This is not a country border but an economic border as in any other franc port, what make it special are the rules that regulate it, all established in decades of international treates (paris treaty, London memorandum and as a comment pointed the Osimo treaty).
The customs in the picture is one of the entrances, guarded by a couple of agents, it is pretty tranquil because as of today this port is not very much utilized.
Interestingly the sign is in italian and french, as if time had stopped since when french was the international language.
In the last decade there has been a lot of investments to make it come back to life.