Issue with certification agency on exports to China

Below is a question raised by a reader on this site..

case study regarding certification agencyHi.

We recently exported (FOB) a small consignment of Copper concentrate to China.

At the warehouse we had 2 piles separated from each other, with Pile 1 comprising Cu fines being tested by a Chinese state owned certification agency with no red flags raised. the 2 piles were a considerable distance apart.

Subsequent to this, the buyer requested we appoint another international certification agency to inspect, weigh and label the bags comprising pile 1.


We complied and appointed them, identified pile 1 (together with representatives from the warehouse).

What transpired after the containers were sealed and loaded into the containers by the certification agent, it was confiscated in China, for possibly containing waste material.

The buyer is adamant we must pay the fine (if any is imposed by Customs).

We first suspected theft, but now realised that the certification company included material from pile 2 and is evasive on our complaint to them.

We can prove the certification agent was in the wrong here.

What is the best way forward with the certification agency and how do we deal with Chinese customs.

All comments welcome..

what is your opinion

*** End of Article ***

5 thoughts on “Issue with certification agency on exports to China”

  1. I think the buyer and warehouse personnel were together in a bad intentioned plan from the beginning, mainly because it was requested the appointment of another international certification agency. Probably to validate the plan.

    Question: the chinese 1st class certification agency appointed by buyer was present during the inspection, weighing and labelling of bags carried out by the certification agency appointed by FOB sellers? In my opinion, they should be together for a joint sealing of bags.

    Furthermore, it is not the certification agency that fill up the bags, but the warehouse personnel. Is there any way to prove that the warehouse personnel had not mixed the cargo from pile 2 with cargo from pile 1?

    When is said that: “We can prove the certification agent was in the wrong here”. Which one you mean? The one appointed by buyer or you willing to say that your own certification agency certified cargo from pile 1 and allowed mixture of both piles afterwards?

    Sorry, I brought more doubts in the case. Hopefully it can assist to better investigate the case.

    Reply
    • We recorded the inspector of the certification agency where he confirms what his instructions were to the extent that we can show without doubt that he sealed bags he admitted he was not to touch and which he subsequently loaded into containers. This is one of the largest certification companies in the world headquartered in Europe and they are currently ducking and diving the issue. Not even sure how to take them on yet.

  2. First problem, using FOB for containers – what is your definition and your buyer’s definition of those three letters?

    Second problem, what are your payment arrangements?

    Third problem, your destination country. It is proving to be troublesome and unreliable, decisions are taken based on anything at all including how the CCP feels at that moment. Just ask any Australian exporter right now.

    That leads to the fourth problem, you don’t deal with Chinese Customs, your buyer in China does.

    Good luck!

    Reply
    • Thank you for your insights Bob. FOB was linked to Seller (our) port of discharge, and fortunately we received the bulk of the payment. My learnings from this is for everyone out that there to be aware of Chinese Customs. The impression I get is that the rule of law does not apply. You are guilty irrespective of being innocent.

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