Evidence Account

An evidence account is an umbrella agreement contracted between a Western
supplier and a government agency in a developing country (e.g., an
industrial ministry, or a provincial or state authority), which is designed
to facilitate reciprocal trade flows. The agreement stipulates trade
conditions between the Western firm, other independent firms designated by
it, and commercial organizations under the jurisdiction of the developing
country signatory. It also requires that the cumulative payment turnovers
for the trade goods, not payments of individual transactions, be balanced
in an agreed-upon proportion within a specified period of time (typically 1
to 3 years). Trade flows are monitored and financial settlements occur
through banks designated by the agreement's signatories.