The main difference between a free trade area (FTA) and a customs union is that in a customs union, there is:

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A customs union requires its members to have a common external tariff with non-member countries, which means that they all apply the same import duties on goods coming from outside the union. In contrast, a free trade area removes tariffs and quotas between its members, but each member is free to set its own external tariffs. Therefore, the main difference between an FTA and a customs union is the presence or absence of a common external tariff. The other options (A, B, and C) are not necessarily features of a customs union as they depend on the specific agreement between the member countries. For instance, a customs union may or may not require passport controls, border patrol, or a shared currency.

The Main Difference Between a Free Trade Area (FTA) and a Customs