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Hello, Sir.
I am confused about who is the payee and drawee in bills of exchange and letter of credit. I mean who is the seller and who is the buyer. Please explain this.
Thank you!
I am sorry I should have written “drawer” instead of “drawee” in the title of of my question.
It’s not always a question of seller and buyer, but it could be. It is always a payer and a receiver
Let’s keep it simple and have you buying goods from me .. so you are going to pay me and I’m going to receive payment from you
In the context of CISG, it’s buyer (you) and seller (me)
A bill of exchange is simply a payment that is deferred for a period of time so, continuing with you and me, you are going to pay me by way of bill of exchange whereby you are instructing your bank to pay me money into my bank account in, say, 90 days time (13 June)
So you send me a piece of paper that you have signed, addressed to your bank, instructing the bank to pay into my account on 13 June the amount that you owe me
So you are the drawer, your bank is the drawee and I am the payee
Role play this with 2 friends – it might become clearer
OK?
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