Consultation on the Timeshare Directive
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Issued 12 July
2010
The Government is moving to strengthen consumer
protection around holiday timeshares with its new consultation.
The Department for Business is seeking views from
businesses, consumers, enforcement authorities, and other interested parties
on the transposition of the European Commission’s new Timeshare Directive into
UK law. This will introduce common rules across the European Community by
February 2011 and set the conditions for fair trading in timeshares.
Action at a European level was necessary because
of the cross-border nature of the sale of these products, and the exposure to
detriment that consumers can face in this market.
Consumer Minister Edward Davey said:
“Tourism plays an increasingly important role in
the economies of Europe and introducing common rules will benefit vulnerable
consumers and the people who currently fall prey to bogus operators while they
are on holiday. Implementing these regulations will boost consumer confidence
in the genuine timeshare industry, and help eliminate the rogue traders that
bring the industry into disrepute and cause consumers problems.
We intend to provide a simpler, more easy to
understand framework within which genuine operators in the UK can thrive.”
The proposed regulations include a range of
provisions to improve UK consumer protection in a number of areas. For
example:
Long-Term Holiday Products, also known as Holiday Clubs cause
by far the most consumer detriment in this sector and are covered by
regulations for the first time.
Timeshare coverage is extended to any overnight accommodation, which
includes, for example, timeshare in caravans and boats and rights to access
accommodation in a pool of accommodation.
Timeshare Resale is an area rife with operators who seek payment
up-front on the bogus promise of a sale. This is covered by regulations for
the first time.
Timeshare Exchange is covered for the first time and important
pre-contractual information, such as any restrictions on the choice offered
under the exchange scheme, must be provided.
Notes
1) The full title of the consultation
is: CONSULTATION ON THE PROPOSED TIMESHARE, HOLIDAY PRODUCTS, RESALE AND
EXCHANGE CONTRACTS REGULATIONS 2010. You can find the consultation here:
http://www.bis.gov.uk/Consultations/timeshare-holidays-exchange-resale?cat=open
2) The consultation is open for 12
weeks and closes on 1 October 2010. The Government shall aim to respond by the
end of October 2010.
3) The consultation is on the
transposition of the European Commission’s Timeshare Directive, which was
adopted by the UK in February 2009. This looks at:
· Long-Term Holiday Products,
also known as Holiday Clubs - contracts of more than one year in duration
by which a consumer acquires access to promised discounts on accommodation and
other travel services. Sellers will have to provide standardised information
about the product as part of the contract. The contract will then be subject
to a 14-day “no-strings” cooling-off period during which no payment is
permitted. And the seller can only take yearly payment throughout the
contract agreement, with the consumer able to terminate the contract as each
payment becomes due.
· Timeshare - contracts of
more than one year in duration by which the consumer acquires the right to use
overnight accommodation for more than one period of occupation.
Pre-contractual information provision is extended and substantially
standardised and the cooling-off period extended from 10 days to 14 days
Europe-wide. The ban on up-front payments is retained.
· Timeshare Resale -
contracts by which the trader assists a consumer to sell or buy timeshare or a
long-term holiday product. The new regulations require the trader to provide
important pre-contractual information, a 14-day cooling-off period, and
disbars the trader from accepting any payment until the sale of the timeshare
is complete or the contract is otherwise terminated.
· Timeshare Exchange -
contracts by which, via membership of an exchange scheme, consumers in
exchange for providing temporary access to their timeshare rights acquire the
right to access other overnight accommodation or other services. Most
memberships are sold at the same time as a timeshare purchase and the consumer
will have the 14-day cooling-off period attached to the timeshare sale in
which to reconsider. When exchange membership is bought separately from a
timeshare purchase the consumer has a separate 14-day cooling-off period.
About the Author
© Crown Copyright. Material taken from the BIS Department
for Business, Innovation and Skills. Reproduced under the terms and conditions
of the Click-Use Licence.
