The history of leasing Essay
The history of leasing, 487 words essay example
The term leasing comes from English verb "to lease", which signify "to rent". Leasing, as a legal entity, was born in England in the mid-nineteenth century, with the rapid development of the industry where an important role in this has played railways industry. Owners of coal mines required wagons but did not have enough money to buy them, therefore, they came with an agreement that wagon producers to offer wagons in advance, and payment to be made gradually, as the achievement of market coal . Later, leasing contract was taken over and was expanded in the United States. US first leasing transaction occurred in 1877, when the company "Bell Telephone Comp" offered its subscribers the possibility to rent telephones for a long term, with the right to purchase at the end of the lease. Because of this course, the people from US had telephones faster than other countries in the world.
The first form of leasing as a necessity of obtaining a financial support appeared in 1950, also in USA, when the director of a food factory from California have received a profitable order but didn't had the opportunity to buy the necessary equipment to fulfill this order. At this point the director requested from a financial institution to buy the necessary equipment and immediately to lease them. After the successful transaction, this put the basis on the first legal entity specialized in leasing called United States Leasing Corporation.
After 1952, with the establishment of United States Leasing Corporation, leasing began to be used widely, particularly for rental of equipment. It followed involvement of banks, thus contributing substantially to the development of leasing operations, through specialized leasing companies.
In the normative acts of the Republic of Moldova, the term "leasing" dates from 1991, but the leasing contract has acquired its own rules just in 1996, by Law no.731 on leasing (now repealed) . Unofficially, however, there was a possibility of using this kind of contract before, until the apparition of the Civil Code of 1964, allowed to make any agreement, even if they were not regulated by law. In practice, such a contract was qualified as unnamed one or was assimilated with the lease.
The leasing market in Moldova is relatively young compared to the countries of the region. The first leasing company - "Mold Leasing" was found in 1989 and have the kind of lease that the company leased freezers and agricultural equipment. But most leasing companies have entered the Moldovan market since 2000 and currently is in direct competition with commercial banks on financing the purchase of automobiles. According to the National Bureau of Statistics for 2013, of the objects leased transport accounted for 84%, while machinery and equipment - 9%, buildings and special - 7% and other means - below 1%.
The fact that leasing companies in Moldova limit their activity to transport lease is due to market demand, while leasing of other products (for example, buildings) is reduced because the financial demands that most companies do not have.