Earlier, payment for exports was to be received from the overseas buyer named in the Export Declaration Form (EDF) and currency of such payment should be as per the final destination of the goods/services irrespective of residential status of the buyer.
Similarly, payments for import should be made to the original overseas seller of the goods and importer needs to satisfy that goods equivalent to remittance have been imported.
With a view to liberalize the procedure relating to payments for exports/imports and taking into account evolving international trade practices, Reserve Bank of India has incorporated third-party exports and third-party imports vide circular A.
A third party is someone who is not one of the main people involved in a business agreement or legal case, but who is involved in it in a minor role. Any individual who does not have a direct connection with a legal transaction but who might be affected by it.
A third-party beneficiary is an individual for whose benefit a contract is created even though that person is a stranger to both the agreement and the consideration.
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