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What is Shipper's Letter of Instruction: Meaning, format & more

Shipper’s Letter of Instruction (SLI) is a document issued by an exporter to logistic partners with details on how and where to ship a set of products. Here’s a complete guide on Shipper’s Letter of Instruction for Indian exporters.
shipper's letter of instruction
In the process of exporting a shipment from India, Shipper’s Letter of Instruction (SLI) is one of the key documents, which allows easy movement of products. Signed by the exporter, it contains detailed information on how to proceed with the shipment process, providing limited power of attorney to logistic partners for transportation.

What is a Shipper’s Letter of Instruction?

Shipper’s Letter of Instruction (SLI) is filed by an exporter and is issued to logistic partners such as freight forwarders, who handle movement of products on behalf of the exporter. The document is required to convey transportation and documentation instructions to logistic partners. It allows and permits the logistic partner to arrange for transportation of the products and for filing custom-related documents.

Importance of Shipper’s Letter of Instruction

SLI enables freight forwarder or agent chosen by the exporter to be the acting agent of the shipment. All shipping questions and actions regarding insurances, customs and post carriers are communicated to the freight forwarder. Post this, the responsibility of the shipment is on the freight forwarder during transit from origin country to the final destination country.

This document delegates authority to the freight forwarder or agent, as per the logistic partner, to act on behalf of the exporter. Without SLI, the logistic partner will not be aware of the details of the shipment, thus, delaying the process and leading to challenges in customs.

Did you know?

Freight forwarder is an agent or logistic partner who is responsible for the movement of products on behalf of the exporter. This includes pickup of products from exporter to delivery at the final destination or a specified location.

Shipper's Letter of Instruction format

The traditional version of an SLI allows exporters to document transportation instructions to the respective freight forwarder. However, a few exporters add additional information on SDL (Special Delivery Location) to the forwarder. Here’s the format of the traditional SLI1:

• Name and address of the exporter and EIN (Exporter Identification Number)
• Starting point and destination of the shipment
• Details of packaging and handling requirements.
• Description of the commodities: Quantity, weight and value of goods
• Details of following parties:
1. Ultimate consignee: A person or a party that acts as an end user of the product, in other words, customer.
2. Intermediate consignee: A person or party who acts as an agent for the delivery of the products to the importer or customer.
3. Forwarding agent: A person who handles and organizes the shipment and its proceedings on behalf of the exporter.
4. Inland carrier: A transportation line that carriers the shipment between ports and inland points.
5. Validated license number: Export license number.

How to fill Shipper's Letter of Instruction?

An exporter can fill and issue an SLI once the logistic partner has been finalized. The document contains the following details2:

1. Details of the consignee and shipper

When you are drafting an SLI, you require the details of the shipper (exporter) and the receiver (importer) of the consignment (product). The information needs to be accurate and up-to-date.

2. Notifying party:

If both the shipper and the receiver are working with a specific logistic partner, the details have to be mentioned in the notify portion of SLI.

3. Departure and destination:

The port of destination along with the quote of the logistic partner and transit details have to be included.

4. Special instructions:

If there are any specific instructions or guidelines like a) whether the cargo is non-stackable or not, b) Does it have to be shipped in a particular way c) Are there any specific instructions that need to be complied with – these details need to be added.

5. Signature and date:

This is the final part of the document, which requires signature of the exporter, along with the date on which the document was issued.
Like SLI, there are a few additional documents and licenses that are mandatory to export from India and ship products from India. For instance, Importer of Record, Packing List and Commercial Invoice are necessary to ship a range of products from India.
Once you have obtained the necessary documents required to ship your products, you can register and export via e-commerce.

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Frequently Asked Questions

Who is responsible for Shipper’s Letter of Instruction?
Exporter is responsible for the completion of Shipper’s Letter of Instruction (SLI), which is then sent to the freight forwarder or logistic partner.
Is SLI a legal document?
An SLI is a non-legal document. It enables exporters to communicate accurate information on shipment to the freight forwarder.
Why should you complete an SLI?
All export shipments require an SLI. Clear shipping instructions ahead of exports serve as a formal communication on shipment process and guidelines to handle the export consignment.
Is the shipper's letter of instruction mandatory?
The SLI is not a mandatory or legal document and depends on the foreign trade regulations and rules that are specific to each country. From the forwarder, it may serve as proof of purchase and an order form.
Published on May 5, 2022.

Sources:
1. https://images.ctfassets.net/vkoe68wv76dt/3kUhqBnkzsmT9R8oHbBHUa/3e7d97bf3b8fdcf322654d41f23dafe6/
Shipper_s_Letter_of_Instruction_Format_Template__1_.jpg
2. https://www.icecargo.com.au/shippers-letter-of-instruction/
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*Map not to scale. The map has been used for design and representational purpose only, it does not depict the geographical boundaries of the country. These do not conform to the external boundaries of India recognized by the Survey of India.

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