The newly released the State Council Document No.43 stipulates that social capital should be encouraged to participate in the investment and operation of public welfare undertakings with certain benefits such as urban infrastructure through franchising, and the government can make investors have long-term and stable benefits through publicly announced revenue agreement rules such as franchising, reasonable pricing and financial subsidies. The government does not assume the debt repayment responsibility of investors or special purpose companies. This product is formulated to adapt to this policy.
Second, the purpose of product design
Social capital alone or jointly with the government * * * set up a special purpose company (hereinafter referred to as SPV) to carry out cooperation projects in company construction and operation. Investors or SPV can borrow through market-oriented methods such as bank loans, corporate bonds, project income bonds and asset securitization. And bear the debt repayment responsibility.
Third, product design advantages.
1. It is beneficial for government platform institutions to avoid the influence of Circular 43.
2. It is conducive to broadening the scope of cooperation between leasing companies and the government.
Fourth, the scheme operation process
(1) Program Flow Introduction
1. The government platform organization and the group company signed a cooperation agreement * * * to establish SPV company. Government platform institutions can contribute in the form of assets, and group companies can contribute in cash.
2. The leasing company signs an equipment sales contract (part funded by government platform institutions) and a financial leasing contract with SPV company;
3. The government platform institution pays the service fee to the leasing company;
4. Lease the company and apply for factoring loan from the bank;
5. Banks issue loans to leasing companies;
6. The leasing company pays the equipment purchase price to SPV company;
7.SPV Company shall return the principal and interest of the leasing company when due;
8. The leasing company shall return the principal and interest of Bank A at maturity.