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Legal tender is a medium of payment recognized by a legal system to be valid for meeting a financial obligation. Legal tender is variously defined in different jurisdictions. Formally, it is anything which when offered in payment extinguishes the debt. Thus, personal chequescredit cardsand similar non-cash methods of payment are not usually legal tender. The law does not relieve the debt obligation until payment is tendered. Coins and banknotes are usually defined as legal tender.
Some jurisdictions may forbid or restrict payment made other than by legal tender. For example, such a nepal forex trading dubai legal might outlaw the use of foreign coins and bank notes or require a nepal forex trading dubai legal to perform financial transactions in a foreign currency.
Generally, designation of a particular form of money as legal tender means "that the designated money is valid payment for all debts unless there is a specific agreement to the contrary". For example, vending machines and transport staff do nepal forex trading dubai legal have to accept the largest denomination of banknote.
Shopkeepers may reject large banknotes: Under the law, United States money as identified above is a valid and legal offer of payment for antecedent debts when tendered to a creditor. By contrast, federal statutes do not require that someone who is not a pre-existing creditor must accept currency or coins as payment for goods or services.
Private businesses may formulate their own policies on whether to accept cash unless state law requires otherwise. The right, in many jurisdictions, of a trader to refuse to do business with any person, means a purchaser nepal forex trading dubai legal not insist on making a purchase and so declaring a legal tender in law, as anything other than an offered payment for debts already incurred would not be effective.
The term "legal tender" is from Middle English tendrenFrench tendre verb formmeaning to offer. The Latin root is tendere to stretch outand the sense of tender as an offer is related to the nepal forex trading dubai legal of the English word "extend" to hold outward. Coins and banknotes may cease to be legal tender if nepal forex trading dubai legal notes of the same currency replace them or if a new currency is introduced replacing the former one. Individual coins or banknotes can be demonetised and cease to be legal tender for example, the pre-decimal United Kingdom farthing or the Bank of England 1 pound notebut the Bank of England does redeem all Bank of England banknotes by exchanging them for legal tender currency at its counters in London or by post regardless of how old they are.
Banknotes issued by retail banks in the UK Scotland and Northern Ireland are not legal tender, but one of nepal forex trading dubai legal criteria for legal protection under the Forgery and Counterfeiting Act is that banknotes must be payable on demand, therefore withdrawn notes remain a nepal forex trading dubai legal of the issuing bank without any time limits.
In the case of the euro, coins and banknotes of former national currencies were in some cases considered legal nepal forex trading dubai legal from 1 January until 28 February Legally, those coins and nepal forex trading dubai legal were considered non-decimal sub-divisions of the euro. When the Iraqi Swiss dinar ceased to be legal tender in Iraq, it still circulated in the northern Kurdish regions, and despite lacking government backing, it had a stable market value for more than a decade.
This example is often cited to demonstrate that the value of a currency is not derived purely from its legal status [ citation needed ] but this currency nepal forex trading dubai legal not be legal tender. The Confederate currency became worthless by its own terms after the war, since it could only be redeemed a stated number of years after a peace treaty was signed between the Confederacy and the United States which never happened, as the Confederacy was defeated and dissolved.
Demonetisation is currently prohibited in the United States and the Coinage Act of applies to all US coins and currency regardless of age. The closest historical equivalent in the US, other than Confederate money, was from towhen the government banned most private ownership of gold bullion, including gold coins held for non- numismatic purposes.
Now, however, even surviving pre gold coins are legal tender under the act. Nepal forex trading dubai legal and coins may be withdrawn from circulation, but remain legal nepal forex trading dubai legal. United States banknotes issued at any date remain legal tender even after they are withdrawn from circulation.
However, Bank of England notes that are withdrawn from circulation generally cease to be legal tender but remain redeemable for current currency at the Bank of England itself or by post.
All paper and polymer issues of New Zealand banknotes issued from onwards and 1- and 2-dollar notes until are still legal tender; however, 1- and 2-cent coins are no longer nepal forex trading dubai legal in Australia and New Zealand.
A cashless society describes an economic state whereby financial transactions are not conducted with money in the form of physical banknotes or coins, but rather through the transfer of digital information usually an electronic representation of money between the transacting parties. However this article discusses and focuses on the term "cashless society" in the sense of a move towards, and implications of, a society where cash is replaced by its digital equivalent — in other words, legal tender money exists, is recorded, and is exchanged only in electronic digital form.
Sometimes currency issues such as commemorative coins or transfer bills may be issued that are not intended for public circulation but are nonetheless legal tender.
An example of such currency is Maundy money. Some currency issuers, particularly the Scottish banks, issue special commemorative banknotes which are intended for ordinary circulation.
As well, some standard coins are minted on higher-quality dies as 'uncirculated' versions of the coin, for collectors to purchase at a premium; these coins are nevertheless legal tender. Some countries issue precious-metal coins which have a currency value indicated on them which is far below the value of the metal the coin contains: In Australiathe creation of legal tender, in the form of notes and base metal coins, is the exclusive right of the Commonwealth Federal Government.
According to section of the Australian Constitution nepal forex trading dubai legal, "A State shall not coin money, nor make anything but gold and silver coin a legal tender in payment of debts. These, however, although having the status of legal tender, are almost never circulated or used in payment of debts, and are mostly considered bullion coins. Australian notes are legal tender for all amounts, as established by the Reserve Bank Act The one cent and two cent coins have been withdrawn from circulation since February but remain legal tender.
Although the Reserve Bank Nepal forex trading dubai legal and the Currency Act establishes that Australian banknotes and coins have legal tender status, Australian banknotes and coins do not necessarily have to be used in transactions and refusal to accept payment in legal tender is not unlawful. It appears that a provider of goods or services is at liberty to set the commercial terms upon which payment will take place before the "contract" for supply of the goods or services is entered into.
If a provider of goods or services specifies other means of payment prior to the contract, then there is usually no obligation for legal tender to be accepted as payment. This is the case even when an existing debt is involved. Australia Post prohibits the sending of coins or banknotes, of any country, except via Registered Post.
Nepal forex trading dubai legalnotes in circulation in Australia consisted of bank notes payable in gold coin and issued by the trading banks, and Queensland Treasury notes. Bank notes circulated in all States except Queenslandbut were not legal tender except for a brief period in in New South Wales. There were, however, some restrictions on their issue and other provisions for the protection of the public.
Queensland Treasury notes were issued by the Queensland Government and were legal tender in that state. The Australian Notes Act prohibited the circulation of state notes as money, and the Bank Notes Tax Act imposed a tax of ten per cent, per annum, on "all bank notes issued or re-issued by any bank in the Commonwealth after the commencement of this Act, and not redeemed". The Reserve Bank Act expressly prohibits persons and states from issuing "a bill or note for the payment of money payable to bearer on demand and intended for circulation".
In general, Canadian dollar banknotes issued by the Bank of Canada and coins issued under the authority of the Royal Canadian Mint Act are legal tender nepal forex trading dubai legal Canada. However, commercial transactions may legally be settled in any manner agreed by the parties involved with the transactions.
In the case that no mutually acceptable form of payment can be found for the tender, the parties involved should seek legal advice. As outlined in the Currency Act, there is a limit to the value of a transaction for which one may use only coins. In the case of coins of a denomination greater than ten dollars, a payment is a legal tender for no more than the value of a single coin of that denomination. Where more than one amount is payable by one person to another on the same day under one or more obligations, the total of those amounts is deemed to be one amount due and payable on that day.
In the People's Republic of China, the official currency Renminbi serves as the unlimited legal tender for all transactions. It is by law that any public institution or individual must not refuse using the currency to settle public or private domestic owing. Euro coins and banknotes became legal tender in most countries of the Eurozone on 1 January Although one side of the coins is used for different national marks for each country, all coins and all banknotes are legal tender throughout the eurozone.
Therefore, it is possible to find Irish euro coins in Greece and Finnish euro coins in Portugalfor instance. Although some eurozone countries do not put 1 cent and 2 cent coins into general circulation prices in those countries are by general understanding always rounded to whole multiples of 5 cent1 cent and 2 cent coins from other eurozone countries remain legal tender in those countries.
Due to variations on the legislative meaning of legal tender in various member states and the ability of contract law to overrule the status of legal tender, it is possible for merchants to choose to refuse to accept euro banknotes and coins within specific countries within the Eurozone the Netherlands, Germany, Finland and Ireland.
Legal tender was enacted the first time for gold and silver coins in the French Penal Code of art. Inlegal tender was extended to all notes of the Banque de France. Anyone refusing such monies for their whole value would be prosecuted French Penal Code art. According to the Economic and Monetary Union Act, of the Republic of Ireland which replaced the legal tender provisions that had been re-enacted in Irish legislation from previous British enactments, "No person, other than the Central Bank of Ireland and such persons as may be designated by the Minister by order, shall be obliged to accept more than 50 coins denominated in euro or in cent in any single transaction.
The Decimal Currency Act, governed legal tender prior nepal forex trading dubai legal the adoption of the euro and laid down the analogous nepal forex trading dubai legal as in United Kingdom legislation all inherited from previous British lawnamely: The Indian rupee is the de facto legal tender currency in India.
The Indian rupee is also legal tender in Nepal and Bhutanbut the Nepalese rupee and Bhutanese ngultrum are not legal tender in India. Both the Nepalese rupee and Bhutanese ngultrum are pegged with the Indian rupee.
Inthe Indian rupee was made the sole official currency of the Straits Settlements, as it was administered as a part of India. Inthe British replaced the Indian rupee with the Straits dollar after administration of the Straits Settlements separated from India earlier in that same year. After partition of India and Pakistan inthe Pakistani rupee came into existence, initially using Indian coins and Indian currency notes simply overstamped with the word "Pakistan".
New coins and banknotes were issued in This creation of a separate currency was an attempt to reduce the strain put on India's foreign reserves by gold smuggling. Two states, Kuwait and Bahrain eventually replaced the Gulf rupee with their own currencies the Kuwaiti dinar and the Bahraini dinar after gaining independence from Britain in andrespectively.
On 6 JuneIndia devalued the rupee. To avoid following this devaluation, several of the states using the rupee adopted their own currencies. Only Oman continued to use the Gulf rupee untilwith the government backing the currency at its old peg to the pound. Oman later replaced the Gulf rupee with its own rial in On 8 NovemberPrime Minister Narendra Modi announced that existing INR and INR banknotes would no longer be accepted as legal tender with a view to curb counterfeiting, tax evasion and the parallel economy.
New Zealand has a complex history of legal tender. English law applied, as applicable to local circumstances, from either 6 Januarywhen the Governor of New South Wales by proclamation annexed New Zealand, or from 14 January when Captain Hobson Royal Navy was sworn in as Lieutenant-Governor.
The English Laws Act subsequently confirmed that English legislation passed prior to 14 January was and had been the law of New Zealand, as applicable to local circumstances.
Unusually, untilthe Reserve Bank did not have the right to issue coins as legal nepal forex trading dubai legal. Coins had to be issued by the Minister of Finance. The history of bank nepal forex trading dubai legal was considerably more complex. Inthe Union Bank started issuing bank notes under provisions of British law, but these were not automatically legal tender. Inordinances were passed making the Nepal forex trading dubai legal Bank banknotes legal tender and authorising the government to issue debentures in small denominations, thus creating two sets of legal tender.
These debentures were circulated but were traded at a discount to their face value because of distrust of the colonial government by the settler population.
Inthe Ordinance was disallowed by the British Colonial office and they were recalled, not without first causing a panic among holders of the debentures. Inthe Colonial Bank of Issue became the only issuer of legal tender.
Inhowever the Colonial Bank of Issue was disbanded and through the Paper Currency Actthe Union Bank was confirmed once again as an issuer of legal tender.