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Open account means that payment is left open to an agreed-upon future date. It is
one of the most common methods of payment in international trade and many large
companies will only buy on open account. Payment is usually made by wire transfer
or check. This can be a very risky method for the seller unless he has a long and
favorable relationship with the buyer or the buyer has excellent credit. Still, there are
no guarantees and collecting delinquent payments is difficult and costly in foreign
countries especially considering that this method utilizes few official and legally
binding documents. Contracts, invoices, and shipping documents will only be useful
in securing payment from a recalcitrant buyer when his country's legal system
recognizes them and allows for reasonable (in terms of time and expense)
settlement of such disputes.
Titany answered the question on November 25, 2021 at 11:24
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