Canada Small Business Financing (Establishment and Operation of Capital Leasing Pilot Project) Regulations

35 (1) When a capital lease is transferred by a lessor to another lessor at the request of the lessee, the parties to the transfer shall notify the Minister of the transfer in the form referred to in subsection (4).

(2) After the transfer referred to in subsection (1), the Minister is liable to pay to the transferee the amount of any eligible loss, calculated in accordance with subsection 44(7), sustained as a result of a lessee’s default on the capital lease if

• (a) the Minister’s liability under section 7 in relation to the remaining capital leases of the transferor does not, as a result of the transfer, exceed the amount already paid by the Minister to the transferor, if any; and

• (b) the total number of capital leases transferred by the transferor under this section, for the duration of these Regulations, does not exceed the greater of 20 and 1% of the number of capital leases entered into by the transferor during that period.

(3) The Minister shall determine whether the requirements set out in subsection (2) have been met and shall notify both lessors of the determination.

(4) The lessee and both the transferor and transferee shall sign a form which includes the registration number assigned to the capital lease by the Minister and the lessee’s acknowledgement that the lessee requested the transfer.

(5) A transfer of a capital lease shall be registered or published in accordance with applicable provincial law.