Importance of Letter of Instruction
Delegation of Authority
The SLI enables the agent or freight forwarder to act on behalf of the exporter in order to deliver the goods. The freight forwarder handles all information regarding port, marine insurance, and duties.
Essential information on commodities of goods
The SLI covers all necessary details about the goods loaded in the cargo. In addition, the SLI also allows the freight forwarder to have an idea about the weight, destination, and origin of the shipment. In the absence of SLI, the freight forwarder cannot handle the shipment.
Efficiency and effectiveness
The SLI is undoubtedly an effective document. Its primary goal is to provide smoothness to the workflow. In addition, it passes all the shipping duties to the freight forwarder, reducing the Shipper's involvement in the processing of the order.
Filling of Letter of Instruction
The Letter of Instruction must be duly filled by the exporter guiding the freight forwarder in processing the order. After filling in the details, the exporter forwards it to the agent to process it in accordance with the details and terms mentioned in the SLI.
Details to Fill In Shipper's Letter of Instruction
Listed below are the details which must be duly filled in by the exporter.
Shipper and Consignee
While drafting the Shipper's Letter of Instruction, the details of the exporter (Shipper) and importer (consignee) must be filled accurately.
Destination points
The starting point where the goods are supposed to be loaded, to the destination points where the goods need to be delivered, must be duly filled in the SLI.
Details of Goods
The exporter must fill out the details of goods, such as weight, packaging, and description, before sending it to the agent.
Details of Parties
The details of all the parties, including in the shipment process, such as ultimate consignee, intermediate consignee, forwarding agent, and license number, must be duly filled in the Shipper's letter of Instruction.
Case Study
Liabilities of Freight Forwarder
Generally, an employer is held vicariously liable for the act done by an employee in the course of the employment. However, in relation to the agent/independent contractor and principle, all the liabilities of wrongful acts belong to the contractor. Hence, the freight forwarder would be held liable for all the inconvenience caused to the exporter or the third party.
The necessity of SLI for Export
The Shipper's Letter of Instruction is an essential document granting power and permission for the freight forwarder in order to act as an agent in terms of exporting the goods. However, SLI is not a legally binding document which requires the agent to carry it while discharging his duties. Nevertheless, the dependency of SLI may differ as per the norms and rules of other countries.
Conclusion
The freight forwarder utilizes the information contained under the Shipper's Letter of Instruction for various purposes, such as locations from where the goods are leaving to the destination where they arrive. In addition, the Shipper's Letter of Instruction provides agents with an acquaintance of the dimension and weight of the cargo. Moreover, the Shipping's Letter of Instruction can also be regarded as a one-time power of attorney ensuring the exporter performs due diligence to the freight forwarder.
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