Timeshare and Holiday Clubs

Buying into a timeshare gives you the right to use a property for an allocated period of time each year. A timeshared property is jointly owned or leased by multiple persons and therefore, as opposed to other forms of tourist accommodation, timeshare contracts are performed in a long run prospective.

Holiday clubs are a variation of timeshare agreements which have sprung up in recent years. Aggressively sold in Portugal and Spain, holiday clubs usually promise luxury holidays at knock down prices to club members. However, these promises are rarely lived up to. Every year holidaymakers contact ECC Dublin to complain about holiday clubs. The number one complaint is that these clubs fail to deliver on their promises. Many consumers say that it is cheaper to book their holidays through an independent travel agent than it is through membership of a holiday club.

• Holiday Clubs: Legal protection
• Holiday Clubs: General Advice
• Timeshares: Legal protection
• Timeshares: General Advice

 

Unlike timeshare agreements, there is no specific European legislation related to holiday clubs. In fact holiday clubs were specifically designed to circumvent Directive 94/47/EC on timeshare agreements. The lack of regulation of Holiday Clubs means that they are not covered by rules on cooling-off periods, deposits and consumer information. Consequently, consumers who sign up under pressure have little scope to change their mind.

In order to close this gap in protection, European Directive 2008/122/EC was approved last year and will extend the scope of the 1994 EU Timeshare Directive to cover new products which have emerged on the market, like discount holiday clubs. This Directive has not yet been transposed into National Law by the member states and the deadline given by the Directive to do so is 23rd February 2011.

 

1. Be extremely cautious of companies employing aggressive sales techniques
   Like timeshare sales, you may be enticed into attending a long presentation by someone who approaches you with a scratch card which subsequently reveals a free cruise, bottle of wine or free holiday. At the presentation you can be put under pressure to buy a "membership" to a Holiday Club without proper consideration of the terms and conditions. If you are approached by someone with a scratch card which subsequently reveals a free prize, be extremely suspicious. A reputable company should allow you to take a copy of the contract home and give you time to consider your options.
2. Consider the financial consequences
   Holiday Club membership can often entail;
   • A burden on your finances in the long run (often up to 35 months)
   • The price of holidays not being as attractive as you had been told
   • Add-ons which may make holidays even more expensive
3. Always seek independent legal advice before signing a holiday club membership
4. If you have already signed up to a Holiday Club and wish to cancel
   Check the terms and conditions of your contract carefully and to put your request to cancel in writing to the company immediately. You may also consider contacting your credit card company to see if they can offer any assistance. If you require further orientation or advice please contact our office.

 

European Directive 94/47/EC protects consumers when entering into a timeshare contract, but ONLY for contracts lasting a minimum of three years. This directive is implemented in Ireland, by S.I. No. 204 of 1997 as amended by S.I. 144/2000.


The Directive establishes two types of requirements:

1. Provision of Information
   For timeshares sales in the European Economic Area, the Directive requires that certain information must be given to consumers before signing a contract and sets out the requirements for the content of the contract.
   
   A timeshare agreement must include the following basic minimum information:
   
   • The vendors details
   • The price and other associated charges
   • The location
   • Description of the property and its location
   • If the property is under construction, a completion date
   • How the property is to be managed
   • Maintenance and repair of the property
   • The provision of services such as water or electricity
   • Common facilities and associated charges
   • The consumer's right to cancel, and the procedure for cancelling or withdrawing from the contract.
   • You are entitled to a copy of the contract in English so ask for a certified translation.
2. Cancellation Rights
   The directive gives consumers a 10-day cooling-off period from the day they sign the timeshare contract during which time they are not required to pay any money and can cancel the contract for any reason without penalty. Should certain information be not provided, this period is extended to three months as from the date that this information is provided.

 

1. Be aware of aggressive sales techniques
   Often companies selling timeshare invite people to presentations by different luring techniques. Consumers are usually approached on holiday and offered a scratch card which invariably reveals a prize. To avail of the prize consumers are told they have to attend a nearby office to listen to a "short" presentation. These presentations often turn into lengthy sales pitches and consumers can be put under pressure to sign a contract without proper consideration of its terms and conditions.
2. Consider the financial consequences
   A timeshare can often entail;
   • A burden on your finances in the long run
   • Unforeseen additional charges, including yearly maintenance charges for the property as well as insurance and transport costs
   • Difficulties reselling the shared property
3. Be extremely cautious of suspicious Timeshare resale companies
   Some Timeshare resale companies approach timeshare owners (often by cold calling) and offer them a marketing service for an up front fee. These companies claim to have potential purchasers wishing to buy at lucrative prices but once the fees are paid sales rarely take place and, where they do, it is often at a selling price that barely covers the fees. Timeshare sellers may also try to persuade you to buy a better property on the understanding that they will sell your current property. The sale never happens and you are left with two timeshares.
4. Be aware of 'new' holiday products
   New forms of holiday products have appeared on the market designed to circumvent the provisions of the Timeshare Directive. Consumers should be aware of the differences between these products and traditional timeshare agreements and appreciate that they are not covered by the terms of directive 94/47. Please see the section on Holiday Clubs for more information.
5. Always seek independent legal advice before signing a timeshare agreement or timeshare resale agreement.