About Bills

1. what is a bill?

A bill is a negotiable instrument which is unconditionally committed by the drawer to pay a certain amount of money by himself or to entrust another person.

To grasp this concept, we need to understand from three aspects: first, the bill is a kind of negotiable securities, which has a certain amount of face value, and expresses ownership or creditor's right to property. Whoever owns the bill has the right to obtain the amount stipulated in the negotiable instrument on the basis of the bill, and whoever owns the company's stock will have the corresponding part of the company's property.

The generation, pfer and exercise of the right of the bill are based on its own existence. That is to say, the holder of the bill only gets the right to collect the bill only if he gets the bill. If he pfers the bill to another person, then the right to collect the money will also be pferred.

Second, a bill is a promise made by the drawer to pay a certain amount to the bearer.

When a drawer opens a bill, it must bear the obligation stipulated in the payment of the bill, and only when it pays the amount can the obligation be relieved.

Third, the payment commitment made by the drawee is unconditional, that is, the obligation of the drawer to perform the payment cannot depend on the occurrence of an event or the occurrence of certain circumstances or the precondition of an act.

That is to say, once a drawer has issued a bill, he must pay the prescribed amount at any time, no matter whether or not something or certain behavior happens.

How do we classify 2. bills?

What kinds of bills are negotiable in China?

According to the law of negotiable instruments, bills of exchange include bills of exchange, promissory notes and cheques.

Negotiable instruments can be classified from different angles.

The notes are classified according to the time of payment and can be divided into spot notes and forward bills.

A spot bill means that a drawee must pay immediately to the holder, such as a cheque and a bill payable on demand, after sight.

A forward bill is a bill payable by a drawee at a specified time or at a specified date after sight.

According to the way the payee records, bills can be divided into registered bills and bearer notes.

A registered bill refers to a note indicating that the name of the payee can be pferred by the endorser of the payee and that the payer can only pay the payee or his designated person.

Bearer notes refer to bills which are not recorded on the face of the payee and can be pferred directly through the delivery of the instrument without endorsement. The drawee can pay the bill to any bearer.