On August 31, the President of the Republic of Poland signed the act of July 26 2000 amending the Civil Code Act (the code), which introduces regulations related to leasing to the code.
The introduction of the amendment was possible due to the aspiration of the Polish legislature to create a modern legal system, keeping up with the dynamic development of economic life in Poland. The new dispositions were drawn up on the basis of analyses of domestic and international lease practices and in line with the UNDROIT Convention on International Financial Leasing of May 28 1988.
The adopted definition of a lease sets out the following main characteristics:
- the constitutive lease obligations on the part of the lessor include the purchase of an asset and its conveyance for use to the lessee for a determined period. On the part of the lessee, the return of the asset's price;
- the lessee issues its consent as to the identity of the seller of the asset as well as to the contents of the purchase agreement itself;
- the purchase option is not a constitutive element of the lease contract (it is treated as an additional contractual clause);
- the adopted new legal construction of lease also encompasses the concept of sale and leaseback form; and
- financial and operational lease is subject to a common regulation.
The new regulations are in compliance with EU law and will become effective as of December 2000.