3. April 2020
The official declaration of the coronavirus pandemic by the World Health Organization, the Decision of the Ministry of Health of the Republic of Croatia on the declaration of the COVID-19 epidemic caused by the SARS-CoV-2 virus of 11 March 2020, as well as the earthquake that struck the Zagreb area on 22 March 2020, all impact the situation and trends on the financial market, interest rates, returns on financial instruments and creditworthiness of lessees and the entire leasing industry.
In accordance with its authority to promote, organize and monitor measures for the efficient functioning of financial markets, and in order to mitigate the negative effects on the economy as a whole, on 30 March 2020 Hanfa sent a letter with recommendations and desired objectives to all leasing companies with the aim to mitigate the negative impact of extraordinary events on the economic activity, business stability and the protection of users of leasing services.
The recommendations allow leasing companies to adopt decisions according to which the lessees who have duly settled their obligations and who, based on clearly defined criteria, are determined to be unable to further pay their obligations, and whose business is already affected or will be affected and, starting from April 2020, fail to settle three instalments/annuities for three consecutive months, will not undergo enforcement until 31 March 2021.
Leasing companies are allowed to adopt a decision that by 31 March 2021 they will not be obliged to form an allowance for receivables under contracts concluded with the above-mentioned lessees, in order to facilitate the business operations of leasing companies themselves and reduce operating losses caused by the non-payment of instalments/annuities by the lessee.
With respect to the possibilities and conditions of amendments to active contracts, reschedules and grace periods, in these times of crisis, Hanfa is notifying all interested parties that these, as well as the terms and conditions of any amendments in the contractual relationship, shall be mutually agreed upon by the parties to the contract, in accordance with the Leasing Act and the Civil Obligations Act whose provisions, inter alia, apply to the amendments or termination of a contract due to changed circumstances or to the rights of lessees in the event of extraordinary occurrences.
Hanfa continues to closely monitor the impact of the current emergency situation on the supervised entities and users of their services, and it is acting in accordance with its supervisory authority and, subject to further developments and as appropriate, it will continue to issue further recommendations to supervised entities, as well as to issue necessary measures and inform the public thereof, just as it has done so far.