Increased regulation for leasing to consumers

The proposal itself makes a number of specific references to leasing, with the scope of the CCD being extended to include “loans below €200 [including] all leasing agreements”. For our industry, the revised CCD will have far reaching implications for the day-to-day operations of leasing companies, particularly for those that were not previously subject to the CCD due to how the legislation was applied nationally. This extended scope which covers leasing agreements with the option to purchase, will fundamentally change the legal framework for leasing agreements across the EU.

If adopted in its current form, a number of lease agreements will be subject to common rules on a range of issues, including some like right of withdrawal provisions which are not straightforward or feasible for lessors from an operational perspective. In these instances, it is vital that our industry is vocal about the implications of these provisions where they are ill-suited to the specifications of the leasing industry and would negatively impact consumer choice.

In our response to the revised CCD, Leaseurope highlighted a number of key concerns. For one, there is a lack of evidence that leasing agreements in their current form are detrimental to consumers and thus that a change in the regulation around them is required. A “one size fits all” approach to consumer credit, as set out in the draft, would also create operational issues when applied to very diverse business models. Whilst we support the need to reduce over-indebtedness, the lack of proportionality in advice requirements in the current draft would ultimately lead to reduced financial inclusion. The knowledge/skills requirements are also not dependent on or in line with the complexity of the products being offered. Leaseurope is currently engaging with policymakers on these concerns and exploring how the revised CCD can be made more suitable for both our industry and consumers.