(2)The purchase by a bank of bills of exchange from an exporter in a collection, or a method of payment or settlement by bills of exchange in a documentary L/C transaction.在托收结算中，银行从出口商处买入汇票；或在跟单信用证结算中，利用汇票结算的一种结算方式

(3)The transfer of a negotiable instrument to another party.议付工具转手至另一方的转换过程

★ 2.Definition of a negotiable instrument

a negotiable instrument is an unconditional promise or order to pay an amount of money that is easily transferable from one person to another. 议付工具是一种便于把确定金额的货币从一方转至另一方的无条件的支付承诺或命令

(1)full and legal title passes on delivery

(2)not necessary to give notice of transfer to the liable party债务人

(3)free from equities or defects in title of any previous holder

(4)good faith善意

(5)for value对价

★2.1.2 Chief Features of negotiable instruments

1.Negotiability议付性/流通转让性p26

(1)negotiation can be effected only by delivery转让 or endorsement背书 and delivery. 议付性体现在票据转让或背书的过程中

(2) negotiation gives the transferee(接受人) a right of action in his own name against the original promissor or acceptor Requisite in form 权利的让渡

(3) the transferee in good faith and for value can acquire a better title than that held by all his prior parties. 善意持票人应得到完整的票据权利

2.Non-causative无因性

票据一旦作成，票据权利和义务的执行就与票据原因相分离。如：票据的转让过程中，不需要调查票据原因是否合理、合法。

3.Requisite in form要式性

票据的形式必须符合法律规定，票据上的记载项目必须齐全并符合规定。只有形式和内容都符合法律规定的票据，才是合格的票据。

4.Literally determined content文义性

票据上权利的内容，完全依据票据上所记载的内容确定，不能进行任意解释或根据票据以外的其他文件来确定。

5.Presenting for payment提示性

票据上的债权人请求债务人履行票据义务时，必须向付款人提示票据，才能请求付给票款。持票人不提示票据，付款人不必履行付款义务。

★2.1.3Parties to a negotiable instrument p27 (HW)

1.出票人drawer

2.付款人payer/（受票人）drawee

3.收款人payee

4.承兑人acceptor

5.参加承兑人acceptor for honor

6.背书人endorser

以转让为目的在汇票背面签章并交受让人的人

7.被背书人 endorsee

背书的受让人

8.保证人guarantor

9.持票人holder

可能是收款人或最后的被背书人

10.holder in due course/bona fide holder正当持票人/善意的持票人

The instrument should be complete and regular on its face;

The instrument is before maturity and the holder did not notice its previous dishonor, if any;

The holder took it in good faith and for value;

The holder did not notice any infirmity in the instrument or defect in the title of the person negotiating it

11. holder for value付对价持票人

a person who possesses an instrument for which value has been given by himself or by some other person prior to him in forms of money, goods,or services.

2.1.4 Negotiable instrument laws

British law UK Bills of Exchange Act of 1882

US Uniform Commercial Code of 1962, Article 3

French and German law

Uniform law for Bills of Exchange and Promissory Notes of Geneva of 1930

Convention Providing a Uniform Law for International Bills of Exchange and International Promissory Notes and Convention Providing a Uniform law for International Checks United Nations 1988

Negotiable Instrument Law of People’s Republic of China

2.2 Bill of exchange

2.2.1Definition of a bill of exchange

2.2.2Contents of a bill of exchange

2.2.3Parties to a bill of exchange

2.2.4Classification of bills of exchange

2.2.5Acts relating to a bill of exchange

2.2.6The Roles and Advantages of a Bill of Exchange

2.2.1★Definition of a bill of exchange

section 3. bill of exchange act.1882.UK

A Bill of exchange is an unconditional order in writing, addressed by one person(drawer) to another(drawee), signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at a fixed or determinable future time a sum certain in money to or the order of a specified person or to bearer.

汇票的定义

汇票是由一人向另一人签发的，要求立即或定期或在可以确定的将来时间对某人或他指定之人或持票人支付一定金额的书面无条件支付命令。（英国票据法）

汇票是出票人签发的，委托付款人在见票时或在指定日期无条件支付确定金额给收款人或持票人的票据。（我国票据法）

2.2.2 ★Contents of a bill of exchange

1.Requisite items必须记载项目

Requisite items(一)

①The word “exchange”

②An unconditional order to pay

“Pay to the order of the Bank China the sum of thirty-five thousand US dollars.” is a valid bill of exchange.

“Pay to the order of the Bank China the sum of thirty-five thousand US dollars when the ship ‘Dongfeng’ reaches the port of New York.”

“We would be delighted if you would pay to the order of the Bank China the sum of thirty-five thousand US dollars.”

Requisite items(二)

③A fixed amount of money

1)Payable at a fixed amount

2)Payable with interest

interest rate should be specified to make the amount certain.

e.g. “payable at USD three hundred plus interest at 5% p.a.”

Requisite items(二)

3)Payable by installments

installment must be clearly stated

e.g. “At one month after date pay to the order of *** the sum of two thousand US dollars by ten equal consecutive monthly installments”

4)Payable according to an indicated rate of exchange

rate of exchange must be indicated

5)In money注明货币名称和金额，一般金额保留两位小数

Requisite items(三)

④Name of the payee收款人名称（汇票的抬头）

1)Restricted Order限制性抬头（不可转让）

a bill payable to a specified person only or to a specified person not negotiable/transferable

e.g. “pay to ***only”; “not transferable”

2)Demonstrative Order/indicative order指示性抬头（A为第一背书人）

a bill payable to a specified person or some other person designated by him

e.g. “pay to the order of A”; “pay to A(or order)”

3) Bearer order来人抬头

any person holding a bearer order can request payment

e.g. “pay to bearer”; not safe

《日》&我国不允许以此种抬头开立汇票

⑤Date of issue

to determine the expiry date and paying date;

make sure whether the drawer has disposing capacity

⑥Name of drawee

⑦The signature of the drawer

without the signature of the drawer or forged signature makes an instrument invalid.

if an individual is signing for his company, these words “For”, “On behalf of”, “For and on behalf of” and “Per pro” should prefix the name of the company

e.g. For ABC CO., London

(Signature)

John Smith, Manager

2.Relatively necessary items非必须项目

⑧Place of issue

⑨Place of payment

⑩Tenor付款期限

the time to effect payment; the due date or maturity date

indicated as “on demand or at a fixed or determinable future time”

3.Items at will可选项目

利息、利率及汇率（interest ，interest and exchange rate）

提示期限（Limit of time for presentation）

出票依据（Drawn Clause）

免作退票通知或放弃拒绝证书（Notice of Dishonor Excused or Protest Waived）

付一不付二

预备付款人（Referee in case of need）

① BILL OF EXCHANGE

Exchange for ③ USD15,277.00 ⑧ Shanghai ⑤ MARCH 1 2005 (Date)

⑩ At Sight of this FIRST of Exchange (Second of Exchange being unpaid) ② Pay to ④ the order of BANK OF CHINA the sum of ③ US DOLLARS FIFTEEN THOUSAND TWO HUNDRED AND SEVENTY SEVEN ONLY .

Value received

⑥ To: HABIB BANK LIMITED

P.O.BOX 888， .

⑨ DUBAI, U.A.E

SHANGHAI TEXTILES

COMPANY LIMITED

方之 ⑦

(Authorized Signature)

2.2.3 Parties to a bill of exchange p34

(1) The drawer

(2) The drawee

(3) The payee

(4) Acceptor

(5) Endorser

(6) Endorsee

(7) Holder

(8) Discounter

(9) Guarantor

Holder

Holder for value is the holder of a bill for which value has been given either by himself or by his prior parties; enjoys the same rights but is subject to the same defects in title, if any, of the transferor.

Holder in due course refers to a person who obtains the instrument through giving the value by himself; his rights over the bill will not be affected by the title defects of his direct prior party.

2.2.4 Classification of a bill of exchange

1.According to the tenor

Demand draft/ sight draft

Time/ usance draft

Payable at a fixed time after sight ( the accepting date)

Payable at a fixed time after date ( the issuing date)

Payable at a fixed future date/deferred payment bill

e.g. “at a fixed time after a B/L date”

2.According to whether commercial documents are attached thereto

clean draft

documentary draft

3.According to the drawer

Banker’s draft

trader’s draft

4.According to the acceptor

Banker’s acceptance

trader’s acceptance

5.Accommodation (Finance) bill of exchange 融资汇票

a bill of exchange that is signed by someone (the accommodation party) who promises to pay it to help another person to raise money

used for straight borrowing/financing transactions in which there are no related transactions

2.2.5 Acts relating to a bill of exchange

Issue

Comprises : 1）to draw and sign a bill;

2）to deliver it to the payee

According to the negotiable instrument law：

The bill should be complete in form stipulated by the negotiable instrument law in the place of issue；

By drawing a bill,the drawer engages that on due presentment the bill will be accepted and paid and that, if dishonored, he will compensate the holder。

Endorsement

The payee or holder signs on the back of the bill and delivers it to the endorsee

A valid endorsement should be an endorsement of the entire bill;

By endorsing an instrument,the endorser guarantee that on due presentment the bill shall be accepted and paid as specified.

Types ：

Special endorsement 记名背书/特别背书/正式背书/完全背书

Pay to the order of E Co., New York(the endorsee)

For A BC Co., New York (the endorser)

Signature (of the endorser)

2) Blank endorsement 空白背书

3) Restrictive endorsement 限制性背书

Pay to A only/not transferable/not negotiable/pay to A bank for account of B Co.

4) Endorsement for collection 委托取款背书（托收背书）

5) Endorsement for pledge质押背书

Presentation

Types

presentation for acceptance: a usance draft

presentation for payment: a sight/usance draft

Occasions on which bills must be presented for acceptance

Time bill after sight

Time bill after date

A time bill stipulates that it must be presented for acceptance

A time bill, payable at a place other than that of the drawee

Presentation must be made within the reasonable time.

The drawee sign on the face of bill, and deliver it to the person presenting for acceptance, by which the drawee shows his assent to the order of drawer

承兑（Acceptance）

Forms ：

the word “accepted”; date; signature of the drawee

Types ：

general acceptance: without any qualification

qualified acceptance:

1)a conditional acceptance

e.g.accepted payable providing goods in order; accepted payable at some place (local acceptance); payable at a longer time after date

2) partial acceptance

3) Local acceptance

4) Time acceptance

This act is usually performed by a third party called guarantor, who engages to pay on presentment for a sight bill and accept and pay at maturity for a time bill.

1)the guarantor stands for a debtor such as drawer, endorser,or acceptor and assumes his indebtedness to the holder

2)when the guarantor is compelled to pay, his right of recourse arises against the guaranteed and all the prior parties of the guaranteed.

付款（Payment）

Honor and dishonor

“Honor”

the process in which the drawee effects payment or acceptance when a bill is presented to him for payment or for acceptance.

Notice of Dishonor

an advising act taken by the holder to all endorsers about the dishonor in writing or in words

Recourse

In the event of a draft being dishonored, the holder in due course can sue every person who signed the draft prior to him.

Qualifications to exert and preserve the right of recourse:

Completeness in form of the draft

Presenting for acceptance and payment on the due time

Notice of dishonor拒付通知

Protest拒绝证书

图示

If any party in the chain writes “without recourse” on the draft when the draft is transferred to him, he is discharged from the liability and the party concerned has no right of recourse against him.

Protest

a formal legal procedure, which goes some way towards protecting the seller’s rights:

After a bill is dishonored and a notice of dishonor is given, the holder may hand the bill again to a notary party who will present it again to the drawee so as to obtain a legal proof of the act of dishonor. If it is dishonored again, the notary party then will draw a protest (which is an official certificate that evidences the dishonor and states why the protest is made) and return it to the holder together with the bill, against which the holder may exercise his right of recourse against the prior parties.

Discounting of bills of exchange

Discounting is to sell a time bill already accepted by the drawee but not yet fallen due to a financial institution at a price less than its face value.

Calculating formula：

D=Vхtхd/360 N= V- D

D:discount interest V:face value t:tenor d:discounting rate(n% p.a.) N:net proceeds

Creditworthiness:

Standing of the drawer and the accepter

Drawn clause showing the reason for issuing the draft

Exercises

1.The issue of a draft

A draft for USD 100,000.00 is drawn by The American Exporter Co.,Ltd, Tampa, Florida, U.S.A on the French Issuing Bank, Paris, France payable at 60 days after sight to the order of ourselves dated 15 May.2006 marked “Drawn under The French Issuing Bank,Paris, France L/C No.12345 dated 25 Feb., 2006.”

2.A draft indicates that “at 10 days from 11 may, 2006 pay to the order of A company…”, the maturity of the draft falls on ______ amount and net proceeds.

3.A draft is partly shown as follows:

exchange for GBP12,500.00

New York, 23 May 2006

at 60 days after B/L date 23/ May/2006 pay to the order of ourselves the sum of US dollars one thousand only.

Suppose the accepted draft was discounted on 23 may, 2006 by the collecting bank, Bank of Asia, London at the rate of 9% per annum.

Please calculate discount

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