Recommendations for improving garment hanging container inspection activityin dai viet inspection and service joint stock company

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MINISTRY OF TRANSPORTATION MINISTRY OF EDUCATION & TRAINING
VIETNAM MARITIME UNIVERSITY
STUDENT NAME: PHAM THI THU TRANG
DISSERTATION
GLOBAL STUDIES AND MARITIME AFFAIRS
RECOMMENDATIONS FOR IMPROVING GARMENT HANGING
CONTAINER INSPECTION ACTIVITY IN DAI VIET
INSPECTION AND SERVICE JOINT STOCK COMPANY
HAI PHONG – 2015
MINISTRY OF TRANSPORTATION MINISTRY OF EDUCATION & TRAINING
VIETNAM MARITIME UNIVERSITY
STUDENT NAME: PHAM THI THU TRANG
CLASS: GMA 02
DISSERTATION
GLOBAL STUDIES AND MARITIME AFFAIRS
RECOMMENDATIONS FOR IMPROVING GARMENT HANGING
CONTAINER INSPECTION ACTIVITY IN DAI VIET
INSPECTION AND SERVICE JOINT STOCK COMPANY
Supervisor: Tran Hai Viet
Division: International Economics
Faculty: Economics
HAI PHONG – 2015
Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
PREFACE
I declare that this report is my own unaided work. It has not been submitted
before.
If violated, I am solely responsible for and bear the punishments of the Institution
and University.
Student Name and Signature
Pham Thi Thu Trang
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
ACKNOWLEGEMENT
I have strived to complete the dissertation; however, it would not be
performed without the support and help from many individuals and
organizations. I would like to extend my sincere thanks to all of them. First and
foremost, I would like to express my sincere gratitude to my supervisor Trầần H ải
Việt for the continuous support of my dissertation, for his patience, motivation,
enthusiasm, and immense knowledge. His enthusiastic guidance helped me in all
the time of research implementation. Second, I would like to express my gratitude
towards all staff at Dai Viet Inspection and Service Joint Stock Company,
especially Industrial Department for their kind co-operation which helps me to
finish this project. Last but not least, I would like to express my special gratitude
and thanks to lectures at Vietnam Maritime University for giving me such
attention and time.
Pham Thi Thu Trang – GMA 02 Page ii
Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
TABLE OF CONTENTS
PREFACE................................................................................................................................................................. i
ACKNOWLEGEMENT........................................................................................................................................ ii
TABLE OF CONTENTS..................................................................................................................................... iii
LIST OF ABBREVIATIONS............................................................................................................................... v
LIST OF TABLES................................................................................................................................................. vi
LIST OF FIGURES............................................................................................................................................. vii
INTRODUCTION.................................................................................................................................................. 1
CHAPTER 1: LITERATURE REVIEW.......................................................................................................... 4
1.1 Introduction about Inspection................................................................................................... 4
1.1.1 Definition and classification.............................................................................................. 4
1.1.2 The definition and classification of imported/exported cargo inspection....6
1.1.3 The role of imprted/exported cargo inspection........................................................6
1.1.4 Inspetor....................................................................................................................................... 8
1.2 Inspection contract......................................................................................................................... 9
1.2.1 Definition.................................................................................................................................... 9
1.2.2 Classification.......................................................................................................................... 10
1.3 Inspection certificate................................................................................................................... 10
1.3.1 Definition................................................................................................................................. 10
1.3.2 Some requirements of inspection certificate............................................................11
1.3.3 Legal validity of inspection certificate........................................................................11
1.3.4 The content of inspection certificate...........................................................................12
1.4 The basic methods of cargo inseption..................................................................................13
1.4.1 The method of quality and specific inspection........................................................13
1.4.2 The method of specific-detailed quantity inspection............................................14
1.4.3 The method of trade volume inspection.....................................................................14
1.4.4 Draft (Draught) Survey method....................................................................................14
1.5 Introduction of garment hanging container.....................................................................15
1.5.1 Hanging container.............................................................................................................. 15
1.5.2 Garment good........................................................................................................................ 17
CHAPTER 2: ANALYZING INSPECTION ACTIVITY OF GARMENT HANGING CONTAINER
OF DAI VIET INSPECTION AND SERVICE JOINT STOCK COMPANY AT HAIPHONG
(DAIVIETCONTROL)....................................................................................................................................... 18
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
2.1 Daivietcontrol Overview............................................................................................................ 18
2.1.1 General information about Daivietcontrol Company...........................................18
2.1.2 The inspection category of the Dai Viet Inspection And Service Joint-Stock
Company.................................................................................................................................................... 19
2.1.3 Organizational structure..................................................................................................23
2.1.4 The inspection business operation of Daivietcontrol..........................................25
2.2 The garment hanging container (exported container) inspection procedure of
Daivietcontrol............................................................................................................................................... 28
2.2.1 Definition................................................................................................................................. 28
2.2.2 The necessary documents for garment hanging container inspection.........28
2.2.3 Process of inspection.......................................................................................................... 29
2.2.4 Example about garment hanging container inspection procedure (Example
of Maersk Line)........................................................................................................................................ 35
2.3 Evaluating inspection activity of garment hanging container.................................39
2.3.1 In terms of business operation....................................................................................... 39
2.3.2 In terms of inspection process........................................................................................42
CHAPTER 3: RECOMMENDATIONS FOR IMPROVING GARMENT HANGING CONTAINER
INSPECTION ACTIVITY IN DAI VIET INSPECTION AND SERVICE JOINT STOCK
COMPANY........................................................................................................................................................... 46
3.1 In terms of personnel management......................................................................................46
3.1.1 Recruitment............................................................................................................................ 46
3.1.2 Training................................................................................................................................... 46
3.1.3 The distribution of laborforce........................................................................................47
3.1.4 Salary and remuneration policy....................................................................................47
3.2 In terms of facility......................................................................................................................... 47
3.3 In terms of service quality......................................................................................................... 48
3.4 In terms of customer policy...................................................................................................... 48
3.5 In terms of cooperative relations...........................................................................................49
CONCLUSION..................................................................................................................................................... 50
REFERENCE....................................................................................................................................................... 51
APPENDICES...................................................................................................................................................... 52
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
LIST OF ABBREVIATIONS
TCVN ISO/IEC The general standard for activities of inspection
17020:2012 organization
BoA Bureau of Accreditation
ISO 9000 International Standard Organization 9000
BVQI Bureau Veritas Quality International
QUACERT Metrology and Quality – Vietnam Certification Centre
FDA The Food and Drug Administration
ASTM American Society for Testing and Materials
API American Petroleum Institute
L/C Letter of Credit
B/L Bill of Lading
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
LIST OF TABLES
TABLE 1.1: GARMENT HANGING CONTAINER DIMENSIONS........................................16
TABLE 2.1: BUSINESS ACTIVITY RESULT OF DAIVIETCONTROL FROM 2010 TO
2014........................................................................................................................................................ 26
TABLE 2.2: REVENUE BY PRIMARY COMMODITIES INSPECTION OF
DAIVIETCONTROL IN 2014........................................................................................................... 27
TABLE 2.3: PERSONNEL AND EQUIPMENT FOR PROCESS............................................30
TABLE 2.4: BUSINESS ACTIVITY RESULT OF GARMENT HANGING CONTAINER
INSPECTION FROM 2010 TO 2014............................................................................................39
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
LIST OF FIGURES
Figure 1.1: View of inside garment hanging container.....................................................16
Figure 1.2: Garment Goods............................................................................................................ 17
Figure 2.1: Dai Viet Inspection and Service Joint-Stock Company...............................18
Figure 2.2: Maritime Inspection.................................................................................................. 19
Figure 2.3: Machinery and Necklaces Survey........................................................................20
Figure 2.4: Chemicals, Ores and Minerals, and Construction Materials....................21
Figure 2.5: Inspection of Imported/Exported Cargo..........................................................22
Figure 2.6: Inspection of General Cargoes at Warehouse/yard....................................22
Figure 2.7: Organizational Chart...............................................................................................23
Figure 2.8: The Garment Hanging Container Inspection Procedure of
DaiVietcontrol..................................................................................................................................... 31
Figure 2.9: The ratio of revenue over cost..............................................................................40
Figure 2.10: The rate of return on revenue............................................................................41
Figure 2.11: The case number of inspection..........................................................................42
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Recommendations for improving garment hanging container inspection activity
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INTRODUCTION
1. Necessity
In the globalized economy, the commodity and service of each country are over
the bounder and integrate in international flow. The process of exchanging
goods and service contribute to expand world market share and boost the
international economic relationship. Along with stage, imported and exported
good activity have more important role with Vietnamese economy in particular
and world economy in general. Especially, this operation helps for making the
solid foundation to develop a national capacity in the period of Industrialization
and Modernization.
In the imported-exported activity, cargo can be damage, broken or loss… So
that, for resolving dispute and having external evidence to determine
responsibility of related parties along with solving other issue in forwarding,
payment or handling cargo…., the inspection organization is one of the third
parties for checking the actual cargo condition and it is the tool for each party
dividing responsibility. From the essential role of inspection, this service is
crucial activity for international trade. However, Joining the World Trade
Organization (WTO) and signing Free Trade Agreement (FTA), competition of
Vietnamese inspection market increasingly fierce, between domestic inspection
organizations, between domestic and foreign inspection organizations. In the
recent years, Vietnam garment industry has a large potential for trading. The
reason for this is that Vietnam has a huge labor force resource with young
population structure so the incearse in cost for this resource not much as the
rapid of garment trading growth. Furthermore, Vietnam has a stable investment
environment with signinficant growth leading to attract foreign partner.
According to the study of Promoting of trading for developing country to EU
(CBI) of Holland Foreign Affair Ministry, Vietnam growth rate of garment
trading in period of 2005 and 2011 was in the first place with 32% while China
reached 15% and other state as Malaysia and Thailand followed by 7%. In April
2013, export turnover of Vietnam was 5.1 billion USD with growth rate of
20.3%. With the intergration, TTP agreement will become a potential chance for
garment industry of Vietnam. Besides, the development of science and
technology led to the requirement for the higher inspection service quality.
There are huge problems of assessment organizations in Vietnam in general, and
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
of Dai Viet Inspection and Service Joint Stock Company in particular. The
higher inspection service quality and improving of inspection process for
competing are unsolvable problem of Dai Viet Inspection and Service Joint
Stock Company.
2. The purpose of the thesis
From the meaning, important role as other related issues around this service, I
decided to research the subject: “Recommendations for improving garment
hanging container inspection activity in Dai Viet Inspection and Service Joint
Stock Company” with the desire to learn the operations and inspection process
of the Dai Viet Inspection and Service Joint Stock Company, and give solutions
to improve garment hanging container inspection for company development in
competitive assessment market.
3. Object and scope of research
Research object: garment hanging container and stuffing
Research scope:
- Time: operating time of the Dai Viet Inspection and Service Joint Stock
Company from 2010 to 2014
- Space: Dai Viet Inspection and Service Joint Stock Company at Haiphong
4. Research Methodology
In order to perform this thesis, I used the scientific method as:
- Methods of analysis and synthesis
- Methods of economic statistics
- The methodology is based on historical evidence
- And many different scientific methods
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
5. Research finding
The dissertation codified certain theoretical issues and practices related to the
inspection activity of garment hanging container and assessed advantgaes and
disadvantage of this object. Therefore, it can be drew recommendations for
improving garment hanging container inspection of Daivietcontrol Joint Stock
Company in the future.
6. The contents of the thesis
Content of thesis consists of 3 chapters:
Chapter 1: Literature review
Chapter 2: Analyzing inspection activity of garment hanging container of Dai
Viet inspection and service joint stock Company at Hai Phong
Chapter 3: Recommendations for improving garment hanging container
inspection activity in Dai Viet Inspection and Service Joint Stock Company
During the completion of thesis, I have unavoidably mistakes, I request
respectfully that instructors and teachers in Council instruct and forgive.
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
CHAPTER 1: LITERATURE REVIEW
1.1 Introduction about Inspection
1.1.1 Definition and classification
1.1.1.1. Definition of inspection
“General standards for the operation of inspection organizations – TCVNISO/IEC
17020:2012” that is issued in 2012, according to Vietnam Standard, having
definition of inspection: “Inspection is considering product design, product,
process; and determines conformity with specific requirements or determines
conformity with the general requirements on the basis of expert assessment”
The Article 254 of the Commercial Law in 2005 regulates: “inspection service is
commercial activity, the businessman implements necessary job to determine the
real status of cargo, the results of service provisions and other requirements of
customers”. The definion shows that commercial inspection is the activity of the
third party for evaluating status condition of inspection object follow by the
requirement of organization or individual. The foundation for inspection
operation is the strong combination among human element, facility, technology,
method in expertise appreciation. So that, inspection not only contributes in
minizing business risk but also helps the state agencies in management in order
to ensure a secure business environment, effectiveness for investors.
1.1.1.2. Classification of inspection
The Categories of Inspection are revised time by time. However, where the
existing classification descriptor does not cover the needs of an inspection service,
Bureau of Accreditation (BoA) issued “Categories of Inspection” (code: AGI 02) in
November 30th, 2011 in order to specify, classify categories of inspection.
a. Classify by products
Agriculture products: A Process and/ or a product of farming, picking (for
plants), such as: grains, coffee, peppercorn, cotton, vegetables, roots, fruits, and
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
other agriculture products. A Process and/ or a product of keeping and catching
(for animals), such as: domestic fowls, livestock.
Aquatic products: Keeping: shrimp, fish…; processing: preliminary treatment,
frozen….
Processed foods (except agriculture products, seafood): Products are produced
for eating and drinking.
Feed stuff: Materials, foods for domestic fowls, livestock and other feed stuffs.
Industrial equipment and machinery: Pressure equipment, Lifting and lifted
equipment, Industrial machinery, Construction equipment, Pipelines, Storage
tanks, other
Manufactured goods: Fabricated metal components and products, Molded
polymers and composites, Electrical and electronic products, Nano products,
Textiles and textile products, Refractories and ceramics, Timber products,
Chemicals, Fertilizers, other
Gas, petroleum and petroleum products (except chemicals, fertilizes)
Ores and minerals (except coal)
Coal
Vehicles: Non – motorized vehicles, Motorbike, Automobile, Specialized vehicles,
Spare – part
Building construction: Industrial buildings, Residential buildings, Structures,
Construction Materials
Environment: Soil and geotechnical, Vegetation, Hydrology, Biota, Atmosphere,
Noise and vibration, Built environment, Electromagnetic fields
b. Classify by range of inspection
Net quantity: Quantity, weight, draft report…
Inspection of processes: Welding, Coatings, Packaging, Labelling, Cleanliness,
Process surveillance
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
Marine: Hold Cleanliness Survey, Water Hose Test Survey, Sealing Plan, Damage,
Condition
1.1.2 The definition and classification of imported/exported cargo
inspection
1.1.2.1. The definition of imported/exported cargo inspection
The Vietnam Chamber of Commerce and Industry clearly shows the concept of
imported/exported cargo inspection:
The imported/exported cargo inspection is the activity service and it is
implemented by independent assessment agency. Through using scientific and
technical methods and inspection operation, the company can determine and
provide the evidence of cargo situation as other related issue follow by
requirement of the imported/exported firm as other individual or organization.
1.1.2.2. The categories of imported/exported cargo inspection
Base on each purpose, capability, scope and business field of inspection
organization, each organization provides different imported/exported cargo
inspection service. There are several main imported/exported cargo inspection
categories:
- Inspection of quantity, quality, specification, package, packing, place of
origin, goods value, damage and safety and hygiene.
- Inspection of forwarding and storing goods
- Inspection in manufacturing process and each step of goods
manufacturing
- Other categories relates to imported/exported cargo when arising
requirement.
1.1.3 The role of imprted/exported cargo inspection
The putting provision in contract not only increases the responsibility of parties
but also facilitates for related parties in implementation process of this contract.
Specificially:
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
Seller: Using the result of the third party objectively as an evidence for
implementing contract and it reduces the cost time and moving. Besides this,
survey report is one of the basic documents for seller in payment.
Buyer: Through inspection organizations, the buyer can receive enough and right
(number/volumn/quantity, type, origin, quality…) goods that they buy without
checking themselves. Especially, when the fail or damage happens, survey report
is an objective evidence for compensation.
Carier: The carrier has reliable mainstay to confirm their job accordance with
the requirement of technical transport. They confirm the ship has enough
capability for storage and seaworthiness, prove their responsibility in minizing
the damage in force majeure case, use the result of volumn and weight inspection
to compute transportation fee.
Preservator: The inspection organization proves that they use warehouse
following the right specification as fumigation, arrangement, re-arrangement
warehouse… accordance with type of cargo. They supervise; confirm the correct
number/volume, quality goods in forwarding process and entry warehouse.
Insurance company: The Company has independent organization to determine
the extent, cause of damage and distribute cargo damage or means for
compensation and appeal related to the third party.
Credit/financial organization, bank: The seller can receive the money when they
implement enough provision in contract thourgh this system. In addition,
inspection can help these organizations determining the right value of pledged
assets when having credit loan and ensure business secure.
Inspection service help for management and other related job.
Custom agency: Custom agency is a professional organization for determing
exact number/volumn, type, quality, price… of goods then conducting customs
clearance procedures of imported/exported goods. The job help the government
collects exact and enough tax, prevent combating tax evasion and commercial
fraud.
Supporting for State management agencies: Inspection helps to manage goods
quality for avoiding imported default commodity, prohibited waste… it prevents
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Recommendations for improving garment hanging container inspection activity
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damage to business, domestic consumer, minimize impact to environment and
avoid exporting poor quality goods (loosing the reputation of country) or
exporting the better goods quality (loosing for the firm). Especially, inspection
activity help to control the domestic goods flow, ensure quality, validity, safe
using, anti counterfeiting then protecting community health, the right of
consumer and prevent the chaos domestic market.
Supporting in environmental management: Inspection activity help the firm and
assessment agency to figure out the effect to environment in building as
manufacturing by inspection air, water, land pollution… In the industrialization
process, inspection also helps government and enterprises to manage the quality
and quantity of imported machinery, do not enter outdated machinery.
Involving in price appraisal activity: In the period of promoting investment,
inspection activity help much in valuation of asset, machinery, business value…
Appraisal activity makes the purchase of property, machinery and equipment,
business valuation near to market value and minimizes the damage if have.
Consultant: Inspection organization has enough condition to consult for the
customer in term of commercial legal, goods quality, the issue related to import
and exporting, consult for building and apply international quality management
system to operate the work in the best and effective way.
Supporting for the investigating authorities, economic referee: The inspection
organization provides number/volumn, quality, type, price… of goods/asset for
the investigation, the court related to law violations as embezzlement,
smuggling, fraud, theft and the dispute among parties of commercial contract.
1.1.4 Inspetor
1.1.4.1. Definition
According to Collins English Dictionary - Complete and Unabridged 10th Edition,
publishing in 2012, inspector (assessor/surveyor) is a person who inspects or
examines for compliance with regulations, standards
Besides, following the definition of Consulting Surveyors New South Wales (NSW)
launched in 2014 shows that inspector is an expert person and they use their
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Recommendations for improving garment hanging container inspection activity
in Dai Viet inspection and service Joint Stock Company
academic qualifications, technical expertise, and interpretative ability and
management skills to inmplement inspection operation. The surveyors show the
last result in survey report and they must to take the responsibility of result in
report.
1.1.4.2. Inspector s’ standard
The Article 259 of the Commercial Law in 2005 shows the standards for
commercial inspector. Inspector must have standards:
- Having a university or college degree compatible with the requirements of
the assessment field
- Having a professional certificate in compulsory case according to the law
- Having at least three years of working experience in the goods/services
assessment field
Depending on these standards, director of Inspection Company recruits assessor
and this man takes responsibility under law for his decisions.
1.1.4.3. Responsibility and obligations of inspector
Decree No. 20/2006/Decree – Government on February 20th, 2006 of
Government under the guiding of Commercial Law regulates about responsibility
and obligations of inspectors
Responsibility:
- Inspector has the right to require full information of shipment and
document for inspecting
- Inspector has the right to reject any interference in assessment leading to
discrepancy result
- Inspector has the right to reject any assessment relating to their interests
Obligations:
- Inspectors have to perform independently inspection case
- Inspectors must be honest, objective, on time and accurate in assessment
job
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Recommendations for improving garment hanging container inspection activity
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- Inspectors have to give an accurate assessment results and sign in Survey
Report
- Inspectors must keep confidential inspection information, documents and
results followed by the customers’ requirement
- Inspectors take the responsibility for the assessment results
1.2 Inspection contract
1.2.1 Definition
Inspection contract is the document and it has legality, signed by separately
inspection organization with the firm or required inspection organization. The
inspection organization will implement inspected operation follow the legal
requirement of required inspection, proving survey report and receiving the
inspection fee. The fee will be public by company with each type, object of
inspection and will be negotiated in the contract.
1.2.2 Classification
The main inspection contract
1.2.2.1. Short term contract (with each case in short time)
This contract is inspection requirement document. It is the simplest form of
contract and is used mostly today. Each inspection organization issues each
inspection document and it has the information as following:
- Customer information, the inspection requirer
- Inspection organization information
- Inspection requirement category
- Time, place for inspection operation
- The requirement documents need to gather and provide
- The number of final survey report
- The language in survey report
- Inspection fee with payment arrangement
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Recommendations for improving garment hanging container inspection activity
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1.2.2.2. Long term contract (for a long time)
The contract has organization as the normal economic contract but the provision
is negotiated more detail. The content in contract includes the same provision
with inspection requirement. The contract usually has 1 year duration and use
for one specific inspection category at one specific location. When having the case
for inspection, the inspection requirer will call or send email the time and place
for inspection organization.
1.3 Inspection certificate
1.3.1 Definition
According to provision I, Article 260, Section 6, Vietnam Commercial Law 2005
defined: “Inspection certificate is the document for determining the actual
condition of cargo, serive following the inspection content by customer
requirement”
Inspection certificate is necessary objective evidence and it is issued by separately
organization legally. It determines the cargo status and the cause of the current
status of the goods. The document records the result of inspection case and is the
important legal evidence in resolving disputes, the complaints and legal
proceedings of cargo. Each inspection organization has each inspection
certificate. The content in this document must be objective, truthwoth about
inspection result. The certificate will be provided for the inspection requirement
organzation or the third party follow by the agreement in document with
inspection require.
1.3.2 Some requirements of inspection certificate
The certificate must ensure to recognize the inspection organization, distinguish
the survey, and identify object, time and location of inspection, the time of
providing survey report…
Inspection certificate ensures truthworthy, accuracy and objectivity, the legality
of the inspection result, adapting as matching the egitimate requests of customer.
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