Navigating the complexities of international shipping requires a thorough understanding of the necessary documentation. One such document is the Shipper’s Export Declaration (SED). For many businesses, dealing with the paperwork involved in cross-border shipping can be overwhelming.
However, understanding the purpose and requirements of the SED can simplify the process significantly. In this article, we’ll explain what an SED is, what it includes, its purpose, and provide tips to avoid common mistakes when preparing this critical document.
What is a Shipper’s Export Declaration (SED)?
The Shipper’s Export Declaration (SED) is a form that provides export statistics and controls certain exports. It’s also known as U.S. Department of Commerce Form 7525-V.
It is required for shipments valued over $2,500 or those that need an export license. This document is crucial for both the exporter and the U.S. government, as it helps monitor and regulate goods leaving the country. By ensuring that all necessary information is accurately reported, businesses can avoid potential fines and delays.
What is Included in an SED?
Listed below are some of the most critical pieces of data required in the SED:
Exporter Information
This includes the name, address, and contact details of the exporter. Accurate information here is vital for ensuring compliance and for any follow-up that may be necessary.
Consignee Information
The name and address of the consignee (the person or entity receiving the goods) must be included. This helps both U.S. and foreign customs officials track the shipment.
Description of Goods
A detailed description of the goods being shipped, including quantity, value, and weight. This information is essential for classification and duty assessment.
Harmonized Tariff System (HTS) Code
The Harmonized Tariff System (HTS) Code is a standardized numerical method of classifying traded products. Using the correct HTS Code is crucial for ensuring compliance with international trade regulations.
Country of Destination
The final destination of the goods must be specified. This helps in assessing export controls and restrictions.
Export License Number
If applicable, the number of the export license must be included. Some goods require an export license due to their nature or destination.
What is the SED Used For?
The SED serves several important purposes:
Export Statistics
The U.S. government uses the data provided in the SED to compile export statistics. This information helps in understanding trade patterns and making informed policy decisions.
Export Controls
The SED ensures that shipments comply with U.S. export regulations, which are designed to prevent illegal exports and safeguard national security.
Customs Clearance
Accurate information on the SED helps facilitate the customs clearance process in both the exporting and importing countries, reducing the risk of delays.
Internal Transaction Number (ITN)
The Internal Transaction Number (ITN) is a number that is assigned to the shipment that confirms the Automated Commercial Environment (ACE) has accepted the Electronic Export Information (EEI), and it is on file. A shipper must have a valid ITN before the cargo is delivered to the ocean carrier’s port when shipping internationally.
Three abbreviations in one sentence is impressive – or excessive depending on your perspective – but such is the nature of international shipping documentation.
AESDirect Filing
To help improve the ease of data collection and its accuracy, the Automated Export System (AES) was developed for the electronic collection of shippers’ export declaration information which in turn converted shipper’s export declaration to the EEI – which is filed on AES.
The result, is the paper version of the SED has been declared as void and has been replaced by EEI.
How to create an AESDirect Filing
Setting up ACE Account
The first step is to procure an ACEÂ user identification and password. ACE is a filing tool and is the primary way for exporters to submit their EEI on the AES.
Logging into ACE
Once the exporter’s account is created, they need to log into the ACE account and accept the certification statements of AESDirect.
Filing through AESDirect
The exporter can either directly login from the Customs and Border Protection (CBP) website or make use of export documentation and compliance software.
Uploading of Data on AESDirect
The last step for the exporter is to fill in all the information fields accurately before submitting it.
Tips, Tricks, and Common Mistakes
To ensure a smooth shipping process, follow these tips and avoid common mistakes when preparing an SED:
Use a Customs Broker
While it is possible to do one’s own customs declaration, it’s highly recommended not to fill out the SED (now the EEI) internally. Instead, lean on the experts in clearing freight internationally with a reputable customs broker.
They will coach you through all the forms and submit them on your company’s behalf. By employing a customs broker you also have a resource that will facilitate those shipments that are stuck in the process of clearing either your export or import.Â
Ensure Completeness
Fill out all required fields on the SED form. Missing information can lead to delays, fines, and even the rejection of your shipment. Double-check that all sections are complete and accurate before submission.
Correct HS Codes
Using the correct Harmonized System (HS) codes for your goods is essential. Incorrect codes can result in misclassification, leading to incorrect duties and potential legal issues. If you’re unsure of the correct HS code, consult a trade expert or use online tools provided by customs authorities.
Timely Submission
Submit the SED on-time to avoid penalties. Timely submission is crucial for meeting export deadlines and ensuring that your shipment is not held up at the border. Aim to submit the SED well before the shipment date to allow time for any necessary corrections.
Once filed, the SED is valid for 150 days.
Stay Updated
Export regulations can change frequently. Regularly check for updates to ensure that your SED complies with current laws. Subscribe to newsletters from trade authorities or join industry associations to stay informed about regulatory changes that may affect your shipments.
Conclusion
The Shipper’s Export Declaration is a critical document in the international shipping process (for a couple of others, check out our recent pieces on commercial invoices and certificates of origin). By understanding its purpose and requirements, businesses can ensure compliance with export regulations, avoid delays, and contribute to accurate trade statistics.
Preparing an accurate and complete SED not only facilitates smoother shipping but also helps safeguard your business against potential legal issues. Stay diligent, double-check your information, and keep informed about regulatory updates to ensure a hassle-free shipping experience.
At InTek Freight & Logistics, Inc., we’re here to assist you with all your shipping documentation needs, ensuring your goods reach their destination smoothly and efficiently. With our expertise and commitment to excellence, we can provide the support you need to ensure your shipments arrive on time and in good condition. Whether you’re shipping domestically or across borders, we’re dedicated to helping you succeed.
Just fill out our Request a Quote form – or Talk to Us below – and we’ll be in touch to talk solutions before you know it. For more information about InTek, or logistics and supply chain issues in general, check out our Freight Guides.
