Vekselsettes

Vekselsettes is a term used in some Scandinavian languages to describe the act of transferring the rights under a veksel, or bill of exchange, from one holder to another. The concept is central to trade finance, where instruments that promise payment can be moved along a credit chain by endorsement and delivery. The endorsee becomes the new holder and is entitled to demand payment from the drawee or acceptor under the instrument.

Mechanism and practice. Transfer typically occurs through endorsement, a signature by the current holder on the back of the instrument or on a separate document, sometimes accompanied by delivery. Endorsements can be special (made to a named person or entity) or blank (creating a bearer instrument that can be further negotiated). A vekselsettes operation may involve multiple endorsements, allowing the instrument to circulate until payment is made or the instrument is dishonored. Endorsers may incur liability if the instrument is dishonored, depending on the type of endorsement and local law.

Legal framework. Bills of exchange and their transfer are governed by national negotiable instruments laws and, in international contexts, by widely recognized rules and guidelines such as the Uniform Rules for Bills of Exchange. These frameworks define rights and obligations of drawers, endorsers, endorsers’ guarantors, and the eventual holder, including issues of acceptance, payment, and defense against payment.

significance. Vekselsettes enables liquidity and credit transfer in commerce by allowing a payment obligation to be efficiently negotiable, discounted, or funded through banks and other financial intermediaries.