What Is an Export Declaration and Do I Need One?

David Noah | August 11, 2021 | Export Compliance, Export Basics
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What is An Export Declaration and Do I Need One? | Shipping SolutionsI frequently hear from people who need help using or finding an export declaration document, and I cringe! The export declaration they’re looking for—officially called the Shipper’s Export Declaration (SED)—shouldn’t be used for exports anymore.

Here’s why it should be avoided, and what to use instead.

What Is an Export Declaration?

For many years, the Shipper’s Export Declaration was one of the most important forms an exporter needed to complete. Required by the U.S. Foreign Trade Regulations (FTR), it needed to be printed on yellow—actually goldenrod—paper so that it would stand out from other export documents.

The Census Bureau required exporters to complete the SED for two primary purposes:

  1. To meet their obligation to collect data about U.S. exports, including the value of exports for every type of commodity.
  2. To help ensure compliance with U.S. export regulations requiring exporters to include export license information.

The FTR required exporters to complete the SED for shipments when the commodity's value exceeded $2,500 per Schedule B number and for postal shipments if the value was at least $500. SEDs were required, regardless of value, for all shipments that required an export license or for shipments to embargoed countries.

According to the Census Bureau, more than half of all SEDs that exporters submitted included errors, making accurate data collection difficult. In the mid-1990s, to improve the accuracy of the data as well as to improve the ease of data collection, the Census Bureau worked with what is now the Bureau of Industry and Security (BIS) and the State Department to unveil the electronic collection of SED information through the Automated Export System (AES).

At first, filing through AES was voluntary, but since September 2008, it’s been mandatory. The paper SED is no longer allowed, and new regulations increased the civil and criminal penalties for failing to file through AES or for filing incorrect information to a maximum of $10,000 per violation—a huge increase over previous penalties.

Make sure you know when and how to file through the Automated Export System (AES). Download the free white paper.

To this day, some exporters still use the SED as a shipper’s letter of instruction (SLI) for their freight forwarders. But they shouldn’t. The SED doesn’t provide all the necessary information for someone to file through AES.

Why You Should Avoid the SED

There are two very important reasons why you should no longer complete the Shipper’s Export Declaration:

  1. The Census Bureau won’t accept it. If the FTR requires that you submit your export information to the Census Bureau, you must submit it electronically through AESDirect, which is now located on the Automated Commercial Environment (ACE). Filling out the SED is a waste of time.
  2. If you are paying your freight forwarder or another third party to file through AESDirect, you may be using the old SED form as a shipper’s letter of instruction (SLI), so they have the data needed to file on your behalf. Unfortunately, the SED doesn’t include all the data fields required under the current Foreign Trade Regulations.

    In the best case, that means the forwarder must either contact you for the additional information, which may delay your shipment. In the worst case, the forwarder is making their best guess for the missing information, putting your company at risk for an incorrect AES filing. Remember, you are legally liable for the accuracy of the information they file.

Here’s What You Should Do Instead

Retire the SED forever and do your own AES filings.

Ideally, you should register for the Automated Commercial Environment (ACE) and directly file through AES yourself. We have written extensively about ACE and filing your export shipments through AES. Here are a few good jumping-off points:

Filing through AES isn't hard. You can log into the ACE portal and enter your electronic export information on the appropriate AESDirect screens, or you can use an export documentation software program like Shipping Solutions and simply click a button to file.

If you are reluctant to do your own AES filings because you think it will be too difficult, let us show you how easy AES filings can be.

Use the SLI in NCBFAA format.

If the FTR requires that you, as the exporter, must file through AES but you choose to hire a third party to file on your behalf, you must provide written authorization to that third party. This often comes in the form of a Shipper’s Letter of Instruction (SLI), a document produced by the exporter and given to the freight forwarder that outlines what is expected of the freight forwarder.

In this case, I suggest using the version of the SLI recommended by the National Customs Brokers and Forwarding Association of America (NCBFAA). This SLI includes specific line-item level product information that would allow the forwarder to file through AES. You can download a free version of the SLI in NCBFAA format here.

Shippers letter of instruction filled out - Shipping Solutions

In addition to using this version of the SLI, I strongly recommend that you ask your forwarder to provide you with a copy of the filing, so you can verify the information. As I mentioned above, you are legally liable for the accuracy of the information. Better yet, set up an ACE account, so you can generate your own reports of AES filings using your company’s tax ID.

What’s Next?

Using the right version of the export declaration form doesn't provide much help if you are entering the wrong information. Shipping Solutions export software guides you through the process of submitting your electronic export information through AESDirect and/or completing an SLI along with all the other export documents you may need. And it does it efficiently, so you never have to enter the same information over and over again as you complete the various forms.

Let us show you how Shipping Solutions makes it easy to create accurate export documents and file through the Automated Export System.

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