wto.org accessed 23 September 2026

The common external tariff is what distinguishes a customs union from a free trade area, and the WTO glossary draws the line in two short sentences. Of a customs union: “Members apply a common external tariff (e.g. the European Union).” Of a free trade area: “Trade within the group is duty free but members set their own tariffs on imports from non-members (e.g. NAFTA).” The consequence is practical rather than doctrinal. Because free trade area members keep their own external tariffs, goods could otherwise enter through the lowest-tariff member and move on duty-free, which is why free trade areas need rules of origin and customs unions largely do not. A common external tariff also means external trade policy has to be decided jointly.

What a glossary settles, and what it does not. The WTO’s glossary is the organisation’s own plain-language guide to its vocabulary, so it is authoritative for what the term means in WTO usage. It is not the legal text. Where an obligation is at stake, the operative words are in the agreement the glossary points to — GATT, GATS, TRIPS and the rest — and those are what a panel would read. Use the glossary to know what is being discussed, and the agreement to know what is owed.

Related terms

• Advance Authorisation
• Anti-Dumping Duty
• ATA Carnet
• Authorised Economic Operator
• Bill of Entry
• Binding Tariff Information

From the AJG lexicon archive (July 2026).