WORLD TRADE
ORGANIZATIONG/L/300
18 March 1999
(99-1099)
Council for Trade in Goods
25 March 1999
REPORT OF THE WORKING PARTY ON
PRESHIPMENT INSPECTION
Section A
1. The Working Party on Preshipment Inspection (hereafter the Working Party) was established
by the General Council at its meeting of 7, 8 and 13 November 1996, with a mandate to conduct the
review provided for under Article 6 of the Agreement on Preshipment Inspection, and to report to the
General Council through the Council for Trade in Goods (CTG) by December 1997.
2. On 10 December 1997, the Working Party, under the Chairmanship of Mr. Chiedu Osakwe
(Nigeria), presented its report, contained in document G/L/214 dated 2 December 1997, to the General
Council, which adopted it.  Based on the recommendations made by the Working Party, it was agreed
to extend the life of the Working Party for one year, until the end of 1998.
3. During 1998, under the Chairmanship of Mr. Edward Brown (United Kingdom), the Working
Party held four formal meetings and five informal  meetings to exchange views on the items identified
in its December 1997 report.  During the informal meetings the views of various international
organizations were heard, as well as those from IFIA (the International Federation of Inspection
Agencies), the ICC (International Chamber of Comm erce), and a firm of PSI auditors.  Additionally
the subject of trade facilitation, following a mandate from the CTG in September 1998 to include it on
future agendas, was discussed.  The Working Party submitted its report to the General Council,through the CTG, on 10 December 1998 (G/L/273).  The General Council adopted the report thereby
agreeing to a further extension of the Working Party until 31 March 1999.
4. The following report should therefore be read in conjunction with the Working Party’s 1997
and 1998 reports to the General Council.
Section B
Background
5. The objectives of government-mandated Preshipment Inspection (PSI) programmes have
evolved since the early 1960s.  Initially they were used almost exclusively to address exchange
control concerns, but in more recent years, as trade has become liberalized and exchange controls
have been removed, the emphasis of PSI programmes has shifted towards revenue collection.
Primarily PSI aims to detect false invoicing, and ensure governments receive the correct revenue.
6. The main features of PSI programmes are:- inspecting goods in the country of export prior to shipping to the country of destination.  This
entails verifying the price paid by the importer, in accordance with Article 2.20(b) of the PSI
Agreement, and checking that the goods conform to the relevant agreed contractualG/L/300
Page 2
specifications as well as the relevant quality and quantity controls in force in the country of
destination.
- some countries limit inspections to a range of sensitive products, all of which are subject to
100 per cent inspections;  and others have an across-the-board inspection programme, againsubject to 100 per cent inspections.  Currently 35 WTO Members employ the services of PSI
companies, which are accredited to IFIA.  A list of the IFIA agents, and the countries using
their services, is provided in Annex A.
The Aims of User Countries
7. The intention of countries using PSI has been to ensure the correct classification and
valuation of imports and to assist in revenue collection.  All Members have accepted that recourse to
PSI is a transitional measure to be used only until their national customs authorities are in the position
to carry out these tasks on their own. Most user Members expressed satisfaction with their PSI
programs and the benefits it had brought, and some expressed the view that by having such programs
trade has  been facilitated,  which would not otherwise have been the case.  However one former user
Member considered that their program had not met any of the goals listed above, had not facilitated
trade, and the costs of the PSI program had exceeded the revenue collected.
The main concerns of exporters
8. In response both the governments and traders of many exporter countries have claimed that
recourse to PSI has created delays to shipments a nd incurred additional costs to international trade.
They raised concerns that on occasion PSI companies resorted to arbitrary methods, failed to keep
inspection appointments, required additional documentation, demanded confidential business
information, and arbitrarily uplifted invoice values.  Yet a number of exporters (including somewhose governments use PSI) have expressed their general satisfaction with the implementation of the
Agreement .
Complaints Procedures
9. Mechanisms exist to resolve complaints through the PSI company concerned, the user
Members' appeals procedures or the Independent Entity, established under Article 5 of the PSIAgreement.  To date, exporters have been reluctant to use the Independent Entity. The ICC suggested
that the non-use of the Independent Entity might be because the provisions of the Agreement have
removed some of the principal sources of disputes between inspection agencies and exporters, or
because of exporters' concern that identifying themselves to the PSI companies could result in
aggravating rather than alleviating the situation,  or because of the costs associated with its use.  IFIA
was of the view that in many cases problems had been settled between the PSI companies and the
exporters concerned.
Section C
1998 Work Programme
10. The Working Party’s exchange of views focused on seven issues (listed below) which were
contained in its 1997 report (G/L/214).  Additionally, the Working Party considered the relationship
between PSI and trade facilitation, as well as technical assistance as envisaged in Article 3 of theAgreement.
Issue 1:  Model contract between governments and PSI companiesG/L/300
Page 3
11. Early in the year Switzerland submitted a proposal, circulated in G/PSI/WP/W/16, for a
model contract between governments and PSI companies;  a copy of the model contract can be found
in Annex B.  The Working Party broadly supported the aim of the contract on the understanding that it
was of a non-binding nature, and that in no way could it affect the rights and obligations of Members
under the Agreement.   Some delegations felt that the value of the model contract was that it offered a
method of incorporating the provisions of the PSI Agreement into the contracts  of user Members.  But
equally the Working Party accepted that governments, in drawing up their own contracts, would also
ensure compatibility with the PSI Agreement.
12. The Working Party also noted that IFIA members had their own code of conduct, distinct
from the model contract, and welcomed the move by IFIA to introduce measures whereby their
members’ adherence to the code would be monitored and corrected if necessary.
Issue 2:  Standardization of inspection documentation
13. The Working Party welcomed the opportunity to hear the views of the ICC and IFIA on how
standardization of documentation could reduce obstacles to trade created by different PSI companiesusing different forms.  Both the ICC and IFIA have  already identified three forms for standardization
(data sheets for exporters, requests for information forms, results of physical inspection), and have
agreed to work together in identifying other possib le areas, including computer software, that could be
standardized.  The Working Party suggested to both parties that the UNECE Standard Layout Key
should be followed wherever possible.  Assuming that standardization of documentation proceeds, itmay well be that interest increases with exporters in having a greater choice of PSI firms, as such
standardization would enable one form to be used irrespective of the PSI firm, in contrast to the
present situation where different forms exist for the same procedure.  The merits of competition
among PSI companies in a contract with one Government is discussed in paragraph 16.
Issue 3:  Selective examination of shipments
14. The Working Party heard from the World Customs Organization that a feature of good
customs practices is the random inspection of goods based on risk management and selection
techniques. In particular it was shown that rather than requiring inspection on a
transaction-by-transaction basis, customs authorities used risk profiles that identified consignments
where inspection was needed.  It was also shown that in addition to random inspection, post-entry andaccount-based compliance methodologies assisted in the effective operation of customs
administrations and it was suggested that governments should endeavour to use such procedures.
IFIA has confirmed that selective inspection would be possible to institute and has proposed two
possible approaches.  These are reproduced in Annex D of the report.   Nevertheless, the use of
selective examination of shipments remains a decision of each Member.
Issue 4:  Auditing of PSI entities
15. The Working Party acknowledged that whilst auditing per se  is widely understood and used,
the auditing of PSI entities is a new phenomenon.  Unlike conventional auditing, the role of PSIauditing is primarily to monitor the price-verifica tion activities of PSI companies to ensure their
accuracy and objectivity.  At present only two user Members use the sole firm of PSI auditors, and
both have expressed their satisfaction with the positive experience and the results they have obtained
in achieving greater transparency and ensuring the effective control of PSI services.  The Working
Party was grateful for the useful presentations ma de by the auditing company and its attorneys, in
explaining their function, as well as the observations and contribution of IFIA which led to a lively
debate. The Working Party noted that user Members may wish to consider the potential benefits of
PSI auditing as indicated by the two Members using PSI auditing.   If governments currently using PSI
agents  choose to employ auditors, they should ensure that the rights of traders are not adverselyG/L/300
Page 4
affected, for example by causing additional delays or costs to the movement of goods and that the PSI
Agreement is not violated.   The Working Party suggests that the guiding principles, listed in Annex C,
supplied by the European Communities, should be considered.
Issue 5:  Promotion of competition amongst PSI agents
16. Similarly the notion of competition is well-known, but the Working Party is unable to
comment on whether engaging more than one PSI agent necessarily results in benefits for
exporters/importers or creates competitive conditions.  Certainly from what the Working Party heard
from Members using more than one firm, there is no thing to suggest that such practice is any more
detrimental to the effective functioning of the Ag reement than employing only one company;  but the
choice must remain with governments, based on th eir consultations with traders.  The Working Party
did not consider it appropriate to recommend the automatic adoption of competitive bidding amongst
PSI companies for those Members currently using PSI companies.
Issue 6:  Fee structures for PSI entities
17. The Working Party appreciated IFIA’s input to this complicated debate.  The Working Party’s
discussion centred on whether ad valorem  fees charged by PSI agents and based on their price
evaluations as contained in the “Clean Report of Finding” (CRF) were an incentive for the PSI agent
to increase the values of the CRFs so as to attract a higher fee.  The Working Party acknowledges
IFIA’s agreement to consider charging fees, subject to current contractual obligations, on an ad
valorem  rate of the declared value instead of an ad valorem  fee based on the clean report of finding
(CRF).  Some Members raised concerns about the use of ad valorem  fees and their conformity with
GATT Article VIII and considered that flat-fees should be charged for services rendered.  In the
meantime, the Working Party considered  that new contracts should not  use fee structures based on ad
valorem  rates as contained in the clean reports of findings.  Further discussion on this topic is needed
but the Working Party noted the firm views of some  Members that, whichever method is used, the
fees should be borne by the user government and not the traders and must conform to the provisions
of GATT Article VIII .  The Working Party also noted the firm views of other Members that it is up to
each user Member to determine who should bear the fees, and that this is a matter not explicitly
addressed in the PSI Agreement.  The Working Party also observed that several Members were
currently charging PSI fees to importers.
Issue 7:  Price databases
18. The Working Party noted that it is an accepted practice for modern  customs administrations to
use, as part of their risk management and assessment indices, a database (confidential or not)
containing carefully selected information covering factors such as price, weight, volume, name ofshipper, origin of the goods, etc., in order to determine whether a particular shipment was bona fide.
Where relevant, confidential business information in such databases should be protected.   This
highlights that price is but one element in determining whether goods require inspection and hence the
concern of some Members who felt that undue emphasis on a database containing solely reference
prices could lead to arbitrary valuation.
19. Some delegations shared Colombia's views, as explained in its communication in
G/PSI/WP/W/22, that having price databases would be  a useful stepping stone in the transition to
modern customs administrations and the withdrawal  of PSI Services.  Other Members continued to
have concerns with the potential misuses of such databases, as mentioned in a communication fromthe United States in G/PSI/WP/W/20.  The Working Party agreed that price databases must not be
used to determine minimum prices, or applied in a way that is inconsistent with the Agreement on
Implementation of  Article VII of the GATT 1994  (commonly referred to as the Agreement on
Customs Valuation) and in particular the provision contained in Article 7.1 thereof.G/L/300
Page 5
Trade facilitation
20. The Working Party discussed this issue in resp onse to a request from the Council for Trade in
Goods , at its meeting of 5 June and 8 July, that its sub-committees and working parties add this item
on to their formal agenda.  From these discussions  in the informal group, two themes emerged.  The
first is that any improvement to the efficient function ing of the Agreement, as identified above, will in
itself help to facilitate trade.  The second is that facilitation measures, notably the modernisation and
reform of customs procedure, through the adoption of international standards and practises for
documentation and data, coupled with introduction of modern customs techniques by national
customs authorities, will make it easier for countries to move away from PSI systems, leading
ultimately to better use of resources, improved revenue collection and control, and greater facilitationof trade.
Technical assistance
21. Technical assistance as envisaged under Article 3 of the PSI Agreement was intended to assist
developing countries in making the transition from  PSI.  Therefore the issue of technical assistance in
this context is extremely broad, covering customs valuation and procedures as well as customs
management.  Consequently technical assistance currently provided to developing countries by
international governmental organizations such  as the WCO, WTO, UNCTAD and World Bank, as
well as regional and bilateral  initiatives, to ensure the full implementation of the Agreement on
Customs Valuation, is highly relevant.  Therefore assistance received in this domain should in itself
assist towards the eventual phasing out of PSI.
Section D
Recommendations
22. The Working Party therefore concludes that in addition to the recommendations made in its
1997 report, the following should be added:
(a) that governments must ensure that contracts ar e in conformity with the provisions of the PSI
Agreement;  and encourage Members to consider following the model contract whereverpossible;
(b) that governments should examine incorporating  the principles of selectivity and risk
assessment in their contracts;
(c) that governments who consider having their PSI programmes audited should be guided by the
principles found in Annex C, or ensure that when alternative criteria are used, the principles
contained in the PSI Agreement, such as non-discrimination and national treatment, are
respected;  and
(d) that developed countries  ensure that developing countries receive the necessary technical
assistance for domestic capacity building in order that the transition away from PSI can be
made.
23. The Working Party further recommends that future monitoring of the Agreement should be
undertaken initially by the Customs Valuation Committee, and that PSI should be a standing agenda
item.G/L/300
Page 6
ANNEX A
PSI PROGRAMMES
as at 4 March 1999
COUNTRY TYPE
FOREX/CUSTOMSPSI
COMPANIESSPLIT
GEOGRAPHICAL/
IMPORTERS CHOICE
ANGOLA FOREX/CUSTOMS SGS -
ARGENTINA CUSTOMS BIVAC, ITS,
INSPECTORATE,
SOCOTEC, CONTROL
UNION, SGSIMPORTERS CHOICE
BANGLADESH1CUSTOMS BIVAC, ITS,
INSPECTORATE, OMICIMPORTERS CHOICE
BENIN FOREX/CUSTOMS BIVAC -
BOLIVIA CUSTOMS INSPECTORATE, SGS IMPORTERS CHOICE
BURKINA FASO CUSTOMS SGS -
BURUNDI FOREX SGS -
CAMBODIA CUSTOMS SGS -
CAMEROON CUSTOMS SGS -
CENTRAL AFRICAN
REPUBLICCUSTOMS SGS -
COLOMBIA CUSTOMS BIVAC, COTECNA, ITS IMPORTERS CHOICE
COMOROS2FOREX/CUSTOMS COTECNA -
COTE D'IVOIRE CUSTOMS SGS -
DEM. REP. OF
CONGOCUSTOMS SGS -
ECUADOR CUSTOMS BICAC, COTECNA, ITS,
SGSIMPORTERS CHOICE
GHANA FOREX/CUSTOMS GSBV, COTECNA, ITS, SGS GEOGRAPHICAL
GUINEA CUSTOMS SGS -
INDIA EXPORT
PROMOTION
CAPITAL GOODS
SCHEMEBIVAC, INSPECTORATE,
SGSIMPORTERS CHOICE
IRAN3QUALITY/
QUANTITYBIVAC, COTECNA,
INSPECTORATE, ITS,
OMIC, SGSIMPORTERS CHOICE
KENYA CUSTOMS BICA, COTECNA, SGS GEOGRAPHICAL
LIBERIA CUSTOMS BIVAC -
MADAGASCAR FOREX/CUSTOMS BIVAC -
MALAWI CUSTOMS SGS -
MAURITANIA CUSTOMS SGS -
MALI FOREX/CUSTOMS SGS -
MEXICO4CUSTOMS BIVAC, ITS, SGS IMPORTERS CHOICE
MOZAMBIQUE FOREX/CUSTOMS ITS
                                                     
1 Voluntary PSI programme.
2 To be re-implemented on April 1st, 1999.
3 Only covers quality and quantity of importers' contractual specifications.
4 Goods of certain categories and origins published in Article 10 of the "Agreement on Automatic
imported Advice" are subject to PSI if their unit value is inferior to estimated prices published by the
Government.G/L/300
Page 7
NIGER FOREX/CUSTOMS COTECNA
NIGERIA FOREX/CUSTOMS BIVAC, ITS (SWEDE
CONTROL), ISCGEOGRAPHICAL
PARAGUAY CUSTOMS BIVAC, SGS IMPORTERS CHOICE
PERU CUSTOMS BIVAC, COTECNA, SGS IMPORTERS CHOICE
PHILIPPINES CUSTOMS SGS -
RWANDA FOREX/CUSTOMS SGS -
SENEGAL CUSTOMS SGS -
SIERRA LEONE FOREX/CUSTOMS BIVAC -
TANZANIA CUSTOMS SGS -
TOGO FOREX/CUSTOMS COTECNA -
UGANDA CUSTOMS ITS -
UZBEKISTAN FOREX ITS -
ZANZIBAR FOREX SGS -
Although it is not the policy of IFIA to maintain lists of PSI Programmes, this list has been
exceptionally compiled by the IFIA Pre-Shipment Inspection Committee in answer to a request from
the WTO Secretariat.  Every effort has been taken to ensure the correctness of this list as at the date ofissue but since it will be subject to change, from tim e to time, the details should be verified directly
with the PSI companies concerned.G/L/300
Page 8
ANNEX B
Model Agreement on Preshipment Inspection
Proposal by Switzerland
1. General provisions
1.1 The present Agreement is concluded between the ... (Government)  and the (PSI Company)
(hereinafter referred to as "Contracting Partie s") under the principles and obligations of the
WTO Agreement on Preshipment Inspection (hereinafter referred to as the "PSI Agreement
(WTO)").
1.2 It will enter into force after 60 days in order to allow for sufficient time to inform exporters and
importers.
1.3 The (PSI Company)  shall abide by applicable laws, regulations or requirements of the
(Government)  in accordance with the provisions of the PSI Agreement (WTO).
1.4 In implementing the present Agreement the (Government)  will apply the relevant provisions of
the PSI Agreement (WTO).
1.5 The (PSI Company)  undertakes the obligation to perform  preshipment activities in conformity
with the PSI Agreement (WTO).
2. Scope of inspection
2.1 The PSI activities performed by the (PSI Company)  may include the following services:
(a) quality and quantity inspections, in accord ance with Article 2.4 of the PSI Agreement
(WTO);
(b) price verification, including technical ad vice for purposes of customs valuation, in
accordance with Article 2.20 of the PSI Agreement (WTO);
(c) customs classification.
3. Site of inspection
3.1 All preshipment activities, including the issuance of a Clean Report of Findings (CRF) or an
advice of non-issuance of CRF, shall be performed in  the customs territory from which the goods are
supplied or, if the inspection cannot be carried out in  that customs territory given the complex nature of
the products involved, or if both parties agree, in the customs territory in which the goods are
manufactured.
4. Transparency/information
4.1 The (PSI Company)  shall make available to exporters in a convenient manner all necessary
information referred to in Article 2, para. 6 of  the PSI Agreement (WTO) as well as references
of new or amended laws or regulations relating to preshipment inspection activities received
from (Government) .G/L/300
Page 9
4.2 The (Government)  undertakes to provide the (PSI Company)  with all related laws, regulations
and requirements 60 days prior to the commencement of the PSI programme.  It will also
inform the (PSI Company)  immediately of any amendments thereafter.
5. Confidentiality
5.1 The (PSI Company)  shall treat all information received in the course of the preshipment
inspection as business confidential to the extent that such information is not already published,
generally available to third parties, or otherwise in the public domain.  The (PSI Company)  shall
not divulge confidential business information to any third party.
5.2 In pursuance of this provision the (PSI Company)  shall establish adequate security measures
relating to their offices and employees.
5.3 Notwithstanding paragraph 1 the (PSI Company)  may share confidential business information
with the (Government) , but only to the extent that such information is customarily required for
letters of credit or other forms of payment or fo r customs, import licensing or exchange control
purposes.
5.4 The (PSI Company)  shall not request exporters to provide information regarding:
(i) manufacturing data related to patente d, licensed or undisclosed processes, or to
processes for which a patent is pending;
(ii) unpublished technical data other than data  necessary to demonstrate compliance with
technical regulations or standards;
(iii) internal pricing, including manufacturing costs;
(iv) profit levels;(v) the terms of contracts between exporters and their suppliers unless it is not otherwise
possible for the (PSI Company)  to conduct the inspection in question.  In such cases,
the (PSI Company)  shall only request the information necessary for this purpose.
6. Conflicts of interest
6.1 The (PSI Company)  confirms that it maintains procedures to avoid any conflicts of interest as
defined in Article 2.14 of the PSI Agreement (WTO).  The (PSI Company)  shall inform the
(Government)  on these internal procedures and on any amendments thereto.
7. Technical advice concerning customs valuation principles
7.1 Price verification by the (PSI Company)  for customs purposes shall be limited to the provision
of technical advice to facilitate the determination of customs value by the (Government) .
7.2 When forming an opinion of a value for customs purposes the (PSI Company)  shall not require
the seller to amend the price in the commercial invoice for payment purposes.
7.3 When providing technical advice on customs valuation, the (PSI Company)  shall use the
customs valuation methodology as notified by the (Government)  to the WTO.  The (PSI
Company)  shall inform exporters of the methodology applied.G/L/300
Page 10
7.4 The (Government)  encourages the (PSI Company)  to utilize electronic means for purposes of
providing required information to exporters and importers.
8. Standards
8.1 Quantity and quality inspections shall be perform ed in accordance with the standards defined by
the seller and the buyer in the purchase agreem ent or, in the absence of such standards, in
accordance with relevant international standards and practice.
9. Appeals and independent review procedures
9.1 In case of a dispute between an exporter and the (PSI Company) , the parties to the dispute shall
abide by the procedures set forth in Ar ticle 2.21 (Appeals Procedures) and Article 4
(Independent Review Procedures) of the PSI Agreement (WTO).
9.2 The (PSI Company)  shall establish procedures to receive, consider and render decisions
concerning grievances raised by exporters, and shall make information concerning suchprocedures available to exporters in accordance with the provisions of Article 2.6-7 of the PSI
Agreement (WTO).  The procedures shall be  developed and maintained according to the
guidelines set forth in paragraphs 3-6 below.
9.3 The (PSI Company)  shall designate one or more officials who shall be available during normal
business hours in each city or port in whic h they maintain a preshipment inspection
administrative office to receive and give sympat hetic considerations to, and render decisions on,
exporters' complaints or appeals which should be carried out in accordance with the procedures
of paragraphs 4 and 5 below.
9.4 Complaints to the (PSI Company) :
(i) In the first instance, exporters with any complaints concerning preshipment inspection
activities should be requested to contact the appropriate Department Manager of the
(PSI Company)  giving details of the case.
(ii) The (PSI Company)  shall undertake to investigate the complaint expeditiously.
(iii) If the exporter is not satis fied with the response from the (PSI Company) , the exporter
may proceed to an Appeal in accordance with the procedures of paragraph 5 below.
9.5 Appeals to the (PSI Company) :
(i) Exporters having grievances concerning preshipment inspection activities, which have
not been resolved by discussion with appropriate Department Manager of the (PSI
Company) , may appeal to the (PSI Company) 's senior management.
(ii) The (PSI Company) 's designated Senior Manager should undertake to investigate the
dispute and respond to the exporter, normally within two working days of receipt of the
Appeal, by either (a) giving the result of the Appeal or (b) advising that further
investigation is required and that the result will follow as soon as possible.
9.6 Details of the procedure of paragraphs 4 and 5 above will be made available to exporters by the
(PSI Company) .G/L/300
Page 11
ANNEX C
Guiding principles for the use of PSI auditing
The auditing process:
(1) should not lead to duplication of PSI work;(2) should always apply consistently with GATT and WTO principles and Agreements;
(3) should be undertaken by entities that satisfied reliable auditing credentials;  and
(4) should be undertaken under conditions of independence, confidentiality  and integrity.G/L/300
Page 12
ANNEX D
INTERNATIONAL FEDERATION OF INSPECTION AGENCIES
Geneva Representative Office:  Preshipment Inspection Working Group
Rue François Bonivard 61201 Geneva
Tel./Fax:  (022) 731 15 63
E-mail:  ifia_geneva@ifia.ch
To: Mr. Edward Brown
Chairman, WTO Working Party on Preshipment Inspection
Subject:  Selective Inspection
Dear Mr. Brown,
Thank you for your letter dated 2 March 1999.We wish to reconfirm the statement made by IFIA at the October 1998 informal meeting
when we expressed the view that selective inspectio n is feasible and that there are two main possible
approaches to implementation:
(a) From the user government side:  using a risk profiling approach.  A variation of this concept
has already been implemented in the Philippines whereby the Government has published a list
of goods which are considered high risk and still require to be systematically inspected,
namely (i) certain sensitive goods including second-hand goods, waste products, goods
requiring laboratory analysis, etc.;  (ii) high risk goods determined by Customs;  and (iii)goods which are not adequately described in the importer’s proforma import declaration.
(b) From the country of supply side:  the PSI company can carry out an audit of the exporter’s
premises, for those products exported on a regular basis, to establish a level of assurance on
the products, systems and documents which would enable selective inspection techniques to
be introduced.  Provided the exporter satisfies certain published criteria his consignments
would be eligible for selective inspection which would be carried out using a samplingmethodology in line with international standards.   IFIA believes that this approach would
satisfy the PSI Agreement requirements in respect of non-discrimination and transparency.
Subject to the conclusions of the Working Party on this subject, IFIA would be prepared to
recommend that its members explore with user governments the possibility of implementing selectiveinspection provided this meets with the user government’s requirements.
Please be assured that IFIA is aware of the importance of trade facilitation and IFIA members
will be seriously considering selective inspection and other system enhancements to support this
objective.
Yours sincerely,
Nigel Balchin
IFIA PSI Working Group
PSI Committee
__________