Equipment leasing, also known as financial leasing, refers to leasing that substantially transfers all or substantially all of the risks and rewards associated with ownership of an asset. Ownership of the asset may or may not ultimately be transferred.
Article 237 of the Contract Law of the People's Republic of China provides that a financial lease contract is a contract in which the lessor purchases the leased property from the seller according to the lessee's choice of the seller ﹑ the leased property, provides it to the lessee for use, and the lessee pays the rent.
The usual practice of financial leasing is the lessor to purchase the lessee selected technical equipment or other materials, as a lease to the lessee, the lessee according to the contractual agreement to obtain the long-term right to use the leased goods, in the period of the lease, according to the contractual period of payment of rent, the lease expires according to the contractual disposal of the leased goods.