instrument normally used in international commerce to effect payment; also calledbill of exchange. It is simply an order written by an exporter (seller) requesting an importer (buyer) or its agent to pay a specified amount of money at a specified time. The person or business initiating the draft is known as themaker, drawer, ororiginator, The party to whom the draft is addressed is thedrawee
payment order in writing directing a second party, the drawee, to pay a specified sum to a third party (the payee). A draft is actually a bill of exchange, although the term draft is ordinarily used if drawn on a bank. A check is a bank draft payable when presented (a sight draft). Drafts may also be payable at a future date (a time draft).
- order in writing, directing a person other than the maker specified sum to a named person. Drafts may or may not be negotiable instruments. depending on whether the elements of negotiability are satisfied. Draft is synonymous with bill of exchange.
- preliminary form of a legal document; for example, the draft of a contract, often called rough draft.
- process of preparing, or drawing, a legal document, such as a will or a piece of proposed legislation.
- in a military context, conscription of citizens into the military service.
signed, written order by which one party (drawer) instructs another party (drawee) to pay a specified sum to a third party (payee). Payee and drawer are usually the same person. In foreign transactions, a draft is usually called a bill of exchange. When prepared without supporting papers, it is a clean draft. With papers or documents attached, it is a documentary draft. A sight draft is payable on demand. A time draft is payable either on a definite date or at a fixed time after sight or demand.
