A customs union is generally defined as a type of trade bloc which is composed of a free trade area with a common external tariff.
Customs unions are established through trade pacts where the participant countries set up common external trade policy (in some cases they use different import quotas). Common competition policy is also helpful to avoid competition deficiency.
The Zollverein (German: [ˈtsɔlfɛɐ̯ˌʔaɪn]), or German Customs Union, was a coalition of German states formed to manage tariffs and economic policies within their territories. Organized by the 1833 Zollverein treaties, it formally started on 1 January 1834. However, its foundations had been in development from 1818 with the creation of a variety of custom unions among the German states. By 1866, the Zollverein included most of the German states. The Zollverein was not part of the German Confederation (1815-1866).
The foundation of the Zollverein was the first instance in history in which independent states consummated a full economic union without the simultaneous creation of a political federation or union.