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We enabled cash on delivery for UAE only and 2checkout for all countries. When I select UAE as billing adress and shipping adresss as different place in UAE then both payment methods are showing. But problem when I select different country as billing address and UAE as shipping adsress at that time only 2checkout is showing. I am using lotusbreath one page checkout.

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For my knowledge Magento will work like that only.

The Drop down options you see in backend will work for Country selected in Billing address only not for shipping address

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