Timeshare and holiday clubs

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Timeshare (holiday) accommodation is usually offered while abroad and therefore by definition constitutes a cross-border transaction. In order to offer consumers within the European Union greater protection against what are often aggressive selling methods, a European Directive on timeshare contracts has been drawn up. This Directive applies in all Member States of the EU.

What does the Directive cover and what doesn’t it cover?

The EU Directive only applies to timeshare contracts with a minimum duration of 3 years and the right to spend at least 1 week a year in a holiday property. Timeshare is the right to spend a period of time in an apartment or other (part of a) property for a specified or specifiable period (e.g. 1 or 2 weeks a year) against payment of a lump sum and/or in instalments. In addition to the price for the timeshare you usually also have to pay periodic costs for services, maintenance and administration.

No protection against providers of 'holiday clubs'

The Directive offers no protection in the event you enter into an agreement with a 'holiday club'. This is an organisation offering sizeable discounts on luxury accommodation, flights, car rentals and cruises. Some providers also offer a ‘money back guarantee’ or ‘money back promise’. However, you first have to make a (sizeable) payment up front, frequently followed by instalments at a later date. In practice, most Holiday Clubs turn out not to be bona fide. The goods and services they promise are not provided and you lose any money you have paid.

What is the minimum information you should be given before signing?

Read the contents of the timeshare contract carefully before signing anything. The timeshare contract must contain the following minimum information:

  • Name, address and legal form of the provider and the owner.
  • What precise right of use you are getting and to what (i.e. an accurate description of the property and its location).
  • The price you must pay and an overview of all other charges (for services, maintenance, taxes, etc.).
    You may not later be charged any other costs than those specified in the contract!
  • If the property is still under construction: the scheduled completion date and other relevant details (planning permission, gas, water, electricity, swimming pool and other facilities).
  • Details of the management, maintenance of the property, servicing, repairs and administration.
  • Whether there is a system for exchange or resale and the associated costs.
  • The names and addresses of any persons to whom a withdrawal notice can be sent and details of how to cancel or withdraw from the contract.
  • Full details of the cooling off period you have after signing.

The contract must be provided in the language of your choice. This contract does not become valid until it bears the place and date of signing and has been signed by both parties.

Can you cancel the contract after signing?

Yes. You have a right to a cooling off period of 10 calendar days from the day you sign the contract. During the cooling off period you have the right to cancel the contract without giving any reason and at no cost. If the 10th day falls on a public holiday, the cooling off period extends to the next working day. If you cancel in writing, the date of sending the withdrawal notice will be the valid date of cancellation. You are advised to send your withdrawal notice by registered post.

What if the obligation to provide information has not been complied with?

If the timeshare contract does not contain one or more mandatory items of information, you have the right to cancel the contract within 3 months after signing. You will also not be charged any cancellation fee(s).

When do you have to pay?

You do not need to pay anything until the contract has become binding. In other words, not until the 10-day cooling off period has expired or – in case mandatory information is missing – after 3 months. Therefore, you do not need to respond to requests for earlier down payments or advance payments. If you have made a down payment and cancel the timeshare contract within the statutory cooling off period, you are entitled to a full refund of all money paid. If your money is not refunded you should contact your credit card company in order to have the payment reversed.

Don’t fall for aggressive or misleading selling techniques!

Sellers of timeshare deals as well as holiday club schemes use aggressive selling methods. For example, they approach you in the street and invite you to try your luck with a scratch card. They tell you that you are the lucky winner of a free holiday, cruise or bottle of champagne. To ‘claim your prize’, however, you have to go with them. Once there, you are likely to be subjected to high-pressure sales techniques aimed at getting you to sign up. But you will never get what you were promised. You can lose thousands of euros or end up being tied to long-term financial commitments from which it is almost impossible to withdraw.

Be wary of anyone offering to ‘help’ you sell on your timeshare!

If you already have a timeshare, you may be approached by organisations claiming to know or to be able to find someone willing to take over your commitments. For this service they charge you an administration fee – payable in advance. Don’t fall for it: they are unlikely to provide you with the promised service.

New EU rules being drafted

The European Commission is keen to offer European consumers even better protection against scams. The scope of the Directive will therefore shortly be extended to cover also:

  • short-term timeshare contracts (less than 3 years)
  • boats, caravans and other movable property
  • long-term holiday products, such as holiday clubs
  • resale or exchange of timeshare products

In addition, the obligation to provide information will be further tightened up and the cooling off period will be extended to 14 days. As soon as the new Directive becomes effective we will announce it on this site.

Tips:

  1. Read the full contents of any timeshare contract – before signing!
  2. Never accept any offer immediately. Take time to think it over.
  3. Keep a cool head. Work out whether it isn’t cheaper to rent holiday accommodation.
  4. Never make any down payment!
  5. Remember that it is very difficult to withdraw from a timeshare contract.
  6. Read the brochure of our colleagues from Ireland. This says it all!
  7. Be wary of organisations offering to take over your timeshare contract.