What is a Shipper’s Letter of Instruction (SLI) and Do I Need One?
Whether you are exporting a shipment via air freight or ocean freight, you may be requested to provide a Shipper’s Letter of Instruction (SLI). An SLI is an optional, yet extremely important document that provides specific instructions from US exporters to their agents (often freight forwarders). There are three primary benefits to completing an SLI:
To consolidate transportation and documentation instructions — clearly indicating who the exporter is, where the freight is moving to, and the full description and value of the goods.
To summarize export control and reporting information — allowing US Customs authorities to control exports and compile trade statistics.
To designate authorization to the agent allowing them to carry out necessary steps to coordinate the shipment including the transmission of Electronic Export Information (EEI) to the Automated Export System (AES).
The best reason to accurately complete an SLI is to avoid misunderstandings between the shipper and the forwarder that can lead to financial losses. Having all the necessary details and instructions consolidated in the SLI makes any export more efficient and compliant.
Consolidate Instructions
An SLI is a standardized form from the exporter to the freight forwarder specifying how and where to handle the shipment being exported. It provides specific instructions to the forwarder about how the goods are to be transported.
Export Control and Reporting
Beyond providing goods information and instructions for the shipment, the SLI is also utilized by US Customs and Border Protection authorities to control exports and compile trade statistics.
According to the World Trade Library, “Many nations impose strict controls on exports (e.g., high technology, armaments, and drugs) and use the SLI as a means of export control. Because many exports can be diverted to “unfriendly” nations and individuals, it is considered the responsibility of the exporter to know his cargo, destination, customer, end-use, and end-user.”
Designate Authorizations
A completed and signed SLI gives permission to the forwarder to act as the exporter’s agent to handle your export Customs and controls. It will include data the forwarder will need to submit EEI on your behalf through the AES. For this reason, it is extremely important that the SLI form is completed accurately and signed by an authorized representative. This will help ensure your goods comply with all Foreign Trade Regulations. This document will also include information and instructions for billing and other documentation.
Yes, You Need One!
While an SLI may not be mandatory, it is most certainly the clearest way to provide instructions for your shipment. Many freight forwarders may even reject the shipment if you are unwilling to complete the SLI since this creates risk exposure to both the exporter and the freight forwarder. Other reasons to complete an SLI are:
To avoid misunderstandings between the exporter, agent or forwarder, and other parties involved with the shipping transaction
It establishes a standardized, secure method for collecting, transmitting, and archiving information surrounding your exports — a written record of who issued export control documents and a contact for any inquiries
It creates a ‘best practice’ guide for exporters to follow to avoid any confusion and potential financial risk
Conclusion:
An SLI helps provide that peace of mind to ensure you have the information and tools you need to succeed. Please use the Juno’s SLI Form and Instructions.
If you find yourself in need of additional support, our team is always available to help. Juno is committed to being an extension of your company’s Logistics Department.