Preshipment inspection is the practice used by governments, primarily in developing and least developed countries, of contracting private companies to verify shipment details, such as the price, quantity and quality of goods prior to the goods departing the country of exportation.
The governments use preshipment inspection agencies’ services for a variety of reasons, including to prevent capital flight or undervaluation of imports and to compensate for the inadequacies in customs and other administrative structures.
The Agreement on Preshipment Inspection was negotiated in the Uruguay Round. The Agreement on Preshipment Inspection recognizes that the principles and obligations of the GATT 1994 and other WTO Agreements apply to preshipment inspection agencies’ activities which are mandated by governments.
In 1999, the WTO Working Party on Preshipment Inspection recommended, and the General Council approved, a decision providing for the Customs Valuation Committee to be the forum for reviewing the operation of various Members’ preshipment inspection regimes and the implementation of the WTO Agreement on Preshipment Inspection.