Finance Lease Legal Issues

Unlike any form of transaction that occurred in the past, modern financial leasing, originated in1950s in the United States, is the new-type finance method that is based on the legal ownership and the economic ownership of the material. As a new financial model, modern financial leasing has not only combined financing with leasing-assets, but also taken account of the dual characteristics of finance and trade; it shows a strong vitality and good prospect for development since its emergence. Financial leasing legal relationship breaking through the traditional ownership theory of civil law, transcending the inherent range of property rights, it has formed a kind of relationships between rights and obligations, which the core is credit ownership, and parties to the tripartite formed this complex and asymmetric relationships through two contracts, and this, in essence, is equal. However, throughout financial leasing in the course of development in China, it is not difficult to find that legal assistance and perfect law system is the essential condition of the development of financial leasing. Currently, the government yet loosened its policy of private finance experimental work, it undoubtedly can provide relaxed policy environment and financial support for finance leasing development. Only this is an opportunity to complete the financial leasing legal system.Unlike any form of transaction that occurred in the past, originated in1950s in the United States, modern financial leasing is the new-type finance method that is based on the legal ownership and the economic ownership of the material. As a new financial model, modern financial leasing has not only combined financing with leasing-assets, but also taken account of the dual characteristics of finance and trade; it shows a strong vitality and good prospect for development since its emergence. Financial leasing legal relationship breaking through the traditional ownership theory of civil law, transcending the inherent range of property rights, it has formed a kind of relationships between rights and obligations, which the core is credit ownership, and parties to the tripartite formed this complex and asymmetric relationships through two contracts, and this, in essence, is equal. However, throughout financial leasing in the course of development in China, it is not difficult to find that legal assistance and perfect law system is the essential condition of the development of financial leasing. Currently, the government yet loosened its policy of private finance experimental work, it undoubtedly can provide relaxed policy environment and financial support for finance leasing development. Only this is an opportunity to complete the financial leasing legal system.On such background, it is particularly important to dissect the legal relationship of financial leasing in the view of jurisprudence, and to promote the research of financial leasing. This paper is to proceed from the legal character of financial leasing, in-depth analyses the rights and obligations of the parties in financial leasing transactions according to the development contexts and the legislative process of our finance leasing, lay stress on deal with the ownership differentiation power of financial leasing and the ownership protection of the lessors, as the basis for the assessment of the relevant provisions of the Draft of the Law on Financial leasing of PRC. This paper puts forward the opinion on perfection of lease registration system, lease ownership, Retrieve possession system, and regulatory issues. This paper is divided into four parts:Part I. Basic theory:Legal analysis. This part sorts and sums up the different views of financial leasing legal characters exist in theoretical circles; analyses financial leasing.Part II. Extraterritorial experiences:Drawing lessons from foreign finance legal system. Analyzing the legislative models, regulatory strategies, lease range and registration system adopted by other countries (the United States, Japan, South Korea, Germany, Spain etc.) during financial leasing development.Part III. The status quo and insufficient of our financial leasing, and to comment the Draft of the Law on Financial Leasing of PRC. Firstly, the paper grasps the changes of our financial leasing system from macro-level, indicates that the low rank of existing laws and regulations, and each department acting on its own divided policies from various sources, it is difficult to manage our system comprehensively, coordinately and uniformly, which may harmful to financial leasing; meanwhile, there are also some problems on the ownership protection of lessors and regulatory system. Secondly, this paper indicates the position that legislation of our finance system that are leading up to the Draft of the Law on Financial leasing of PRC is the trend of times. Finally, this paper makes an assay of cohesion and breakthrough of the Draft of the Law on Financial Leasing of PRC and existing laws and regulations, then points out the outstanding issues.Part IV. Perfection of the system:Constructing financial leasing system. Recommendations on special legislation, definite lease ownership, regulation system and registration system perfection and the introduction to recover possession mechanism.