FCL - FULL CONTAINER LOAD SHIPPING – GROUP 3

FCL
FULL CONTAINER LOAD

TABLE OF CONTENTS
I THE DEFINITION OF FCL – FULL CONTAINER LOAD..................................................................................2
II THE PROCESS OF FCL..............................................................................................................................2
STEP 1. Apply for import license..............................................................................................................2
STEP 2. Conduct the procedures of payment obligations.........................................................................2
STEP 3. Charter and store freight (by the seller).......................................................................................2
STEP 4. Contract for insurance.................................................................................................................2
STEP 5. Import customs clearance of goods.............................................................................................2
STEP 6. Take delivery of goods from means of conveyance......................................................................3
STEP 7. Quality inspection, quarantine and inspection of goods..............................................................3
STEP 8. Complaints..................................................................................................................................4
III ADVANTAGES AND DISADVANTAGES OF FCL..........................................................................................4
1. Advantages of FCL...........................................................................................................................4
2. Disadvantages of FCL......................................................................................................................4

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 FCL - FULL CONTAINER LOAD SHIPPING – GROUP 3

I THE DEFINITION OF FCL – FULL CONTAINER LOAD

- FCL, also known as container shipping, stands for Full Container Load. This term refers to a single
shipment that has exclusive use of a container. FCL shipments are suited for those who have large
amounts of goods to send.
- A full container load (FCL) is an ISO standard container that is loaded and unloaded under the risk and
account of one shipper and only one consignee. In practice, it means that the whole container is intended
for one consignee. FCL is intended to designate a container loaded to its allowable maximum weight or
volume, but FCL in practice on ocean freight refers to a single container booked by a shipper to transport
their cargo to simplify logistics and increase security compared to sharing a container with other goods.

II THE PROCESS OF FCL

STEP 1. Apply for import license

You should do this in advance and early, avoid the time and cost of storing containers at the port. It is best to
apply for an import license before loading the goods. Goods under the special management of the
Government such as:
+ Radio transmitters, receivers-transmitters;
+ Finished medicines, medical equipment, chemicals;
+ Industrial precursor, explosive precursor;
+ Plant protection drugs, plant varieties, wild animals and plants;
+ Veterinary medicine, animal feed, live aquatic products;
+ Vaccines, medical biologicals; insecticidal chemicals and preparations;
+ Bactericidal used in household and medical fields and medical equipment, cosmetic products;
+ Stamp. 
Details of goods subject to import license, search in Decree 187 and other relevant provisions.

STEP 2. Conduct the procedures of payment obligations

A letter of credit is a document sent from a bank or financial institute that guarantees that a seller will receive
a buyer's payment on time and for the full amount. It is often used within the international trade industry.
For payment, the buyer has to open L/C:
+ Prepare document: Financial documents and request for L/C issuance
+ Transact with the issuing bank to make sure the LC was issued accurately and on time. Banks collect
a fee for issuing a letter of credit.

STEP 3. Charter and store freight (by the seller)

STEP 4. Contract for insurance

Goods transported by sea often face many risks. However, the carrier's liability is very limited and it is difficult
to claim compensation. Buying insurance, therefore, helps to protect the interests of the business when there
is a loss and create a sense of security in business. Buying import and export cargo insurance is also an widely-
accepted international commercial practice.
- The following list shows some main risks for importing merchandise:
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 FCL - FULL CONTAINER LOAD SHIPPING – GROUP 3

+ Risk of loss due to theft or larceny;

+ Risk of loss due to an accident;
+ Risk of loss due to poor management of the cargo;
+ Risk of loss due to acts of God or natural accidents; and
+ Risk of damage caused to third parties.
- The insurance process goes as follows:
+ Step 1: Contact the insuarance company;
+ Step 2: Fill in the insurance request form;
+ Step 3: The insurance company sends the insurance policy to the insurer;
+ Step 4: After reviewing the terms of the contract, the insurance company will sign for certification,
after that, the insurance company will send the premium bill for the service.
- The act of buying insuarance is specified in Law No.24/2000/QH10 of the National Assembly: Insurance
business.

STEP 5. Import customs clearance of goods

- In order for the goods to be qualified for import clearance, the obliged party must declare and submit
customs declaration form; submit and present documents included in the customs dossiers. The
documents required by customs broker is as follows:
+ Customs declaration form for import goods;
+ Commercial invoice;
+ Bill of Lading (BL);
+ Sales and Purchase contract;
+ Packing List;
+ Notice of goods on;
+ Import license;
+ Registration for state inspection of goods quality or notice of exemption from state inspection of
quality;
+ Certificate of origin.
- Basic process of customs procedures for imported goods is specified by General Department of
Vietnam Customs as follows:
+ Import information declaration (IDA);
+ Register import declaration (IDC);
+ Check the conditions for registration declaration;
+ Segmentation, inspection and clearance: When the declaration is registered, the system will
automatically divide into 3 streams: green, yellow, red;
+ Declaration of amendments and supplements in customs clearance.

STEP 6. Take delivery of goods from means of conveyance

The shipper or the obliged party who is responsible for the delivery of goods must ensure that the goods reach
the buyer. The buyer, in return, is responsible for taking the delivery from the delivery party.
- Preparations prior to the departure of the ship:
+ Before the ETA: Gather information about the ship and prepare necessary documents.
+ Upon receiving the ETA: Prepare vehicle to pick up the goods and registration for testing,
quarantine, quality control and inspection.
+ Upon receiving NOR (Notice of Readiness): Exchange B/L (Bill of Lading ) for D/O (Delivery Order).
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 FCL - FULL CONTAINER LOAD SHIPPING – GROUP 3

- Process of receiving goods for full container cargo (FCL):

+ Receive Arrival Notice (A/N), bring B/L (Bill of Lading ) and Office’s letter of recommendation to get
delivery order (D/O);
+ D/O confirmation;
+ Receiving container at container yard;
+ Unloading goods from the container: At container yard/at the warehouse;
+ Return the container.

STEP 7. Quality inspection, quarantine and inspection of goods

A commercial assessment only involves the buyer and the seller of goods, not the management of the
department of customs, and the samples sent for inspection may or may not be under the control of the
department of customs.
- This step is pursuant to the Government's Decree No.132/2008/ND-CP (December 31, 2008), which
details the implementation of a number of articles of the Law on Product and Goods Quality.
- Application for quality inspection of imported goods:
+ Paper "Registration of state quality inspection of imported goods";
+ Copies of the following papers: Contract, Packing list;
+ Certificate of quality;
+ Other relevant documents: Bill of Lading, Invoice, Import license, Certificate of Origin (C/O),
Certificate of free sale (CFS).
- The inspection agency shall conduct the inspection according to the following contents:
+ Check the completeness of the application for registration of quality inspection of imported goods;
+ Checking the results of conformity assessment, conformity marks, labels (for goods requiring
labeling) and documents accompanying products and goods to be inspected;
+ Checking the written approval according to the regulations of the Ministry of Science and
Technology for imported goods on the List of goods.

STEP 8. Complaints
- Time for complaints is specified in Law of Commercial of Vietnam 2005, Art. 318:
+ Complaint in quality, 3 months from the date of delivery;
+ Complaint in quantity, 6 months from the date of delivery; in the case of goods with a warranty is
3months from the date of expiration of the warranty period; 
+ 9 months from the date the violating party has to fulfill its obligations under the contract or in the
case of a warranty, from the date of expiration of the warranty period for the claim of other
violations.
- Identify the objects of the complaint.
- Complaint records:
+ Complaint letter;
+ Related documents;
+ Original legal documents;
+ Assessment certificate;
+ Loss calculation;
+ Claim;
+ Receipts for submiting complaint records.
- Resolve complaints.
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 FCL - FULL CONTAINER LOAD SHIPPING – GROUP 3

III ADVANTAGES AND DISADVANTAGES OF FCL

1. Advantages of FCL
- Shipping time is faster because there is no extra time at CFS warehouse like LCL.
- An FCL shipment tends to be more secure because it has exclusive rights to the entire container.
- FCL is cost-efficient for larger shipments due to taking advantage of scale.
- Shipping FCL is usually the better option for urgent shipments or for shipments that need to arrive
before a fixed date.

2. Disadvantages of FCL
- Shipping larger quantities means finding and paying for more inventory space.
- For small loads, FCL will probably be more costly.
- Large batch quantities may lead to inventory status.
- Delivering a full container means you’ll need equipment and personnel that can handle the job, which
not every factory has.
- When you ship FCL, delivery can get more complicated as you’ll be dealing with large shipments in
small windows of time.