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Inspection Certificate Not issued and Signed by the Party Required by the Letter of Credit

An inspection certificate should be issued by the party stated in the letter of credit.











According to letter of credit rules and standard banking practices an inspection certificate, however named, must appear to be issued and signed by the entity stated in the letter of credit. For example, if letter of credit requires that pre-shipment inspection certificate should be issued by SGS, Intertek or CCIC Inspection Company, the inspection certificate that has been presented by the beneficiary must be issued and signed by one of these independent inspection companies.

If issuing banks find out that an inspection certificates have not been issued and signed by the entities as required by the letters of credit, they will raise a discrepancy which is known as inspection certificate not issued and signed by the party required by the letter of credit discrepancy.

Discrepancy Example: Inspection certificate not issued and signed by the party required by the letter of credit 
A letter of credit has been issued in SWIFT format, subject to UCP latest version, with the following details:

Field 45A: Description of Goods and or Services: 20mtons of %100 organic Italian Extra Virgin olive Oil. Delivery Terms: CIF Port of Newark, USA Incoterms 2010.
Field 46A: Documents Required: 
  • Beneficiary's dated and manually signed commercial invoice in duplicates bearing full description of goods and its quantity, net and gross weight, unit and total price.
  • Insurance policy covering all risks showing claims payable in USA.
  • 3/3 full set original clean bills of lading made out to order of issuing bank, notify applicant company indicating freight prepaid stating the name, telephone and fax numbers of carrier's agent in port of discharge. Bill of lading should evidence shipments made in refrigerated 40' closed containers.
  • The original inspection certificate issued not prior to marine bill of lading date by S.G.S or its authorized agent on S.G.S letter head certifying that the goods shipped/inspected are in conformity with the quality, quantity, and packing of the goods loaded are strictly complying with specifications of the goods indicated in the relative Purchasing Instruction, the terms of the l/c and all subsequent amendments as presented to S.G.S by the importer. The inspection certificate shall verify that the goods are in conformity with USDA organic food standards.

The beneficiary presented an insurance policy as shown on the below picture.











Reason for Discrepancy: According to letter of credit rules and standard banking practices an inspection certificate, however named, must appear to be issued and signed by the entity stated in the letter of credit.




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Who should issue an inspection certificate? 
By whom the inspection certificate must be issued as per UCP 600? Who can issue pre-shipment inspection certificate, container inspection certificate, container load check certificate, production monitoring certificate according to latest letter of credit rules?

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Letter of Credit Conditions



inspection-certificate-discrepancy
Inspection Certificate Discrepancy


Inspection certificate should have been issued by S.G.S or its authorized agent on behalf of S.G.S inspection company. On the other hand inspection certificate issued by another inspection company.

Related Pages: Certificate of Origin Presented Instead of a GSP Form ACertificate of Origin not Issued by the Chamber of CommerceDescription of Goods Differs from the Letter of CreditOrigin of Goods Inconsistent with the Letter of Credit, Certificate of Origin Shows a Consignee Different from Bill of Lading, Gross Weight is not Consistent with the Gross Weight on Bill of Lading, Correction/Alteration is not authenticated by the Chamber of Commerce