LEASEBACK-AN ALTERNATIVE SOURCE TO RAISE COMPANY WORKING CAPITAL

U ovom radu dat je opis, pravna regulativa i korišćenje povratnog lizinga, kao alternativnog načina povećanja obrtnog kapitala preduzeća sa širokim brojem i vrstom korisnika. Povratni lizing je doživeo eksplozivan rast u Evropi u prvoj deceniji ovog veka, pogotovo u godinama ekonomskog prosperiteta. Vrednost povratnog lizinga u Evropi je povećana od 6,9 milijardi evra u 2004. godini na 46 milijardi evra u 2007. godini, odnosno u toku četiri godine vrednost je povećana za 567%. Povratni lizing je, pokazale su analize, “idealan” način finansiranja po osnovu kupoprodaje i lizinga nekretnina. Dugoročno “zarobljen” kapital kroz povratni lizing postaje obrtni kapital spreman da bude angažovan u tekuće aktivnosti, odnosno projekte i programe preduzeća koji donose visoke prihode. Cilj ovog rada jeste da, na osnovu sveobuhvatnog teorijskog prikaza, empirijske analize i pozitivne svetske prakse skrene pažnju na, za naše uslove poslovanja, potpuno nov način finansiranja u kontekstu obezbeđenja dodatnog obrtnog kapitala kroz priliv kako domaćeg tako i stranog kapitala u Srbiju. Za potpunu primenu ovog načina finansiranja potrebno je prevazići niz ograničenja: pravna regulativa, razvijeni investicioni fondovi za ulaganje u nekretnine, urađen katastar nepokretnosti.


Introduction
The business of leasing emerged as the result of quest for new forms and sources of financing in the climate of a highly developed market of goods and capital, together with a high degree of development of technology, whose advent would not be possible by applying solely the classic, at that time current forms of financing and business operations. Leasing emerged in its present-day form during the 1950s in the U.S.A. In practice it proved to be a very convenient tool for companies to acquire equipment and other assets that they needed at the time when they were unable to purchase them for ready cash, or obtain such a credit facility from their bank.
The philosophy on which leasing construct is based starts with the concept that ownership is neither the basic nor the most important category for modern-day production and trade of investment goods, regardless of whether they are movable or immovable goods. This is a financing method where the companies with the shortage of capital for executing certain jobs see their chance to raise capital, but also the capital owners perceived this as a good opportunity for placement of their capital. Functioning in the circumstances that required fulfilling demands and needs of contemporary business, leasing arrangement gained such characteristics that have distinguished it, to the highest degree possible, from rental as the initial form, and turned it into a completely independent and particular form of business.
Economic logic of leasing lies in the fact that the users of equipment, machinery, industrial plants and similar, are not acquiring them through the classic manner of purchase but are renting them from the specialised leasing companies, or manufacturers. In this manner, leasing deals involve a number of organisations, such as production companies, specialised leasing enterprises, business banks, and leasing financing institutions, but also construction companies involved in real estate trade, trade servicing companies (public warehouses, transport firms) and similar. In brief, it can be said that participants in leasing operations can be divided into two groups: the first one are the business entities in need of investment funds, i.e. those in need of funds for purchase of machinery, transport vehicles and similar, and the other one, companies that produce investment goods and where leasing mode is opening opportunities for increase of sales.
Leasing business has found a broad spectrum of application in all the domains of investment activities and in such conditions acquired the features of financial operation, which in legal or contractual terms is characterised as such. Bearing in mind the intensity of its use, leasing has grown into an economic branch and has as such conquered the world becoming a very significant activity for a number of national economies.
Leasing did not develop as a business only within national borders but had gained a great importance, as a method of financing, within the international proportions. The volume of work based on leasing and the sphere of its application in business practice is on a constant growth. Reasons for such an expansion of leasing arrangements are many and sundry: first of all, it is the shortage of own funds, the need if own funds are available to keep them free for other purposes or engagement in some other field, but also extremely inauspicious fiscal policy in some countries where leasing emerged as a very convenient alternative. In addition, there are also adverse crediting terms, difficult conditions for placement of goods on highly competitive markets, and very importantly, in the climate with the high degree of development of modern technology, protection from the risk of early obsolescence of equipment that is in the highest number of cases the subject of leasing arrangements [I. Spasic, M. Todorovic, [8][9].
In the business and banking practice there are different kinds of leasing depending on the subject of a leasing arrangement, the length of rental, powers of the leasing beneficiaries, etc. Different models of leasing have emerged primarily due to the need, depending on the necessities and requirements of the leasing deal participants, to satisfy to the maximum the achievement of their objectives. Mindful of the fact that technically and technologically the most advanced capital assets -plant and equipment and the working capital must be provided at one and the same time, what emerged was the model of sale with the leaseback option, or a 'sale-and-leaseback' arrangement.

Grafikon 1. Povratni lizing
Sale and leaseback is a financial transaction where manufacturer or trading company, i.e. the owner sells investment goods to the leasing company, provided the manufacturer i.e. the former owner is leasing back the same goods from the buyer, i.e. leasing back the same goods under the leasing agreement (Graph 1).
Leaseback is a sub-group of financial leasing. Within the sales-purchase agreement, the subject (equipment) has not physically changed. Most often there is no physical transfer of assets and everything is solved through documents. In the leasing agreement, the seller (equipment manufacturer) assumes the role of the leasing beneficiary -lessee, while the buyer (leasing company) assumes the role of the lessor, who is purchasing equipment from the seller, i.e. manufacturer (supplier). Lessor in this arrangement is only a financier and most often must have funds available for financing the entire value of sale. The seller receives the agreed sale value, while the buyer obtains lease rentals.
Leaseback is one of the contemporary models of financing in the developed countries of the world and is used for financing of immovable and movable assets. Subject of a leasing arrangement is the asset of the lessee which is being temporarily sold to the leasing company. Leasing company grants the lessee the same asset for rental. Funds obtained through such temporary sale most often are used for expanding production range, and for making investments into new business activities.
Leaseback transactions are usually done for the capital assets, most of all for the real estate and in aviation for aircrafts, for vehicles and railways. The objectives of leaseback transactions are diverse, but usually: financing, corporate assets management and taxation benefits.
Example 1 -In March 2007, Air India announced its plan to enter into a leaseback agreement for 6 A-310 aircrafts in its fleet for a period of 20 years. The money obtained from the sale will be used as a boost to the working capital and will help repayment of credits necessary for purchase of 60 new Boeing aircrafts. At the time when this announcement was made, the airline received one offer of 78 million dollars with the leasing agreement prescribing a monthly rental in the amount of 247,000 dollars per aircraft. Rental was for a 5-year period. The sale and leaseback arrangement business will allow the company to increase necessary capital and at the same time to maintain the use of six planes [Dictionary].
Example 2 -In 2011, car manufacturing giant Mercedes Benz sold its Spanish HQ in the northern area of Madrid to a renown company Mapfre Inmuebles, for an amount of some 28 million euro in return for a rental yield of over 6% on a 10-year rental basis [Colliers,8].
Leaseback is mostly applied on a highvalue property such as buildings, hotels, and even entire factories which are being sold to the leasing company, thereupon used through lease rentals for a longer period of time. In this manner, the ownership risk exposure is transferred on to the buyer, while all the economic benefits from the use of the same are retained through leasing.
Example 3 -MWB Group Holdings PLC, a British hotel chain, sold its Malmaison Hotel with 80 rooms, situated in the city of Aberdeen (Scotland), to the first authorised real estate investment fund in the United Kingdom (Aviva Investors Property Trust) for a sum of some 16.1 million euro [Colliers,23].
Example 4 -Konzum, retail trade chain which in Croatia has more than 700 shops, holds between 20% and 25% of retail outlets in its ownership, while the rest is rented [Business].
Leaseback, as one of the manners of financing recognised by the developed market, which combines together both the advantages of rental and of ownership, is adjusting itself through different models to the wishes and abilities of the leasing beneficiaries -the lessees. Transposing immobilised assets into other forms of property, which bring higher yield rates, allows lessees to raise liquid funds that in turn allow for increase of profitability on investments in view of the fact that the received liquid funds can be used for investment into basic activities of the company. Upon expiry of the leasing agreement, the lessee has the opportunity to become again the legal owner of the leasing asset.
Leaseback is popular in the world with large-size companies, but also with the smallscale enterprises. Leaseback has particular importance for financing of the medium-size companies. In the years of economic prosperity, small and medium-sized companies were rather intent on using internal than the external sources of financing. In the period of the world economic crisis, the issue of financing in general was so much intensified that the following rule prevailed in short-term financing: those who are able to finance are also able to trade. Even in the field of medium-term and long-term financing the situation was not any better.
In the midst of recession majority of the capital markets was "closed down", so that it was very hard and in some cases even impossible for the small and medium-sized companies to secure banking financing on good terms and with favourable interest rates. However, after the recession, banks became much more cautious and prudent in their lending activities, and credits became more costly together with a much more complex procedure for crediting approval in respect to the period prior to the recession [B. Terrer].
Generally speaking, it may be concluded that for all the companies, leaseback is a sustainable, efficient and competitive manner of securing working capital, as only a small number of companies is not in need of cash flows for their regular business operations. Economic crisis showed that the sale and leaseback arrangement is increasingly viewed as a sound, sustainable alternative for raising cash flows. Research has shown that even some countries in transition, at the time of economic and financial crisis, when conventional forms of financing based on debt capital had become very costly, had to a great extent used sale and leaseback arrangements (for example, The Czech Republic).
In the post-crisis period, the climate was never better for the leaseback to show all of its advantages [CBRE2,2]. In an environment where the conventional forms of financing had become seriously constrained and too costly, leasing transactions, and gradually also the leaseback deals, came to embody a sustainable alternative for raising capital through business.
Leasing, as a manner of financing generally speaking, has a number of advantages, which are distinguishing it from the others: 1. Preservation of the lessee's capital. Lessee is not using his own capital to purchase new equipment as the leasing covers full price of equipment which is used in the business, providing in this manner a 100% financing. Lessee does not have to secure or pay either advance or partial payments. In this manner the saving in capital or financial resources can be used for other production purposes, for example, for financing stocks [R. Rani,232]. 2. Improved liquidity and cash flow planning.
Leasing allows the lessee to improve his liquidity position and plan with high probability his cash flows.

Provides flexibility and benefits for the lessee.
Leasing agreement may be adjusted to the leasing period and payment of lease rental in accordance with the benefits and requirements of the lessee. Leasing limits to a great extent, and very often even completely eliminates, the risk of technological obsolescence of equipment. Lessee is free to buy the right of use of the equipment, with the option of its replacement. 5. The absence of security. Lessor, in most cases, does not request from the lessee, future beneficiary of the subject of leasing, almost any particular security. The assessment of credit worthiness of the lessee pertains mostly to his potential for making profit and management abilities. Lessor, in actual fact, does not need any particular security as he remains the owner of the subject of leasing over the entire period of validity of the leasing agreement, and even thereafter if the subject is not transferred into the ownership of the lessee. Actually it is for the reason that additional security most often is not necessary, that leasing can be contracted in a much simpler fashion and more promptly than the classic banking credits (in an ideal case, even in only one single day). 6. Fixed rates of leasing rental. For the duration of the leasing agreement, as a rule, the rates are defined in fixed amounts, and depending on the manner in which this is regulated under the national legislation, it may have substantial fiscal and customs benefits. 7. Innovative manner of financing. Leasing boosts and instigates entrepreneurial actions and expands the scope of allocation for the means of production (capital). A particular characteristic of leasing is that it allows companies to keep a follow-up on the scientific and technical progress and advancement in a financially more appropriate manner, and offers the option of a faster implementation in the function of new but also expansion of the existing capacities. 8. Convenient manner of financing for the sector of small and medium-sized companies. As a form of alternative financing, leasing is especially attractive for small and medium-sized companies as it allows for the business startup without any major financial allocations for purchase of equipment, but also in cases when because of its price, some of the equipment is in actual fact out of reach of the lessee. 9. Offers a possibility of new borrowing. The lessee has the option of an easier and a more advantageous credit contracting, for example. 10. At times, the sole financing alternative. Leasing is the only economical option in case the beneficiary is in need of equipment or some other facility necessary for conducting business over the only one short period of time (one season), while the purchase of the same in this case would have definitely be a disastrous solution. 11. Provides security. Ownership of equipment and the simplified procedure of a leaseback offer the lessor security that is much higher than it would have been in case of any pledge that would be used for securing a bank credit.
In spite of its many advantages, leasing does have some of its drawbacks: 1. A high cost price. The basic drawback of the leasing arrangement is the fact that leasing is the most costly form of financing for purchase of equipment, technology and other goods. Lessor must collect from the lessee the entire amount of capital invested. Leasing price includes the following: purchase value of the asset that is subject to the leasing arrangement, interest, general costs related to the equipment purchase agreement and the leasing agreement, as well as the part of profit that the subject of leasing shall obtain [P. Lerman]. 2. Unfavourable taxation regime. Due to the detrimental customs and fiscal regime in the country, leasing may even prove to be an inauspicious financing model. 3. Disadvantageous position of negotiators. In many cases at the conclusion of the lease particularly pronounced economic inequality of partners may occure. In such cases, the lessor uses the stronger negotiating position in respect to the lessee offering him the leasing terms along the principle 'take it -or leave it', i.e. leaving no room for actual negotiations to take place. Yet in spite of all the above stated leasing advantages and disadvantages, the leaseback arrangements offer a number of advantages, mogu bez ograničenja da stvaraju dodatne obaveze po osnovu ranije dobijenih kredita ili poslova sa dužničkim hartijama od vrednosti. Ovo ograničenje rešava povratni lizing. Zakupnine kod povratnog lizinga obično se ne smatraju zaduženošću, tako da preduzeće može da zadovolji svoje potrebe za gotovinom pomoću povratnog lizinga bez narušavanja ranije sklopljenih ugovora. 6 Raising funds by means of leaseback offers owners of the assets (subject of leasing) a number of significant business advantages: 1. Prompt capital increase. Leaseback is one of the fastest ways for the owner of the capital asset to obtain the money, yet retain the asset for his business needs. The seller usually receives more cash money through the leaseback than from any conventional mortgage loans, for example. 2. Liquidity boosting. By applying the technique of sale and lease rental payment, lessee improves his current liquidity whose capital is blocked in "immobilized" capital assets, real estate, for example. 3. More attractive way of selling real estate. On an average, the final real estate prices are higher in respect to the classic sale of real estate. 4. Good assessment of one's own portfolio. The seller usually is able to structure the initial leasing terms over a forecasted period, without financial burden connected with the final payment of a high credit repayment rate, for example, monetary reserves liabilities, refinancing or other matter connected with conventional financing, together with substantial lowering of costs for the approval procedure. 5. Constraints of borrowing are avoided. In order to provide additional capital, companies can not without limitations create additional liabilities above the previously obtained credits or deals with debt securities. Such limitation is being solved by the leaseback arrangement. Rentals in case of leaseback are usually not regarded as indebtedness, so that the company can satisfy its needs for ready cash by means of leaseback without a breach to the previously contracted agreements. 6. Discourages the take-over of companies. An undervalued real estate in the accounting books of the company is often the target for attack of "predators". By a timely debt repayment, leaseback arrangement may serve as means for renouncement, as it provides funds for proper management capable of resisting the take-over. In addition, a long-term leasing deal is not an invitation to "predators", as an underrated real estate is. 7. Improves balance sheet. Leaseback allows the company to change often the structure of its debt maturity, from the short-term to the long-term ones. In addition, leasing compensations are being paid, in actual fact, from the revenues acquired by equipment which is the subject of leasing. It is usually said that the subject of leasing is repaying itself actually. 8. Steering clear of borrowing money on loansharking interest rates. As the leaseback is not deemed to be a credit facility, state legislation on loan-sharking does not apply, which means that the buyer, through the leaseback, may provide a higher rate of return than if he had granted a classic mortgage loan to the owner, for example. Sellers (owners of the subject of leasing) when deciding whether to raise funds through the leaseback, should take into consideration its drawbacks as follows: Leaseback has many advantages for the buyer as the sustainability of the leaseback often depends on the potential effects on the buyer. Properly structured leaseback arrangement provides for the buyer a number of advantages and benefits: 1. Higher rate of return. The buyer usually receives a higher rate of return through the leaseback deal than from the conventional credit arrangement. In addition, the buyer is also in the position to circumvent state laws that limit high interest rates in conventional financing. Furthermore, at the end of leasing term, the buyer gains benefits from any assessment of the assets. Finally, buyer can use so obtained assets for a mortgage loan for the new business operation and can additionally increase return on his invested money. 2. Predictability and secure rate of return. Net long-term leasing allows the buyer to estimate precisely rate of return in the future. In addition, an extended leasing term secures for the buyer the protection from the fall on the real estate market and protection from inflation, on the assumption that the property value will increase over time. 3. The buyer finds it easy to set himself free from the seller in his defaulting manipulations. In case the seller fails to service his liabilities, the buyer may simply terminate the leasing agreement. The risk lies in the fact that the buyer may encounter problems with finding some other seller. 4. The option of obtaining ownership upon return of assets to the primary owner. The buyer has a higher interest for the assets, subject of leasing. If the buyer has the option to renew the lease, this may postpone or limit the time which the buyer deems to be a profit potential. The buyer is also bearing the risk of the asset value falling during the contracted leasing term. 5. Embedded lessee. Finally, for the purchase of assets (real estate or some other capital asset) the buyer has an embedded lessee, i.e. the seller.
Although there are significant advantages in the leaseback deal for the buyer, in the deliberation of the leaseback arrangement drawbacks must be taken into account: 1. Possibility of insolvency (delay in servicing liabilities) of the seller. The greatest danger for the buyer is the situation when the seller becomes insolvent in the leasing deal.
If the seller files for bankruptcy, the buyer is deemed to be general creditor. In case the arrangement is a conventional one (for example, a loan), the buyer shall be deemed to be an insured creditor. If the seller is to file for bankruptcy on a falling real estate market, the buyer may encounter some difficulties in finding a new buyer. 2. Higher administration costs. A typical leaseback transaction must be so structured that it complies with the specific needs and requests of both counterparties, which may require more time and higher administrative costs in respect to the conventional credit arrangements. 3. Mandatory asset management. In most cases the seller undertakes the obligation of continuous asset management for the period of the leasing deal duration. However, the buyer must be assured that the seller is making timely payments of the property tax and makes some changes in tax liabilities whenever possible. The buyer also must periodically re-examine property insurance and control its proper maintenance. Finally, if we are to draw a parallel between financing through borrowed funds (debt financing), primarily long-term credits and leaseback arrangements, we would note differences that are substantial and the given characteristics affirm the leaseback deals (Table 1).

Leasing regulatory framework and the leaseback agreement
Leasing is a business deal where the lessor grants for use the subject of leasing deal (most often it is either equipment or entire production plant, that he produces himself or supplies them from some other person) to the lessee transferring on to him the right of use of such equipment for an agreed period of time. Lessee, while economically using the equipment over an agreed period, pays the lessor an adequate compensation. When the leasing term expires, the lessee either returns the equipment or extends the leasing agreement for a subsequent period of time (usually with a lower rental fee), or repurchase the equipment [I. Spasic, M. Todorovic, 7].
Leasing business, as an economic activity, is implemented through the leasing agreement as a legal and technical tool. Leasing agreement is such a legal action where the lessor undertakes to grant the lessee (recipient) the right to a temporary use (deployment-rental) of a certain object where he is bound to perform certain actions in connection with such use, while the lessee undertakes to pay the compensation (lease rental) in the contracted instalments and upon the expiry of the contracted term, to return the object of leasing to the lessor, or extend the use of the same, or rather to purchase the object of the leasing agreement [S. Nenadovic, 207].
Leasing agreement is a mixed contract which contains elements of several other legal transactions, such as the rental contract, sales agreement, credit agreement, contract for supply of a service, service contract, and similar. Therefore, leasing arrangement is a specific economic construct made out of not less than two, and often even several different contacts. The significant elements of a leasing agreement are the following: contracting parties, subject of the leasing agreement, i.e. the object that is being leased for use, the price charged for use of the leasing object (rental price), manner of fixing rental price and terms of payment, period of 2. Amortisation is mostly done from 25 to 35 years, but with 10-year higher instalments than the previous ones.
2. Initial leasing period may be from 15 to 25 years, but with equal instalments.
3. Does not provide financing without guarantees which may cause higher interest costs, or without the option for replacement of the financing source.
3. Guarantees renewed option that may be negotiated in advance, for extension of term from 5 to 50+ years.
4. Repayments are mostly fixed and not negotiable for purpose of matching with the cash flows.
4. May be structured with low initial leasing instalments, to be gradually increased over a period of several years, which maximizes cash flows. 5. Balance sheet type of debt borrowing.
5. May be structured as an off-balance sheet financing that increases liquidity and earnings. 6. In debt repayment only a part of interest is tax exempt.
6. The entire rental (leasing repayment) is tax exempt.  Posebnu pažnju treba obratiti na ugovore o povratnom lizingu nekretnina. U tipičnoj transakciji povratnog lizinga vlasnik imovine prodaje nekretnine koje koristi u svom poslovanju nekome ko nije privatni investitor ili institucionalni investitor. Istovremeno sa duration of a leasing agreement, and the option of lease agreement termination [P. Kapor,169]. When drafting the leasing agreement in contemporary business environment, there is a growing concern over the risks to which financing through this mechanism is exposed. In the business of leasing the most important risks are the following: credit risk, interest risk, liquidity risk, exchange rate risk, and the regulatory risk.
In order to acquire a good quality and facilitated drafting of the leasing agreement it is important to have regulatory framework set in place both on the national and on the international level. Regulatory framework did not keep sufficiently prompt pace with the development of the leasing business. Regardless of its unique character resulting from the fact that the business of leasing emerged in practice, and that it is a construct of an autonomous business law, there are not many statutory regulations prescribing leasing procedures to be found in the world today. Although it was initially introduced in the U.S.A., it is interesting to note that this form of business in that country is not legally regulated. There are in the U.S.A., however, some other statutory regulations that are being applied on leasing arrangements, and pertain to the taxation, crediting, or financing [J. Vilus, 291].
For a long number of years, only some of the European countries, the likes of France, Great Britain, Portugal and Italy had their own national leasing legislature. These leasing laws were paying more attention to the matters of status of firms that can, in accordance with their provisions, engage in the leasing business, rather than on the very essence of the leasing enterprise. By the end of the first decade of this century, there is almost no county in Europe that had failed to regulate in some manner the leasing business, or at least some of its forms. The group of countries that already have the leasing law from the end of the last and the beginning of this century was joined by some other countries (Poland, Federation of Bosnia and Herzegovina, and others), by developing the leasing law within the framework of the Civil Code, i.e. the Law on Lien. Some other countries have adopted separate leasing laws (Spain, Croatia, Republic of Srpska, and others), while some other ones passed the law on financial leasing (Russia and Serbia).
Internationally speaking, there was also a need for setting up uniform rules of procedure, that would regulate leasing business (primarily the financial nature of business), in respect to the rental of the classic law, from which this institute actually emerged. On the other hand, uniform rules of procedure were intended to bring this business closer to the even less developed countries, which in view of their financial situation, were very much interested in the financing methods that were more convenient than the classic ones. In the field of international law, i.e. implementation of leasing in the international trade, in addition to the general terms of operation for the leasing companies, an important source of law was found in the UNIDROIT Convention on the international financial leasing, of 1988. Starting from 2005, great efforts have been invested within the UNIDROIT to harmonise the model law on leasing which would, in addition to the financial leasing regulated under the Convention, also regulate the operative leasing. In addition to the Convention, the other sources of law for the international leasing are found in the international trading customs which in the hierarchical order have the advantage in respect to the pronouncements of the multilateral conventions.
Mindful of the fact that the financial leasing has long surpassed the national boundaries and emerged as a very significant business operation on a global level, legislature of Serbia is, logically, reliant on the international sources when regulating these types of agreements. In 2003, the Law on Financial Leasing of the Republic of Serbia was passed, as the first law in this field.
Economically speaking, leaseback arrangement is a two-sided operation involving legal subjects, one who is the supplier (producer, leasing beneficiary or a lessee), and the other who is the lessor (or the financier). Contractual aspect of this two-sided deal is, however, a significantly more complicated matter, as the elements of the leasing agreement may be by far much more diversified than in the other forms of leasing deals. There are actually here two contracts: delivery contract (sales and purchase), between the supplier (producer) and the lessor, and the leasing agreement between prodajom, imovina se daje u zakup prodavcu u dogovorenom vremenskom periodu, obično 20 do 30 godina. Povratni lizing može istovremeno da uključi i korišnjenje i poboljšanje (usavršavanje) predmeta lizinga. Lizing zakupnine su najčešće fiksne i obezbeđuju amortizaciju od prodajne cene nekretnine tokom trajanja zakupa plus određenu stopu prinosa na investicije kupca. Tipična transakcija je obično trostruki neto zakup. Povratni lizing uključuje opciju da prodavac može da obnovi zakup, i da po potrebi, otkupi imovinu [V. Donald]. Povratni lizing nije se ravnomerno razvijao u Evropi, čak i u najrazvijenim zemljama (Tabela 2). Izabrana grupa zemalja je reprezentativna s obzirom da njihove privrede čine oko 80% ukupnog GDP u 27 zemalja Evropske unije. the lessor and the supplier (producer). Sales and purchase contract grants the lessor (who is in this deal only a financier) the proprietary right over the subject of leasing. On the other hand, the supplier of the subject of leasing concludes the leasing agreement with the lessor on the basis of which the lessor is granting the right to use of the subject of leasing to the lessee, on a contracted period and for an agreed compensation which is to be paid periodically within the contracted instalments.

Povratni lizing u Evropi
Leaseback arrangement has found in the first decade of this century its broad application both in the developed countries of the world (U.S.A., Germany, Great Britain, France), and in the European countries in transition (The Czech Republic, Bulgaria, Croatia). This fact helped some of the countries to attempt to resolve in a legally more complex manner this leaseback business. Hence the Ministry of Finance of Croatia prepared Draft Proposal of the Law on Leasing that is putting an emphasis on the leaseback operations.
The accounting coverage of the leaseback transactions has found its solution within the framework of the International Accounting Standard (IAS 17 -Leasing, paragraph 49 to 57). According to the said provisions, when speaking of the leaseback transactions within the financial leasing, earnings from sale at a price higher than the book value is not promptly recognised as the income of the period, but must be deferred over the period of the lease duration. If such a limitation was not applied, the lessor (previous owner of the asset) would be able to sell the asset at an unrealistically high price and in this manner present a very high gain from sale. The lease rental and the sale value are usually assessed simultaneously, and they are treated as one and single transaction for purpose of preventing presentation of an unrealistic financial result.
For purpose of practical drafting of the leaseback agreement what could be used in our case is the format of the International Financial Leasing Agreement [P. Kapor,[208][209][210]. The Law on Financial Leasing itself is rather "parsimonious" regarding the regulation of matters related to the leaseback agreement, so that in real life business practice stands out as an important source of leasing rules. In view of the nature of the leaseback arrangement, every transaction has its own particular features and its own "specific" agreement. In this sense it is important to mention also the supervising role that the National Bank of Serbia has, and which has passed a number of decisions regulating relationships in the field of leasing arrangements, with a special emphasis on the Basic Elements of the Financial Leasing Agreement.
Finally, one fact is definitely and already well known: leaseback business is more complicated than it would appear at a first glance. It requires a solid, financially sustainable and uniform legal framework. Leaseback basically can bring benefits both to the seller and to the buyer, although the leaseback transaction may be structured in different ways. In this, both sides must take into account business and tax benefits, the drawbacks and risks that the leaseback implies before entering the business deal. The buyer must never venture into the leaseback transaction if there is no option for having a clearly defined agreement and an absolute confidence that the transaction is a win-win situation for both contracting parties. The seller is aware of the fact that with this manner of financing he can very easily increase the value of his asset and gain advantage in respect to the buyer who is often unaware of the potential hazards [J. Cummings].
Particular care should be paid to the sale and leaseback agreements involving real estate. In a typical leaseback transaction, the owner of the property sells the real estate that he is using in his business to someone who is not a private investor or an institutional investor. Concurrently with the sale, the real estate is given in lease to the seller for an agreed period of time, usually for a period of 20 to 30 years. Leaseback deal may also simultaneously include the use and rehabilitation (upgrading) of the subject of leasing. Lease rentals are most often fixed and they secure amortisation from the sales value of the real estate for the duration of the lease rental, plus a certain rate of return on the buyer's investment. Typical transaction is usually a three-fold net lease rental. Leaseback includes the option for the seller to be able to renew the rental, and if necessary, to repurchase the asset [V. Donald].

Leaseback in Europe
Financial leasing in Europe started to develop by the end of the 1950s and the beginning of the 1960s. The forerunners in this field were the most developed countries that have accepted the American development concept. The year 1960 marks the beginning of the Europe's opening towards leasing so that the U.S.A. leasing companies begin to open their affiliations or acquire shares in the already established leasing companies. Already in 1960 in Great Britain, the British affiliation was established of the United States Leasing Corporation, Mercantile, Credit CO. An important role in the development and expansion of leasing in Great Britain was played by the fiscal and accounting advantages of this manner of financing. In addition to a number of independent leasing companies in this country, what was also being established were special banks and financial institutes dealing in the business of leasing. Today, it is almost impossible to find an economic asset that can not become the subject of leasing.
In Germany, in 1962 the first leasing company was established in Düsseldorf, while in Austria leasing ideas came into life in 1963 through the establishment of two leasing companies for leasing of particular equipment. In France, the first leasing company was established in 1962 and in Belgium the banks have, in 1962 and 1963 established three leasing companies that have, at the beginning, financed the supply of movable, and later on, expanded their business on financing of the immovable property. In Italy, the business of leasing appears for the first time in 1963 while in Switzerland the leasing practice started a bit later and developed at a slower pace than in the other European countries. In this manner, leasing arrangements had, over a short period of time, conquered the European financial market.
In 1972 European Federation of Leasing Company Associations -Leaseeurope was established, with the seat in Brussels. Federation today numbers 44 associations from 33 countries. As an umbrella institution of European leasing market, Federation joins together some 1,200 leasing companies and represents 92% of the leasing industry in the entire Europe.
Leaseback in Europe started to develop by the end of the last century and the highest peak of its development was achieved in the first decade of this century, in the years of economic prosperity, i.e. in the pre-crisis period. Starting from 2004 when the leaseback transactions in Europe in corporate sector amounted to some 6.7 billion euro, leaseback over the following years gained a very fast momentum of growth. In 2005, the value of leaseback transactions in Europe was 18.6 billion euro, i.e. it marked an increase of almost 1.8 times in respect to the previous year. In 2006 the leaseback value reached 34.1 billion euro, i.e. an increase of some 84% in respect to the previous year, or some 4 times higher than in 2004. In the period 2007 to the first half of 2008, leaseback in Europe reached the value of 59.5 billion euro, i.e. the value higher for some 75% in respect to 2006. In the first half of 2008 leaseback reached a share of 21.3% of the total investment activities in Europe, which is also the highest percentage achieved by that time [CBRE 2013, 1-2]. Decisions of companies to engage in leaseback arrangements were motivated by a number of factors: pressure on raising capital, high borrowing costs, the need for flexible rental of objects, and the growing cultural acceptability of the leaseback of real estate. These factors have elevated the status of the leaseback business as an alternative manner of raising capital of companies. Furthermore, sale and leaseback business came to be regarded as a key factor in the growth of investments in the real estate [PMI 2008].
Leaseback business did not develop evenly throughout Europe, not even in the most developed countries of Europe ( Table 2). The selected group of countries is representative in view of the fact that their economies account for some 80% of the total GDP in 27 countries of the European Union. Analizirajući rast povratnog lizinga u Evropi u prvoj deceniji ovog veka mogu se izvući sledeći zaključci: 1. U situaciji kada su konvencionalni oblici finansiranja postali ozbiljno ograničeni i suviše skupi, transakcije povratnog lizinga predstavljaju održivu alternativu za povećanje obrtnog kapitala, odnosno za povećanje kapitala kroz posao. In the period 2005-H1 2008, especially significant growth of leaseback business was recorded in Germany. Leaseback transactions in the European countries in transition were not much present in comparison with the developed countries. In the countries of South East Europe, in the period from the first half of 2000 and up to the 2012 the value of all the sale and leaseback transactions was only 1.6 billion euro, which makes up for 4.5% of the total investment activities during this period. Just how modest this amount is may be best concluded from the fact that Italy, for example, during 2006 alone, had 1.7 billion euro worth of leaseback transactions. Leaseback business, however, did not develop evenly in all the countries in transition in the region of South East Europe (Table 3). During the observed period, the highest volume of leaseback business was actually achieved in The Czech Republic (27.3%), after the execution of fifteen transactions. Hungary and Poland had nine transactions each and their share was 16.4% in the total leaseback transitions. In practical terms, these three countries make up for more than 60% of all the leaseback transactions. Amongst the other countries, the lowest share in leaseback transactions had Bulgaria and The Republic of Slovakia.
When analysing the scope of the sale and leaseback transactions in the countries of South East Europe, per economic sectors, the following characteristics are observed: the highest scope of transactions was made in industry (35.1%), to be followed by the public sector (26.7%), and in the retail sector (21.8%).
During the time of the world economic and financial crisis, unstable business conditions based on restrictive crediting policies, liberated an "ideal" space for the growth of the leaseback business in the world. However, these transactions in the world, just as the commercial market in general, experienced a great fall. In the countries of South East Europe, during the time of the world economic and financial crisis (end of 2007 -end of 2009), leaseback transactions increased their share in the total leaseback transactions in Europe. At the same time this points out at the fact that in the post-crisis period it is possible to expect higher values of the leaseback transactions in the countries of South East Europe [Colliers].
The analysis of the leaseback business in Europe, in the first decade of this century, leads to the following conclusion: 1 These two countries cover more than one half of all the leaseback transactions in Europe. Nevertheless, the share of these two countries had a downward trend in the expansion on to the new markets. In 2008 the share of Germany and Great Britain fell to 44%, while the share of Spain and Italy grew each year and came up to a cumulative 28%. 5. The type of assets that were the subject of the leaseback transactions had changed over the last several years. Historically speaking, the main focus of transactions is on the activities in the financial sector. However, what occurred was that many corporations were prompt to include in their portfolio factories and land property bringing along some alternative proposals by investors which created an enormous potential for re-grouping (or a re-allocation) of capital. 6. In the quest for raising working capital, mergers and acquisitions are the key factor for growth of leaseback operations with many economic stakeholders and through the sale of real estate.

Development perspectives for the leaseback business in Europe and institutional support
Leaseback transactions offer a number of advantages in respect to the other types of leasing transactions, primarily when speaking of the subject of leasing and flexibility in contracting the leasing agreement. For a selected group of EU countries, in the period 2009-2012 (Table 4) what is characteristic is an emphatic growth trend of the total leasing (except for France and Italy). In the development of real estate leasing two groups of countries may be distinctly differentiated: the first group (Italy, France, and Spain) with a high value of real estate leasing and its great share in the total leasing transactions, and the second group (Great Britain, Germany, and Belgium) where the value of real estate leasing and its share in the total leasing business is rather lower.
Mindful of the characteristics observed in the leasing market in Europe, it is possible to expect favorable conditions for the development of the leaseback business. According to some research conducted, leaseback of companies is to continue and will become the key factor for the growth of the European market, both over a short-term and over a long-term period, and will also be a key impetus for growth of investments on the real estate market [CBRE 2013, 9]. These expectations will be certainly boosted by an institutional support for the development of the sale and leaseback business.
Leaseback transactions are most often to be found in the offer of leasing companies and banks. Institutional support to the leaseback real estate business is offered in some countries by the special financial corporations -the real estate investment trust -REIT, similar to the close-ended investment funds. REIT funds are engaged in providing capital, but also in diversification of risk by creating a business portfolio composed of different types of real estate in different geographical zones. The REIT investors may expect return on the basis of the paid annual dividends, but also on the basis of growth in the price of REIT shares on the stock exchange. Investment in REIT secures for investors a substantially higher degree of liquidity as the shares may be sold relatively promptly on the stock exchange, opposite to the situation in which the investors would be if they had purchased the real estate property.
Posebne aktivnosti na širenju povratnog lizinga kao alternativnog načina finansiranja je pravna regulativa vezana za izradu novih i izmenu postojećih zakona koji bilo na direktan bilo na indirektan način regulišu povratni lizing. Congress adopted a set of laws allowing small investors to invest their capital in large and major real estate property, while these funds (trusts) remained tax exempt on profit and gains, in order to avoid double taxation of investors. At the beginning of 2012 there were 166 REIT trust funds registered with the U.S. Securities and Exchange Commission that are trading on one of the major U.S. stock exchanges -the New York Stock Exchange. It is estimated that these funds hold a total stock market capitalization of 579 billion dollars. In addition to these funds, there are also REIT funds registered with the Securities and Exchange Commission -SEC which are not trading on the regulated markets, and also the REIT funds that are not registered with the SEC but are trading on stock markets. The Internal Revenue Service -I.R.S. of the U.S.A. had published that there are some 1,100 American REIT funds that have filed their tax revenue reports [REIT].
In addition to the U.S. market, funds for real estate investments are the most active and the best developed on the markets of Canada, Japan, and Australia. On the European market, REIT funds have mostly emerged in the first decade of this century. According to the data of the European Real Estate Association -EPRA, in addition to the REIT funds (19%), in the real estate trading according to the number, the higher share is held by the property companies that are buying buildings in order to give them in the lease rentals (48%).
In Europe (Table 5), the oldest REIT fund is to be found in Netherlands, while according to the value of funds and their share in the total European REIT market is to be found in the funds from France (5.91%) and Great Britain (4.41%). According to the number of REIT funds, the leading countries are France (40), and Turkey (23), while Bulgaria (22) has a higher number of these funds than Great Britain (21). The real estate investment funds are a novel idea in the development of the financial market in Serbia. Although the Law on Investment Funds was adopted in 2006 yet the Law did not allow for or foreseen the formation of an REIT fund in the form in which they exist and operate on the European market.
In Serbia, there is a large potential for the development of the leaseback transactions as the primary REIT product, or rather there is a substantial space for profitable business operations of the REIT funds. Construction of hotel chains, retail trade chains, housing units and similar is the real challenge for the establishment and successful business operation of the REIT funds. Leasing companies that are now present are facing the major problem of the small financial potential, which is seriously limiting development of leaseback business.
Example 5 -Investment funds management company, Delta Investments, at present is in the phase of obtaining the permit for its new investment fund -Delta Real Estate, which will invest not less than 60 percent of its assets into the real estate operations. Delta Real Estate intends to issue 150,000 shares in the individual value of 10,000 dinars, so that the total value of the issue will be one billion and half dinars (an equivalent of some 20 million euro). The issue of such a value is deemed in Delta Investments to be an optimal one for serious investment venture into the sector of real estate and for the start-up of work of this type of fund on the Serbian market. They are of the mind in the company that in the situation of a falling capital market and global financial crisis it is necessary to offer to the domestic market and to investors a new opportunity, i.e. investment in real estate where the value is considerably less exposed to the short-term market fluctuations. Real estate is the property with growing value in the longterm prospect, argue in Delta Investments and add that their target group, the so-called Strategic Investors on a medium and longterm basis, and not speculators. The company expects to find among the shareholders insurance companies, banks, and large-scale companies, but also small investors who are planning through their investment in the fund to place their money, on a medium and longerterm basis, in the real estate market [Economy].
Although there is a positive international, especially European experience in the development of the leaseback business, Serbia is showing for so many times again and again that it is not apt at using favorable opportunities for the development of this type of financing and establishment of particular institutions necessary for this type of business. The first step is certainly the regulatory framework, which in turn includes amendments to the taxation legislature in accordance with highly acceptable experience of the European countries in which this market is already very well developed.
Example 6 -Delta Real Estate, member of the "Delta Holding", in July 2012 intends to start with the renovation of Hotel "Continental" situated in New Belgrade, where an investment of 30 million euro will be made, and large investments are planned for construction of the shopping malls and retail parks as well [SEEbiz].

Concluding remarks
Leaseback arrangement, as a mechanism for securing working capital for companies on the basis of movable and immovable assets, experienced its "boom" in Europe in the first decade of this century. Leaseback reached the highest growth rates in respect to all the possible alternatives that were present on the financial markets.
The main features that are placing this type of leasing above all the other leasing forms are the following: a very broad range of choice of the leasing objects and a high flexibility in the leasing contracting.
Nevertheless, the greatest advantage of this type of financing is the opportunity for the companies to raise working capital on the basis of real estate leasing. In Serbia, there are a number of companies that have, over the last several years, invested in construction of structures, buildings, halls, business centers, that have upon maturity of liabilities, captured their money and endangered their liquidity. Such a model of financing has yielded excellent results in several European countries.
In order to see the development of sale and leaseback transactions what is primarily needed is the institutional support. Leaseback of real estate in Serbia exists only as the option in Serbia offered by a small number of leasing companies and one real estate fund. Pireus Leasing, for example, offers several options for the real estate leasing, from buying a building at an order of the client and giving in leasing up to the purchase of the real estate which is in the ownership of the client, which is then, in turn, given back in lease rental to him. In leaseback arrangements there is an option, after a certain period of time, 10 years at the most, for the real estate to be returned to the owner. Particular activities in the development of leaseback business, as an alternative way of financing, is the regulatory framework related to the drafting of new and amendments to the existing laws which either directly or indirectly are regulating the sale and leaseback transactions.