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Simple English definitions for legal terms
foreign bill of exchange
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A quick definition of foreign bill of exchange:
A foreign bill of exchange is a written order that one person gives to another person to pay a certain amount of money to a third person. It's like a check, but it can be used in different countries. There are different types of drafts, like a clean draft with no shipping documents, or a demand draft that is payable on demand. Sometimes, people are forced to join the military through a draft. To draft also means to write or compose something, or to recruit someone for a task.A more thorough explanation:
A foreign bill of exchange is a type of financial document that is used in international trade. It is also known as a foreign draft or international bill of exchange. The document is a written order from one person, called the drawer, to another person, called the drawee or payor, to pay a certain amount of money to a third person, called the payee or bearer.
For example, if a company in the United States sells goods to a company in Japan, the seller may use a foreign bill of exchange to receive payment. The seller would write the order for payment and send it to the buyer's bank in Japan. The bank would then pay the seller or their bank the specified amount of money.
Foreign bills of exchange are important in international trade because they provide a secure way for buyers and sellers to make payments across borders. They are also used in other types of financial transactions, such as letters of credit and international wire transfers.