My Freight Forwarder Is Requesting A Shipper’s Letter of Instruction, Now What?

Clients who export often ask us for guidance on whether to complete a Shipper’s Letter of Instruction (SLI). It’s important for our readers to understand the benefits of correctly completing the SLI provided to you by your freight forwarder.

The main benefit of an SLI is federal regulatory compliance! Prior to your goods being exported, Foreign Trade Regulations require a freight forwarder to transmit certain information to U.S. Customs and Border Protection on your behalf. To efficiently gather the required authorizations to act on your behalf and the information needed to be transmitted, the trade community developed a SLI.

What is a SLI?

• A SLI is a ‘letter’ from the exporter instructing the freight forwarder on how and where to handle the export shipment. The exporter is granting permission to the freight forwarder to act as the authorized forwarding agent for U.S. export control and customs.
• SLI is not a mandatory document or a legally binding document.
• SLI is multi-purpose document to assist you in communicating information to the freight forwarder SLI is designed to avoid misunderstandings that can result in financial loss to the exporter - or to the freight forwarder so it is vitally important that this document be accurate.
• A SLI is strictly used to gather information about your cargo to ensure your goods are exported in compliance with Foreign Trade Regulations.

What information and authorizations are obtained when you complete the SLI?

• You provide data for your freight forwarder to report Electronic Export Information (“EEI”) when you instruct your freight forwarder to file EEI on your behalf.
• You authorize your freight forwarder to transmit to the Automated Export System (“AES”).
• You provide information and instructions for documentation and billing.
• You provide transportation instructions your freight forwarder.
• You provide your freight forwarder consent to screen when you instruct your freight forwarder to screen on your behalf.

Why do we require a SLI?

• Consistently formatted information.
• All instructions and data on a single document.
• More efficient processing.
• Freight Forwarders no longer need to search through numerous, challenging, multi-page commercial documents to find relevant data elements.
• Allows for more accurate AES reporting Record keeping and provides back-up to the EEI filing.

Why should you complete a SLI?

• Avoid misunderstandings between the exporter and the freight forwarder and other parties involved in the shipping transaction.
• Secure method of providing the correct information to your freight forwarder.
• Establishes a best practice for your firm.
• You have a written record of who receives the shipping documents, who to contact for questions, who to contact for proof of export, and who issued the export control documentation that supports the decision to send your products to your foreign customer.
• New to the export industry and need guidance on export requirements.
• Unfamiliar with export control requirements.

Need guidance on completing the SLI? 

The best way to comply with export requirements is to have an expert by your side. Diaz Trade Law specializes in compliance with Foreign Trade Regulations, CBP, and other regulatory government agencies. For information on SLIs, contact us at 305-456-3830 or via email at info@diaztradelaw.com.