New EU timeshare regulations

Holiday & Travel NEWS: Consumers across the EU are set to benefit from greater holiday protection when they buy and resell timeshare holidays under new rules, after MEP’s voted to endorse the new timshare directive.

The aim of the Directive is to further boost consumer confidence in the timeshare industry, which is worth over €10.5billion and responsible for more than 40,000 jobs across the EU, and to eliminate the rogue traders who cause problems for consumers and bring legitimate operators into disrepute.

It also aims to provide a clear definition as to what is and what isn’t timeshare property.

Until now, EU rules on timeshare have given consumers basic rights with regard to clear information, the right to withdraw and change their mind, and a ban on deposits.

The new Directive would extend the scope of the 1994 EU Timeshare Directive to cover new products which have emerged on the market like discount holiday clubs, and “timeshare-like” holidays on cruise boats, canal boats and caravans.

It would also extend protection to important areas like timeshare resale and exchange clubs and new schemes that fall outside of the existing timeshare legislation.

The new Directive will replace the old one with a modern, simplified and coherent framework, covering timeshare and long-term holiday products, as well as exchange and resale. The proposal will extend the scope of current rules to cover:

Shorter term contracts – contracts of less than three years will now be covered.
Moveable property – the rules will cover contracts for timeshare on property such as canal boats, caravans or cruise ships.

Long-term holiday products – these include holiday discount clubs, where consumers pay for instance 3,000 euro to get a password to a website, where they are promised “huge discounts” which are often misleading, on holiday accommodation, flights and rental cars.

With the new rules, the traders will not be able to request the entire payment for the membership of such clubs upfront; consumers will be able to pay instead by yearly instalments.

Resale of timeshare products – many timeshare owners are approached by commercial agents who ask for a fee in return for selling their timeshare.

Exchange of timeshare products – some timeshare owners pay an additional fee to join an exchange club, where they can swap their week in e.g. the Canaries for a week in the Alps. Additional information requirements should ensure they get a realistic picture of the offer and they do not end up being disappointed.

The lack of regulation of long-term holiday products, re-sale and exchange schemes 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.

The new Directive will enhance consumer rights in the market for timeshare and long-term holiday products, and create a level playing field for the sellers of these products.

The EU said that timeshare is a strong, consolidated market in the UK, Sweden, Germany, Italy, Portugal and Spain, while it is quickly growing in the Czech Republic, Hungary and Poland.