Inspection Failed

Inspection Failed refers to a situation in foreign trade where, after the buyer or a third-party inspection agency designated by the buyer inspects the goods delivered by the seller, the goods are found to be non-compliant with the contract terms or relevant standards in terms of quality, quantity, packaging, specifications, etc., resulting in a non-conformity report. This term is commonly used in pre-shipment inspection (PSI) or destination port inspection under trade terms such as FOB and CIF. Usage scenarios include: the buyer entrusts agencies like SGS or BV to inspect the goods; if the report shows non-compliance, the buyer has the right to reject the goods, demand a price reduction, request replacement, or claim compensation. Note: Inspection failure does not equal a fundamental breach of contract and must be judged in conjunction with the contract terms; if the contract stipulates 'seller's inspection prevails' or 'reasonable tolerance allowed,' the buyer cannot arbitrarily claim failure. It is the opposite of 'Inspection Passed' and differs from 'Quality Dispute,' which may occur after receipt of goods. Foreign trade practitioners should clearly specify inspection standards, time, and agency in the contract to avoid disputes arising from inspection failure.