TRW & Co · Banking, Finance & Restructuring
Asset Finance Lawyers in London
Asset finance lawyers in London structure and document the funding of equipment, vehicles, aircraft and vessels through leases, hire purchase and secured loans. The legal questions are about ownership, registration, regulation and what happens in an insolvency. With motor finance redress and tighter conduct rules reshaping the market, getting the structure right matters more than ever.
Key pointA lease is only as good as the lessor's ability to prove ownership and recover the asset. Recharacterisation as an unregistered charge, fixtures and an administration moratorium are the three points that most often turn a secured position into a negotiation.
At a glance
Substance over label
Courts look at the rights actually created. A lease that functions as security may be treated as a charge, which is void against an administrator if unregistered.
21-day charge registration
Charges granted by a company must be delivered to Companies House within 21 days beginning with the day after creation, or a court order is needed.
Administration freezes repossession
In administration, lessors cannot repossess goods under hire purchase, leasing, conditional sale or retention of title agreements without consent or court permission.
Consumer credit reach
Agreements with consumers, sole traders and small partnerships can be regulated under the Consumer Credit Act 1974, with strict form and authorisation requirements.
Specialist asset registers
Aircraft interests are registered under the Cape Town Convention, while ships are registered on the UK Ship Register; priority depends on registration.
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What asset finance lawyers in London advise on
Asset finance lawyers in London advise on the funding of physical, income-producing equipment, where the finance is secured on, or structured around, the asset itself. That covers everything from vehicle fleets, plant, machinery and IT hardware to aircraft, engines, ships, rolling stock and renewable energy equipment. The finance provider looks first to the value of the asset, not only to the borrower's balance sheet.
The legal work sits where property law, contract, insolvency, tax and regulation meet. A lessor needs to know that it owns the asset and can recover it. A lessee needs a contract that fits how it actually uses the equipment. A bank funding a lessor needs security over the lease receivables and the asset. Each of those questions has a specific English-law answer, and getting one wrong can turn a secured deal into an unsecured claim in an insolvency.
TRW & Co acts for lessees and borrowers, independent lessors and brokers, banks and funds, and international groups financing equipment used in the UK or bought from UK suppliers. Our work connects closely with our banking and finance and transport practices.
Asset finance structures compared
The first decision is the structure. Each product allocates ownership, risk, tax treatment and accounting treatment differently, and the label on the document does not settle the legal character: a court looks at the substance of the rights and obligations. Asset finance lawyers in London will usually start by asking who should own the asset at the end of the term and who should carry its residual value risk.
| Structure | Who owns the asset during the term | End of term | Typical use and trade-offs |
|---|---|---|---|
| Hire purchase | Finance company; customer hires with an option to buy | Customer may buy, usually for a nominal option fee, once all instalments are paid | Common for vehicles and plant; customer often claims capital allowances; protected goods rules for consumers |
| Conditional sale | Finance company until conditions are met | Title passes automatically on final payment | Similar economics to hire purchase but the customer is committed to buy |
| Finance lease | Lessor throughout | Secondary rental period, or sale to a third party with a rebate of proceeds to the lessee | Lessee bears most of the risks and rewards; ownership never passes to the lessee |
| Operating lease | Lessor throughout | Asset returned; lessor carries residual value risk | Suits assets with a strong second-hand market such as aircraft, vehicles and IT equipment |
| Secured loan or chattel mortgage | Borrower | Security released on repayment | Lender takes a charge, which for a company must be registered at Companies House |
| Sale and leaseback | Finance provider buys the existing asset and leases it back | As under the chosen lease type | Releases cash from owned equipment; care needed over valuation, title and existing security |
Accounting matters too. Under IFRS 16, most leases appear on the lessee's balance sheet, so the old distinction between "on" and "off" balance sheet leasing no longer drives structure as it once did for groups reporting under IFRS. Tax drivers, particularly who claims capital allowances and how lease rentals are treated, still do. Those rules have changed several times in recent Budgets, so the tax analysis should be refreshed for each transaction with our tax team.
The legal framework in England and Wales
Title, sale and hire
The basic law of title to goods comes from the Sale of Goods Act 1979, the Supply of Goods (Implied Terms) Act 1973 for hire purchase, and the Supply of Goods and Services Act 1982 for contracts of hire. Business-to-business leases usually exclude or limit the implied terms about quality and fitness, and the lessee looks to the manufacturer for warranty claims. Those exclusions must pass the reasonableness test in the Unfair Contract Terms Act 1977, so they need careful drafting.
Part III of the Hire Purchase Act 1964 creates a significant exception to the rule that a person cannot pass better title than they hold. A private purchaser who buys a motor vehicle in good faith from a hirer under a hire purchase or conditional sale agreement can acquire good title. Motor finance lenders therefore rely on registration with private vehicle finance registers and on contractual controls, rather than on title alone.
Registration of security
Where a company grants a charge over equipment, the charge must be delivered to Companies House within the period set by section 859A of the Companies Act 2006: 21 days beginning with the day after the charge is created. An unregistered charge is void against a liquidator, an administrator and creditors, although the secured debt remains payable. Late registration requires a court order.
True leases and hire purchase agreements are not charges and are not registrable at Companies House, because the finance company owns the asset. That is why recharacterisation risk matters: if a so-called lease is in substance a security arrangement, an unregistered "lease" may fail in the lessee's insolvency. Individuals and some partnerships who grant security over goods face the Bills of Sale Acts, which are technical and unforgiving; most lenders avoid them.
Specialist asset registers
Some assets have their own registration systems. Aircraft and aircraft engines are subject to the Cape Town Convention and Aircraft Protocol, given effect in the UK by the International Interests in Aircraft Equipment (Cape Town Convention) Regulations 2015. International interests are registered on the International Registry, and priority generally follows the order of registration. UK-registered aircraft can also carry mortgages registered with the Civil Aviation Authority. Ships are registered on the UK Ship Register, where registered ship mortgages take priority under the Merchant Shipping Act 1995.
Consumer credit regulation
Hire purchase, conditional sale and hire agreements with consumers, sole traders and small partnerships can be regulated agreements under the Consumer Credit Act 1974. Lenders, lessors and brokers in that market need FCA authorisation, and the agreements must meet strict form, content and pre-contract requirements. A defective agreement may be unenforceable without a court order, and the courts can reopen an unfair relationship under section 140A.
There are exemptions, including for some high-value business lending, but they turn on precise conditions and declarations. Asset finance lawyers in London should confirm the regulatory status of every agreement template before it is used at scale, and our consumer credit team reviews documentation and promotions for that purpose.
Motor finance, conduct risk and the FCA
Vehicle finance is the largest regulated asset finance market in the UK, and the one under most scrutiny. Following the Supreme Court's 2025 judgment on commission paid by lenders to dealers, the FCA made a consumer redress scheme covering motor finance agreements with undisclosed commission arrangements. Parts of that scheme were later suspended pending a challenge in the Upper Tribunal, and the position continues to move.
For lenders and brokers, the legal issues include complaint handling, data retrieval for old agreements, the interaction between the scheme and litigation, and the commercial allocation of liability between lender and broker under their introducer agreements. Our guide to the motor finance redress scheme sets out the current state of play.
Conduct risk is not limited to cars. The FCA's Consumer Duty applies to regulated asset finance for retail customers, which affects pricing, product design, communications and how arrears and repossessions are handled. Lessors that move into consumer or small business markets need to plan for that framework before launch rather than after the first complaint.
What happens when the lessee or borrower fails
Insolvency is where asset finance structuring is tested. The answer depends on the procedure and on whether the financier owns the asset or holds security over it.
Administration and the moratorium
When a company enters administration, paragraph 43 of Schedule B1 to the Insolvency Act 1986 prevents any step to enforce security or to repossess goods held under a hire purchase agreement without the administrator's consent or the court's permission. For this purpose, "hire purchase agreement" includes conditional sale, chattel leasing and retention of title agreements. A lessor cannot simply collect its equipment.
Administrators often want to keep using leased assets to trade the business or sell it as a going concern. The lessor's leverage then lies in negotiating continued rental payments as an expense of the administration, or a sale of the asset to the buyer of the business. Where the administrator refuses, an application for permission is possible, and the court balances the lessor's proprietary rights against the purpose of the administration.
Ipso facto restrictions
The Corporate Insolvency and Governance Act 2020 restricts suppliers from terminating supply contracts because the customer enters a relevant insolvency procedure. Financial services contracts, including lending and leasing by financial institutions, are among the excluded categories, but the exclusions are technical. Asset finance lawyers in London should check whether a particular equipment, maintenance or service contract falls inside the restriction before a lessor relies on an insolvency termination right.
Liquidation, restructuring plans and the free-standing moratorium
In liquidation, goods owned by a lessor do not form part of the company's estate, so the lessor can recover them, subject to proving title and identifying the assets. Restructuring plans under Part 26A of the Companies Act 2006 and the free-standing moratorium under Part A1 of the Insolvency Act 1986 can also affect lessors and secured lenders. Our restructuring and insolvency team advises financiers on both sides of those processes.
Asset identification is often what decides recovery. Serial numbers, location records and clear asset schedules turn a proprietary claim into a quick collection. Vague descriptions such as "all equipment at the site" invite a dispute with the administrator, the landlord and other financiers over which items belong to whom.
How an asset finance transaction runs
Most equipment finance follows a predictable sequence. Large or cross-border transactions, such as aircraft or vessel financings, add layers of registration and local law opinions, but the shape is the same.
- Structure and credit approval. Agree the product, term, residual value position, tax treatment and any guarantees or security, and confirm whether any agreement is regulated.
- Supplier and title diligence. Confirm the supplier's title, check existing charges at Companies House and specialist registers, and review any retention of title in the supply contract.
- Documentation. Negotiate the master agreement and schedules, supply or novation agreement, guarantees, insurance provisions and, where relevant, a funder's security over the lease receivables.
- Conditions precedent. Collect corporate authorities, insurance certificates, delivery and acceptance certificates, legal opinions and know-your-customer documents.
- Delivery, acceptance and funding. The lessee signs an acceptance certificate, the financier pays the supplier, and title passes to the financier.
- Registration and perfection. Register charges at Companies House within the statutory period, and register interests on the International Registry, CAA register or UK Ship Register where relevant.
- Life of the deal. Monitor insurance, maintenance, location and covenant compliance; manage variations, sub-leases and refinancing.
- End of term or enforcement. Exercise purchase options, return the asset against agreed return conditions, or take enforcement action on default.
Documents and evidence to assemble
Asset finance lawyers in London spend much of their time on documentation, because good documentation is what makes the asset recoverable and the income stream bankable. The core set for a business equipment deal is usually:
- a master lease or hire purchase agreement with individual schedules for each asset or drawdown;
- the supply contract, purchase order or novation agreement transferring the supplier relationship to the financier;
- guarantees and indemnities from parent companies or directors, drafted so they survive variations of the underlying agreement;
- insurance provisions naming the financier as loss payee and, where appropriate, additional insured;
- delivery and acceptance certificates, with serial numbers and locations;
- landlord or mortgagee waivers where equipment sits in leased premises or could become a fixture; and
- for a funder lending to a lessor, an assignment of lease receivables and a charge over the lessor's rights, with notices to lessees where the structure requires them.
Aircraft and marine deals add the lease, a security assignment, deregistration powers of attorney, registrations, technical records and maintenance reserve arrangements. Our guide to taking security in the UK explains how the general security toolkit applies.
A lease that reads like a loan may be treated as a loan. The substance of the rights, not the label on the document, decides whether a lessor owns the asset or holds an unregistered charge.
Risks and common mistakes
The disputes that reach asset finance lawyers in London tend to follow a handful of recurring patterns.
Recharacterisation of a lease as security
If the lessee effectively has the economic ownership of the asset and the lessor is only protected for repayment of a sum of money, a court may find that the arrangement is a charge rather than a lease. For a corporate lessee, an unregistered charge is void against an administrator or liquidator. Sale and leaseback deals are particularly exposed, because the lessee owned the asset first. Draft the documents to reflect a genuine transfer of title, keep purchase options and rebates consistent with the chosen structure, and register protectively where there is doubt.
Equipment that becomes a fixture
Heavy plant, generators, solar panels and similar equipment can become fixtures and part of the land, so that ownership passes to the landowner whatever the lease says. Whether that happens depends on the degree and purpose of annexation. Financiers should take landlord and mortgagee waivers that acknowledge their ownership and grant access to remove the equipment. Without one, a lessor may find itself arguing with a landlord who has forfeited the lease or a mortgagee who has taken possession.
Unregulated-looking agreements that are regulated
Lessors focused on business customers sometimes assume consumer credit rules cannot apply. But agreements with sole traders and small partnerships can be regulated, and exemptions depend on precise conditions and declarations. A defective regulated agreement may be unenforceable without a court order, and an unauthorised lender faces more serious consequences. Check the customer base, the agreement templates and any broker arrangements, and confirm the authorisation position before writing new business.
Retention of title conflicts with the supplier
If the supplier sold the equipment under a retention of title clause, the financier may pay for an asset that the supplier still owns. All-monies clauses can keep title with the supplier until every debt owed by the buyer is paid, not just the price of that item. Always obtain a supplier confirmation that title passes free of encumbrances on payment, and check whether the supplier's own lenders have security over its stock.
Guarantees discharged by variation
Guarantees can be discharged if the underlying agreement is varied in a way that prejudices the guarantor without their consent. Re-scheduling payments, adding assets or extending the term are common variations in asset finance. Guarantees should contain clear consent and preservation wording, and in practice the financier should obtain guarantor acknowledgements when material changes are made. See our guide to personal guarantees.
Repossession without the right process
Self-help repossession is a high-risk step. Regulated agreements have statutory protections, including restrictions on recovering protected goods, and an administration moratorium freezes recovery entirely without consent or permission. Entering premises without a contractual licence can amount to trespass. Before taking an asset, confirm the default, the contractual termination route, any notice requirements and whether an insolvency procedure is in place.
Cross-border asset finance: Bangladesh, the Gulf and Asia
Mobile assets cross borders, and so do financiers. English law is widely used for aircraft and vessel leases and for equipment finance documents involving lenders in London, the Gulf and Asia. The law governing title and security, however, usually depends on where the asset is located or registered, so a London-law lease rarely answers every question on its own.
Where equipment will be used in Bangladesh, or financed by a Bangladeshi business acquiring machinery from UK or European suppliers, the transaction needs to address Bangladeshi rules on imports, foreign exchange, registration of security and enforcement. Our Dhaka office advises on the Bangladeshi side, and our UK–Bangladesh trade and finance team coordinates both legal systems in one workstream. Enforcing an English judgment or arbitral award in Bangladesh involves its own procedure, which should be planned before the governing law and dispute resolution clauses are agreed.
For aircraft, the Cape Town Convention offers a common framework where both relevant states have adopted it, but each state can make declarations that change how remedies work. Gulf, Singapore and Chinese law issues arise often in lessor, airline and shipping transactions, and we work with local counsel where local law governs title, registration or enforcement.
How TRW & Co helps
As asset finance lawyers in London, we focus on documentation that works in practice and on the points that matter when something goes wrong. Typical workstreams include:
Lessor and lender documentation
We draft and maintain master agreements, schedules, guarantees and supplier documents for lessors and funders. Templates are checked for consumer credit status, enforceability and insolvency resilience.
Lessee and borrower advice
We review and negotiate equipment leases and hire purchase agreements for businesses, focusing on return conditions, insurance, maintenance, early termination costs and covenant flexibility.
Block discounting and funding lines
We act on facilities for lessors and brokers, including assignment of receivables, security packages, eligibility criteria and the mechanics of funding new business.
Aircraft, vessel and high-value assets
We advise on English-law leases and financings of aircraft, engines and vessels, coordinating registrations and local counsel opinions across jurisdictions.
Regulation and conduct
We advise on FCA authorisation, consumer credit documentation, Consumer Duty implementation and the response to motor finance complaints and redress.
Defaults, recoveries and insolvency
We act on terminations, asset recovery, claims against guarantors and negotiations with administrators and liquidators. Where advocacy in the higher courts is required, we instruct specialist counsel.
You can explore our full range of services on our practices page, or contact our London office to discuss a transaction or a problem.
Checklist for decision-makers
Before signing or funding an asset finance deal, ask asset finance lawyers in London to confirm the following:
- Is the chosen structure consistent with who should own the asset and who carries residual value risk?
- Has the tax and accounting treatment been confirmed for this transaction, not assumed from the last one?
- Is any agreement regulated under the Consumer Credit Act 1974, and is every party in the chain appropriately authorised?
- Has the supplier's title been confirmed, and have existing charges and retention of title been cleared?
- Do the documents identify each asset precisely, with serial numbers and locations?
- Have charges been registered at Companies House within the statutory period, and have specialist registrations been made?
- Are there landlord or mortgagee waivers for equipment in third-party premises?
- Do guarantees survive variations, and are insurance and loss payee provisions in place?
- Is there a clear default, termination and recovery route that works in administration as well as outside it?
- For cross-border assets, has local law on title, registration and enforcement been checked?
Frequently asked questions
01What is the difference between a finance lease and an operating lease?
Under a finance lease, the lessee carries most of the risks and rewards of the asset over its useful life, and the lessor's return comes mainly from the rentals. At the end of the term, the lessee typically continues on a secondary rental or arranges a sale and receives most of the proceeds. Under an operating lease, the lessor keeps the residual value risk and expects the asset back to re-lease or sell. The distinction affects pricing, return conditions, maintenance responsibility and, in some cases, tax treatment.
02Does a lessor need to register its lease at Companies House?
A true lease or hire purchase agreement is not a charge, because the financier owns the asset, so it is not registrable at Companies House. But if the arrangement is in substance a security interest, for example some sale and leaseback structures, it may be treated as a charge. An unregistered charge granted by a company is void against an administrator, liquidator and creditors. Where there is genuine doubt, financiers sometimes register protectively, and the documents should be drafted to support the intended characterisation.
03Can a lessor repossess equipment if the customer goes into administration?
Not without permission. Paragraph 43 of Schedule B1 to the Insolvency Act 1986 prevents any step to repossess goods under a hire purchase agreement, which for this purpose includes leasing, conditional sale and retention of title agreements, unless the administrator consents or the court gives permission. In practice, lessors negotiate with the administrator for continued payments or a sale of the asset to the purchaser of the business, and apply to court only if negotiation fails.
04Are business equipment leases regulated by the FCA?
Many are not, but some are. Hire and hire purchase agreements with individuals, including sole traders and small partnerships, can be regulated under the Consumer Credit Act 1974, which requires FCA authorisation and compliant documentation. There are exemptions for some business lending, but they depend on specific conditions and declarations. Lessors and brokers should map their customer base and agreement types against the regulatory perimeter before writing new business.
05What is the Cape Town Convention and why does it matter?
The Cape Town Convention and its Aircraft Protocol create an international system for registering interests in aircraft, airframes, engines and helicopters, with priority generally following registration on the International Registry. The UK gives effect to it through the International Interests in Aircraft Equipment (Cape Town Convention) Regulations 2015. It matters because aircraft move between jurisdictions, and a consistent registration and remedies system improves the financier's position, subject to each state's declarations.
06How do we protect equipment installed in premises we do not own?
Equipment fixed to land can become part of it, and a landlord or mortgagee may then claim it. Financiers should obtain a waiver from the landlord and any mortgagee confirming that the equipment remains the financier's property and granting access to remove it. Lessees should also be required to notify the financier of any change of location or any threat of forfeiture. Without these protections, recovery can turn into a dispute about land law rather than a simple collection.
07Can TRW & Co act on cross-border aircraft or vessel financing?
Yes. Our London office advises on English-law leases, security documents and registrations, and works with our Dhaka office and with local counsel in other jurisdictions where local law governs title, registration or enforcement. We coordinate the legal opinions, conditions precedent and filings so the transaction closes as one package. We do not promise outcomes, but we focus on the points that determine whether the financier can rely on its rights later.
Sources and official materials
- Companies Act 2006, section 859A — Registration of charges created by a company
- Insolvency Act 1986, Schedule B1, paragraph 43 — Administration moratorium on enforcement and repossession
- Consumer Credit Act 1974 — Regulated hire, hire purchase and credit agreements
- Hire Purchase Act 1964, Part III — Title to motor vehicles on hire purchase
- International Interests in Aircraft Equipment (Cape Town Convention) Regulations 2015 — UK implementation of the Cape Town Convention
- FCA: Consumer credit firms — Regulatory requirements for consumer credit businesses
- FCA: Car finance claims — Current position on motor finance complaints and redress
General information only, current as at 21 October 2026. It is not legal advice and does not create a solicitor–client relationship. It reflects the law of England and Wales unless stated otherwise; Scotland and Northern Ireland have separate legal systems, and the law changes frequently. Check current official sources and take advice on the facts of your matter.