Guiding Opinions of Accelerating Development of the Financial Leasing Industry
· Document Number：No. 68  Issued by the General Office the State Council
· Area of Law： Foreign Economy and Trade
· Level of Authority： Regulatory Documents of the State Council
· Date issued：08-31-2015
· Effective Date：08-31-2015
· Issuing Authority： General Office of the State Council
· Status： Effective
Guiding Opinions of the General Office of the State Council on Accelerating Development of the Financial Leasing Industry
(No. 68  Issued by the General Office the State Council)
The People's Governments of all provinces, autonomous regions and municipalities directly under the Central Government; the ministries and commissions under the State Council; and the institutions directly affiliated to the State Council:
Over recent years, China's financial leasing industry has achieved significant development, with remarkable promotion of the market size and competitiveness of enterprises thereof. It has played an important role in promoting industrial innovation and upgrade, expanding the channel of financing for medium-sized, small and micro enterprises, leading the development of emerging industries, promoting economic restructuring, etc. But generally speaking, the coverage of the various sectors of the national economy by financial leasing and its market penetration rate in China are far lower than those in developed countries, and there still exist outstanding problems in the development of the financial leasing industry that the management system is unsuitable, that laws and regulations thereon are incomplete, that the development environment is not perfect, etc. To further accelerate development of the financial leasing industry, and to better bring into play the role of financial leasing in providing service for development of the real economy and promoting stability, growth, systemic transformation and upgrade of the economy, the following Opinions, with the approval of the State Council, are hereby raised:
I. General Requirement
1. Guiding ideology: In in-depth implementation of the spirit of the 18th National Congress of the Communist Party of China (CPC) and the 2nd, 3rd and 4th Plenary Sessions of the 18th CPC Central Committee, in earnest implementation of the relevant decisions and plans of the CPC Central Committee and the State Council, and in bringing into full play the decisive role of the market in the distribution of resources, the relevant laws and regulations and policy support system shall be improved, and in-process and follow-up supervision mechanisms shall be established and perfected, with a shift of the mode of development, and with establishment of a specialized, highly efficient, steady and well-regulated modern financial leasing system with complete support, with orderly competition and with international competitiveness, to guide financial leasing enterprises to provide service for development of the real economy, business startups and innovation by medium-sized, small and micro enterprises, systemic transformation and upgrade of industries, transfer of production capacities, etc, and to make contribution to developing an upgraded version of the Chinese economy.
2. Basic principles: Combination between the leading role of the market and government support shall be adhered to, with efforts focused on improving the development environment, to fully arouse the vigor and vitality of market players. Combination between development and regulation shall be adhered to, to guide enterprises to develop in accordance with law, in compliance with rules and in an orderly way. Combination between financing and assets leasing shall be adhered to, with promotion of the level of specialization, to provide service for development of the real economy. Combination between what is domestic and what is foreign shall be adhered to, and, while service is provided for the domestic market, overseas markets shall be vigorously developed.
3. Development objectives: By the year 2020, the coverage of the business of financial leasing shall have kept enlarging, and the penetration rate of the financial leasing market shall have been remarkably promoted and shall have become an important means for equipment investment and technology update by enterprises. Also by the year 2020, a number of leading enterprises that are outstanding in professional advantage, that are advanced in management and that are powerful in international competitiveness shall have basically formed; a unified, standard and effective in-process and follow-up supervision system shall have basically been established; the system of support by laws, regulations and policies shall have initially formed; and both the levels of the financial leasing market scale and competitiveness shall have ranked among the highest in the world.
II. Major Tasks
4. Reform of systems and mechanisms inhibiting the development of financial leasing:
Acceleration of promotion of streamlining of administration and devolution of power: There shall be further shift of the mode of management and simplification of the work procedure, to promote coordinated development of domestic and overseas financial leasing companies. Pilot free trade zones shall be supported in actively making exploration and launching pioneering operations and pilot projects in terms of financial leasing. No restriction of requiring a minimum amount of registered capital may be set on establishment of subsidiaries by financial leasing companies. Financial leasing companies shall be permitted to concurrently operate businesses of commercial factoring related to their main business operations.
Rationalization of the system of management over the financial leasing sector: Overall management of the financial leasing sector shall be strengthened, and a system of management over the financial leasing sector with unified management of domestic- and foreign-funded businesses and systems of in-process and follow-up supervision and control thereof shall be established, to realize unification in terms of the scope of operation, trade rules, supervision and control indexes, submission of information, supervision, inspection, etc. Various types of social capital shall be guided and regulated in entry into the financial leasing sector, private capital shall be supported in initiating establishment of financial leasing companies, and independent third-party service institutions shall be supported in investing in establishing financial leasing companies, to promote multiplicity of investors therein.
Improvement of management systems in the relevant fields: Management over qualification for operation in the relevant sectors shall be simplified, to reduce inhibition of development of financial leasing. Where import of leasehold property involves management of quotas, license, automatic import license, etc, under the premise that the lessee already has the relevant quotas, license or automatic import license, no additional qualification for purchase thereof by financial leasing companies shall be made. In accordance with the characteristics of financial leasing, application by financial leasing companies for license for trading in medical devices or for recordation thereof shall be facilitated. Except for circumstances otherwise stipulated by law or regulations, equipment obtained by lessees through financial leasing shall enjoy the same treatment as equipment purchased by them in terms of qualification accreditation. Financial leasing companies shall be supported in going through the formalities of registration of hypothecation or pledge of the relevant guaranties in transactions of financial leasing in accordance with law. Measures for management thereof shall be improved and innovated, to support operation of businesses of financial leasing. Management over transactions in motor vehicles and registration thereof shall be regulated, with simplification of the procedure for registration of transactions, to facilitate the processing of businesses by both parties in financial leasing. The system of registration of vessels shall be improved, and the procedure for recordation of border entry-exit of vessels shall be further simplified, to facilitate operation of the business of leasing of vessels by financial leasing companies. Where import or export of aircraft, vessels and large-sized equipment including ocean engineering structures by financial leasing enterprises registered in areas under special supervision and control by the Customs in the China (Guangdong) Pilot Free Trade Zone or the China (Tianjin) Pilot Free Trade Zone involves more than one Customs area, interregional delegation of supervision and control by the Customs shall be applied in accordance with the actual need of logistic distribution, under the premise of ensuring effective supervision and control and execution of the relevant existing taxation policies. In accordance with the relevant provisions, financial leasing companies with the will and conditions to be linked shall be included into basic databases of financial credit information, to realize financial leasing business credit information submission and inquiry.
5. Acceleration of development of financial leasing in key fields:
Active promotion of systemic transformation and upgrade of industries: Financial leasing companies shall be encouraged to actively provide services for major national strategies including the Silk Road Economic Zone and the 21st Century Maritime Silk Road Initiative, the Beijing-Tianjin-Hebei Coordinated Development Strategy, the Yangtze River Economic Zone Development Strategy, the Made-in-China 2025 Plan and the New-Type Urbanization Construction Plan. Financial leasing companies shall be encouraged to enlarge and strengthen themselves in traditional fields including aircraft, vessels and engineering machinery, actively develop markets of strategic emerging industries including a new generation of information technology, high-end equipment manufacturing, new energy, energy conservation and environment protection, and biology, and widen channels for investment in and financing of cultural industries. Financial leasing companies shall be encouraged to participate in construction of infrastructure facilities in urban and rural areas including public utilities, sewage and garbage treatment, environment treatment, broadcast and telecommunication, and farmland water conservation. In the fields of public transportation buses, taxis, office cars, etc, development of new-energy automobiles and support facilities by means of financial leasing shall be encouraged. Financial leasing companies shall be encouraged to support development of modern agriculture, and actively develop businesses of financial leasing oriented toward new-type agricultural operators including major grain production households, family farms and agricultural cooperatives, to solve the problem of insufficiency of funding for purchasing large-sized farm machinery, production equipment and processing equipment. Markets of leasing of consumer goods for resident households shall be actively and steadily developed, and financial leasing of family cars, home information equipment, durable consumer goods, etc shall be developed, to increase domestic consumption thereof.
Acceleration of development of services of financial leasing for medium-sized, small and micro enterprises: In providing goods and services meeting the characteristics of medium-sized, small and micro enterprises, financial leasing companies shall be encouraged to bring into play their advantages in convenience in financing, flexibility of time limits, financial optimization, etc. Establishment of financial leasing companies particularly oriented toward medium-sized, small and micro enterprises shall be supported. Exploration shall be made for developing services of financial leasing oriented toward individual entrepreneurs, to promote mass entrepreneurship and mass innovation. Cooperation between financial leasing companies and each of innovation parks, science and technology business incubators, public services platforms of medium-sized, small and micro enterprises, etc shall be promoted, and support to scientific and technological, innovative and entrepreneurial medium-sized, small and micro enterprises shall be strengthened, with widening of channels for financial leasing for medium-sized, small and micro enterprises.
Vigorous development of cross-border leasing: Manufacturers of engineering machinery, railway, electric power, civil aircraft, vessels, ocean engineering equipment and other large-sized and complete sets of equipment shall be encouraged to adopt the means of financial leasing to develop international markets, and develop cross-border leasing. Introduction of advanced equipment from abroad by means of financial leasing shall be supported, to increase import of high-end equipment, and to promote the level of domestic technological equipment. Financial leasing companies shall be guided to strengthen cooperation with overseas construction enterprises in operating businesses of overseas leasing of construction equipment, and to actively participate in construction of major transnational infrastructure projects. Overseas project contractors shall be encouraged to optimize the distribution of funding, equipment and other resources and innovate ways of using engineering equipment by means of financial leasing. Exploration shall be made for introducing the model of financial leasing of engineering equipment in the construction of China's foreign-aid projects. Financial leasing companies shall be encouraged to develop by “going global”, to actively develop overseas leasing markets. Financial leasing companies shall be encouraged to operate cross-border Chinese yuan businesses. Financial leasing companies with competitive advantages shall be supported in launching cross-border merger and acquisition, foster transnational financial leasing enterprise groups, and bring into play the role of financial leasing to support and lead development of international markets by Chinese enterprises.
6. Extension of support for innovation and development of financial leasing:
Promotion of innovation of operation models: Financial leasing companies shall be supported in integrated development with the Internet, and strengthening cooperation with financial institutions of banking, insurance, trust, funds, etc, to innovate business models. Experience of developed countries therein shall be used for reference, and financial leasing companies shall be guided to accelerate innovation of businesses and keep improving the design of product mix, structure of transactions, arrangement for rents, risk control, etc, to promote the level of services. Under the premise of controllability of risks, exploration shall be steadily made for enlarging the scope of leasehold property onto new fields of biological assets, etc. Financial leasing companies shall be supported in establishing specialized subsidiaries and special project companies in pilot free-trade zones and areas under special supervision and control by the Customs to operate businesses of financial leasing. Exploration shall be made for combination between financial leasing and the financing model of Public-Private Partnership (PPP).
Acceleration of development of support industries: Establishment of markets of leasehold property and secondhand equipment that are standard and regulated, and that operate in high efficiency shall be accelerated, and establishment of platforms for registration of and trading in leasehold assets of financial leasing companies shall be supported, with improvement of mechanisms for withdrawal of financial leasing assets, to liquidize remnant leasehold assets. Establishment of intermediary service institutions related to financial leasing shall be supported, and development of relevant industries of professional consultancy, technical service, evaluation and verification, assets management, assets disposal, etc that provide service for financial leasing companies shall be accelerated.
Promotion of core competitiveness of enterprises: Financial leasing companies shall be guided to define their market niche, and focus energy on developing particular fields with comparative advantages, to realize specialized, characteristic and differential development. The various types of financial leasing companies shall be supported in strengthening cooperation to realize mutual complementation of advantages. Merger, acquisition and reorganization of enterprises thereof shall be encouraged. Financial leasing companies shall be encouraged to operate businesses on the basis of appropriate leasehold property, adhere to combination between financing and assets leasing, and promote their capacity of whole-industry chain operation of financial leasing and assets management. Financial leasing companies shall be guided to strengthen construction of their risk control system and internal control system, actively make a use of modern technology including the Internet, the Internet of Things, Big Data and Cloud Computation to promote the level of operation management, establish and perfect their customer risk assessment mechanisms, steadily develop the aftersales leaseback business, and strictly control operational risks.
7. Strengthening of in-process and follow-up supervision and control of financial leasing:
Improvement of supervision and control mechanisms of the financial leasing industry: The responsibility of provincial-level People's Governments for territorial jurisdiction over supervision and control shall be fulfilled. Supervision and control targets systems and supervision and control grading systems shall be established, and financial leasing companies shall be encouraged to apply credit grading. Prevention of risks on the part of the financial leasing sector shall be strengthened. Means of supervision and control combining on-site supervision and control with off-site supervision and control shall be used. Supervision over key processes and acts of financial leasing companies to take money deposits, issue loans, etc that are in violation of law or rules shall be strengthened. For financial leasing companies that are found to have violated law or rules, they shall be required to make rectification or correction in a timely manner, or punishment shall be meted out to them. Risk monitoring, analysis and early warning shall be strengthened, to practically prevent regional and systematic financial risks. Checklists of abnormality of information submission by enterprises and the system of blacklisting thereof shall be established. Management over information submission by financial leasing companies shall be strengthened. Financial leasing companies shall be required to submit information in a timely and accurate manner through the national financial leasing enterprises management information system. Information-based means shall be used to strengthen in-process and follow-up supervision and control thereof. Mechanisms for interdepartmental communication and coordination in work shall be established. Information sharing and cooperation in supervision and control thereof shall be strengthened.
Bringing into play the self-regulation role of organizations of the financial leasing sector: Development of national self-regulation organizations of the financial leasing sector shall be accelerated. National self-regulation organizations of the financial leasing sector shall fulfill the functions of coordination, rights protection, self-regulation and service provision. Financial leasing companies shall be encouraged to join self-regulation organizations of the financial leasing sector. Development of self-restraint mechanisms of the financial leasing sector shall be strengthened, and financial leasing enterprises shall be encouraged to actively assume social responsibility, with vigorous promotion of international influence of the financial leasing sector.
III. Policy Measures
8. Development of the environment for business operation under the rule of law: The work of legislation on financial leasing shall be actively promoted, with promotion of the level of legislation thereon. Exclusive legislations on the financial leasing sector shall be made on the basis of research, and the system of regulation over financial leasing companies shall be established and perfected, with improvement of the system of protection of the rights to leasehold property in financial leasing. A standard system of registration of leasehold property in financial leasing shall be established on the basis of research, and the role of registration of leasehold property in financial leasing in risk prevention shall be brought into play. The order of the market of the financial leasing sector shall be regulated, with development of a favorable environment for fair competition therein. Development of the honesty and credibility system of the financial leasing sector shall be promoted, to guide financial leasing enterprises to be honest and trustworthy, and to operate business in accordance with law.
9. Improvement of financial and taxation policies: A fair policy environment shall be provided for enterprises to encourage them to adopt the means of financial leasing to conduct technological transformation and equipment procurement. Support for government procurement shall be strengthened, and governments at all levels shall be encouraged to purchase service of financial leasing in providing public service and promoting construction and operation of infrastructure facilities. Actual users of farm machinery that have obtained the farm machinery by means of financial leasing can enjoy subsidies for farm machinery purchase. Local governments shall be encouraged to make exploration for adopting such policy tools as risk compensation, rewarding and interest subsidies to guide financial leasing companies to strengthen support for medium-sized, small and micro enterprises. The relevant taxation policies on financial leasing shall be implemented, to promote healthy development of the financial leasing sector. For financial leasing contracts signed for operating businesses of financial leasing (including aftersales financing leaseback), they shall be taxable and be affixed with tax stamps in accordance with the total rental stipulated by them by analogy with tax items of loan contracts. Insurance institutions shall be encouraged to develop financial leasing insurance policies, and the scale and coverage of financial leasing export credit insurance shall be enlarged.
10. Extension of channels for financing: The various types of financial institutions of banking, insurance, trust, funds, etc shall be encouraged to strengthen support to financial leasing companies under the premise of controllability of risks. Financial leasing companies shall be actively encouraged to raise funds through securities markets, and eligible financial leasing companies shall be supported in raising funds by means of issuing stocks, securitization of assets, etc. Chinese-funded financial leasing companies shall be supported in making a use of external debts, and the external debt management policies of Chinese-funded financial leasing companies shall be adjusted. Procedures shall be simplified and restrictions on backflow shall be lifted, to support Chinese-funded financial leasing companies in trying out management with the system of registration in external debt bond issuance. Financial leasing companies shall be supported in launching cross-border financing business in the Chinese yuan. Financial leasing companies shall be supported in making a use of foreign exchange to import advanced technology and equipment, and commercial banks shall be encouraged to make a use of foreign exchange reserves to extend entrusted loans to support cross-border financial leasing projects. Research shall be conducted on investment of insurance funds in financial leasing assets. Establishment of funds of the financial leasing sector shall be supported, and private capital shall be guided to increase input therein.
11. Improvement of public services: Unified, standard and comprehensive statistics systems and assessment indicator systems of the financial leasing sector shall be gradually established, with improvement of methods for financial leasing statistics making, and with promotion of accuracy and timeliness of statistical data. Information sharing mechanisms shall be established on the basis of enterprise credit information announcement systems, etc, to strengthen exchange of statistical information. Systems of standardization of the financial leasing sector shall be established, with formulation of standards in terms of financial leasing transactions, etc, and with strengthening of application, publicity and implementation of standards, to promote the level of standardization and regularization of the financial leasing sector. Prosperity indexes of China's financial leasing sector shall be formulated on the basis of research, with regular issuance of reports on development of the financial leasing sector, to guide healthy development of the financial leasing sector.
12. Strengthening of development of human resources: Building of the capacity of employees with the financial leasing sector shall be strengthened, and eligible higher education institutions shall be supported in independently establishing the relevant disciplines of financial leasing. Enterprises shall be supported in organizing their employees to receive relevant training, with adoption of measures to promote the comprehensive quality of employees, to develop a batch of financial leasing human resources with international vision and professional capacity. Industrial associations shall be supported in launching the work of training, compiling textbooks, administering proficiency tests, generalizing experience, exchanging experience in business operation, etc. Efforts for publicity and popularization of concepts and knowledge about financial leasing shall be strengthened, to keep promoting influence of the financial leasing sector on society and also social awareness about it, and to create a favorable social atmosphere for development of the financial leasing sector.
All regions and all the competent departments concerned shall fully understand the important significance of accelerating development of the financial leasing sector, strengthen organization and leadership, perfect working mechanisms, strengthen interdepartmental coordination and joint operation between higher and lower levels, and coordinate promotion of development of the financial leasing sector. All regions shall, in accordance with these Opinions, and in light of the local realities, formulate on the basis of research schemes for specific implementation thereof, and specify policy measures, to ensure adequate fulfillment of the various tasks. All the competent departments concerned shall promptly formulate on the basis of research support policies and specific measures for assignment and division of tasks, to create a favorable environment for development of the financial leasing sector. The Ministry of Commerce, China Banking Regulatory Commission and other competent departments concerned shall strengthen coordination and closely cooperate with one another in jointly doing a good job of risk prevention. The Ministry of Commerce shall do a good job of management over the financial leasing sector, and shall join other competent departments concerned in conducting follow-up analysis, supervision and guidance of implementation of these Opinions. Any major matter thereof shall be reported to the State Council in a timely manner.
General Office of the State Council
August 31, 2015