For more than 30 years leasing and renting have represented the two different types of contracts used by companies in Spain for the procurement of production and investment goods. Both contract types are explicitly defined in Spanish law. But the Spanish legislature models itself after the Anglo-American roll-model. Some of the laws do not deal directly with leasing and renting transactions. But, because they are directed at credit institutions in general, they also apply to leasing companies. This includes, for example, the law regulating credit institutions (Ley de Disciplina e Intervención de las Entidades de Crédito). There are also regulations in the commercial and civil code.In Spanish legislation, the document that is most similar to both leasing and renting contracts is the rental agreement (regulated in §§ 1.542- 1582 Spanish Civil Code). The operator has the right to use the leased object by paying agreed-upon periodic lease payments to the lessor/landlord, who is the owner of the financed object.

As far as accounting is concerned, leasing and renting have different advantages. Within the framework of a renting agreement the financed object is not part of the tenant’s fixed assets. The investment, therefore, does not increase the tenant’s liabilities. Furthermore, the tenant can deduct the rental rates from his or her taxes. Leasing is different. Here the investment object is part of the lessee’s annual statement. The financing part of the leasing rates can be accounted for as costs and deducted from taxes. The amortization part of the rates is entered into the profit-and-loss statement as depreciation.

Leasing and renting companies offer several prepared standard agreements, which the customer only has to agree to. Leasing and renting agreements can be signed privately or by a notary. In the latter case, the agreements are entered into the register of movable objects (Registro de Bienes Muebles) or, if the rented object is real estate, in the property register (Registro de la Propiedad).

The difficult legal framework requires comprehensive know-how. This is especially true when the leasing contracts cover tax, accounting and civil law matters. Deutsche Leasing offers its customers customized solutions and consultation in all questions regarding leasing & renting.