How about Current Situation of Finance Leasing in China？

A summary of the current situation of finance leasing in China is shown in following five key messages. Be possessed of legislative frame; three types of leasing companies are available; four categories of business are in existence; five surrounding industries there are and two different assessments emerge.
 
1. Be possessed of legislative frame
The minimum limit of laws and regulations is possessed in China and finance leasing transaction is no longer being lack of legal base. For example Chapter 14 Finance Lease Contract covers the essential rules and R&O for parties. Accounting Standard for Business Enterprises 021 --- Leases covers the accounting treatment and the disclosure of related information. As to the supervisions, the Regulation of Leasing Business with Foreign Investment promulgated by MOFCOM covers finance leasing companies with foreign investment; the Regulation of Financial Institution Lessors promulgated by CBRC covers Financial Institution Lessors. Taxation act for leasing business is basically perfected. 

2. Three types of leasing companies are available
For historical reason, three types of finance leasing companies are in existence, i.e. finance leasing companies with foreign investment licensed and supervised by MOFCOM; financial institution lessors licensed and supervised by CBRC; and domestic pilot finance leasing companies licensed and supervised jointly by MOFCOM and STB.

Finance leasing companies, which emerge most early, were one of the windows to introduce foreign capital fund in China. Nearly at the same time PBOC approved financial institution lessors. According to government's commitment at joining WTO, finance leasing business in WOFI is opened to the outside world in December 2004. Meanwhile finance leasing business is opened to domestic capital and pilot finance leasing companies with domestic investment emerge in December 2004.  

3. Four categories of leasing business are in existence
The current solutions of finance lease in the world are put into practice with successful stories in China. Four categories of leasing business are in existence: direct finance leasing; captive leasing; vendor leasing and project leasing. Expanding solutions of direct finance leasing, for example, sales leaseback; joint leasing; cross-border leasing (including import and export) have successful stories in so far.  

4. Five peripheral industries there are
With rapid growth of finance leasing business, peripheral industries, which serve for and rely on finance leasing business, emerge. Major of the peripheral industries are professional network; training companies; exhibition companies; lawyer offices; consulting services including blocks.

5. Two different assessments emerge.
Domestic experts consider that finance leasing industry in China has been for four stages and a certain extent of development has been gained. Foreign experts consider that finance leasing industry in China is only in the embryonic stage and can not be ranked into “emerging market”.