P.R. Laws tit. 10, § 2401
For the purposes of this chapter, the following terms shall have the meaning stated below:
(a) Lessor. — Means a person or entity engaged in the leasing business and owns a chattel which he/she t cedes the right to use and enjoy it through a lease to a lessee.
(b) Lease. — Means a contractual agreement between a lessor and a lessee in which the right to use and enjoy the personal property of the lessor is granted to a lessee, for a specified period, in exchange for several previously-stipulated periodic payments.
(c) Financial lease. — Means a lease that meets one of the following requirements under a lease contract:
(1) If in the lease contract, ownership of the property is transferred to the lessee when the term of the lease expires.
(2) If the lease contract has a purchase option at a substantially lower value than the fair market value when the option was made.
(3) If the term of the lease contract is equal to or greater than seventy-five percent (75%) of the useful life of the leased chattel.
(4) If the current value of the minimum payments in the lease contract, excluding administrative expenses, is equal to or greater than ninety percent (90%) of the fair market value of the leased chattel.
(d) Open financial lease. — Means that lease in which a resident value, for which the lessee is responsible, is established.
(e) Closed financial lease. — Means that lease in which the lessee does not have any responsibility at the end of the leasing term, except when the lessor’s interest is diminished.
(f) Operative lease. — Means all those leases that do not meet the requirements of the financial lease as defined in this chapter.
(g) Consumer lease. — A lease granted to natural persons mainly for personal or family purposes, in which the cost of the personal property does not exceed sixty thousand dollars ($60,000).
(h) Lessee. — Means that person who acquires from a lessor the right to use and enjoy a chattel through a lease.
(i) Personal property. — Means that chattel or chattels that because of their nature can be transferred, transported from one point to another without impairing any other thing to which it is attached, or those which by law, are defined as chattels and are subject to leasing. Assets ceded by lease for a term of less than one year, and those without a fixed term, are excluded.
(j) Commissioner. — Means the Commissioner of Financial Institutions.
(k) Financing charges. — Means the amount charged for financing to the lessee. These are obtained by multiplying the rate agreed upon by the number of original term periods of the lease, as established in the lease contract, adding the residual value, if any, and subtracting the cost of the chattel and any included insurance.
(l) Cost. — Means the sum of the purchase price, net of any down payment made by the lessee, plus transportation and freight charges, insurance, excise taxes, installation or preparation, registration, licenses of the leased chattel, plus any other expenses assumed by the lessee in the execution of the lease.
(m) Price. — Means the amount paid by the lessor to the supplier for the lease chattel.
(n) [Provider]. — Means the person who sells the chattel selected by the lessee to the lessor.
(o) Supplier. — Means the manufacturer or his/her authorized distributor who enters into an exclusive operative contractual lease agreement with the lessee.
(p) Term of the lease. — Means the number of periods (months, semesters, trimesters or years) for which the lessor cedes to the lessee the right to use and enjoy the leased chattel.
(q) Present value. — Means the discounted value of a lease, at the interest rate established between the parties, on a certain date of specific future rates, payable in the future.
(r) Realized value. — Means the amount received net, of any possible expense, for the sale incurred by the lessor, upon the sale of the chattel surrendered by the lessee. If the chattel is [relet], it shall mean the present value under the new contract.
(s) Residual value. — Means the final amount that the lessee shall pay the lessor, in the case of an open financial lease, in order to obtain title of the leased chattel.
For the purposes of the implementation of this chapter, those sections where it does not specify that they apply to consumer leasing, they shall apply to all kinds of leases, including the consumer leases. Those that are specifically indicated for consumer leasing shall apply exclusively to those.
History —Aug. 13, 1994, No. 76, § 3; Sept. 6, 1996, No. 192, § 1; Aug. 21, 1999, No. 294, § 1.