The regulatory framework for leasing development has been expanded in Belarus
16/06/20100 views
16 June, Minsk /Lilia Krapivina - BELTA/. The regulatory framework for the development of leasing in Belarus has been expanded. This is the aim of the Council of Ministers' Resolution No. 865, which approved the Regulation on Leasing, as reported to BELTA correspondent by the Chairman of the Belarusian Association of Lessors, Alexander Tsybulko, commenting on the document.
The Regulation governs the general economic and legal conditions and procedures for concluding, executing, and terminating financial lease (leasing) agreements, including economic operations related to the execution of these agreements. Now, relations concerning the transfer of property under a lease agreement are regulated by the Civil Code of the Republic of Belarus, this Regulation, unless otherwise established by the President, and other legislation adopted in accordance with them. Previously effective documents concerning leasing have lost their force.
The Regulation sets out the terms and definitions of leasing. Thus, the contract value of the leased asset is the value of the asset transferred under the lease, determined by agreement between the lessor and the lessee for the purpose of calculating lease payments, carrying out and reflecting economic operations during the execution of the lease agreement. It (the contract value) is reflected in primary accounting documents and includes, among other things, the lessor's expenses related to the acquisition of the goods that are the subject of the lease, including delivery, installation, and assembly. This asset must also be brought to a condition in which it is fit for use by the lessee.
Definitions of financial and operating leasing are provided. To establish the specifics of carrying out economic operations, leasing where payments during the lease term (at least 1 year) ensure reimbursement to the lessor of at least 75% of the contract value of the leased asset is defined as financial. Leasing where less than 75% of the contract value of the leased asset is reimbursed to the lessor is defined as operating.
The Government Decree also introduces new concepts: sale and leaseback and sublease. The lessee may act simultaneously within one agreement as the seller of the property transferred for lease (sale and leaseback). With the consent of the lessor, the lessee may transfer to a third party for possession and use for a specified period, for a fee, the property received from the lessor under the lease agreement and constituting the subject of the lease, by concluding a sublease agreement with the third party (sublessee).
The subject of the lease, the rights to it, and/or the lease agreement, subject to state registration in accordance with the legislation, are registered by the authorized state organization upon the application of the lessee.
The lessor has the right to control the lessee's compliance with the terms of the lease agreement regarding the preservation of the leased asset and its maintenance in working condition. The lessor also has the right to early termination of the lease agreement and return of the leased asset. Unless otherwise stipulated by the agreement, the lessee bears all expenses related to the return of the leased asset to the lessor, including the costs of its dismantling and transportation, and also compensates the lessor for other losses associated with the termination of the agreement.
The period for which the leased asset is provided for possession and use under a sublease agreement cannot exceed the lease period under the lease agreement. The termination of the lease agreement entails the simultaneous termination of the sublease agreement.
The lessor has the right to use the leased asset as collateral to secure the performance of obligations only under a loan agreement (borrowing agreement) concluded to pay for the leased asset, unless otherwise provided by the lease agreement. Risks and benefits associated with the transfer and possession of the leased asset are transferred to the lessee.
The Decree enters into force on July 1, 2010. The provisions of the document do not apply to lease agreements concluded before its entry into force. These agreements are valid for the period specified in them and are not subject to alignment with the requirements of Decree No. 865. However, by agreement of the parties to a lease agreement concluded before the Decree entered into force, the provisions of this document may also apply to such an agreement.-0-
BELTA