[ARCHIVED CONTENT] Timeshare Guide

Please note: This document is only a guide and should not be relied on as a statement of the law. To understand your rights and obligations fully, study the relevant law or consult a solicitor.

The European Economic Area comprises the Member States of the European Union (i.e. United Kingdom, France, Germany, Italy, Netherlands, Belgium, Luxembourg, Ireland, Denmark, Greece, Spain (including the Canaries and the Balearics), Portugal, Austria, Sweden and Finland) together with Norway, Iceland and Liechtenstein.

Timeshare means buying the right to spend a set period in a holiday property each year for three years or longer. Most timeshare resorts are linked to an exchange organisation that offers to arrange exchanges with owners in other resorts, normally for a fee.

Many people have bought timeshares and have enjoyed using them. However, timeshare touts operate in some resorts. DTI receives many distressing letters from people whom touts have pressured into buying timeshares they do not want and cannot afford.

The "buy-sell con". If you already have a timeshare, a timeshare seller may try to convince you to buy a better one on the promise that he or she will sell your existing timeshare to pay for it. Under the "buy-sell con" this sale never materialises and you will be left with the expenses of both. Remember that the second-hand value of most timeshares is far less than the price when new.

Some companies sell timeshare by getting people to go to sales presentations. They may offer gifts or free holidays to persuade you to attend. They may suggest you have won a competition and say you have to go somewhere to get the prize. Only after you have arrived do you find out that they are trying to sell you a timeshare.

The Timeshare Directive gives timeshare buyers rights throughout the European Union. It applies to any timeshare contract made under the law of an EU country or where the property is in the European Economic Area (EEA).

Some countries, like the United Kingdom, have given the timeshare buyer more protection than the Directive requires. All Member States must give buyers of timeshare apartments and houses the protection and rights set out below.

Information which must be in the brochure and which forms part of your rights if you agree to buy a timeshare

Be particularly careful if you sign a contract outside the UK as you are unlikely to be protected by UK law. If you run into problems, you may have to go to a foreign court which could cost you lots of money and trouble.

The Timeshare Act 1992 already gives buyers protection. The Timeshare Directive gives additional rights, and the Act has been amended to include these rights. If your contract is made under the law of the United Kingdom, the amended Act applies. If you borrow money to pay for the timeshare, and you tell the lender that it is for a timeshare, or if you use a credit card, this agreement is also covered by the amended Act.

If in doubt whether a timeshare contract is governed by UK law, you should ask a solicitor or at a Citizens Advice Bureau, Consumer Advice Centre or Trading Standards Department. A contract you sign in the UK is likely to be covered by UK law.

There are a number of other holiday products which although related to Timeshare are NOT currently covered by the legislation, these include:-

Holiday and Vacation clubs

These are schemes whereby consumers purchase what amounts to a promise by the club to provide them holidays for a very long period into the future (sometimes their lifetime). These schemes look very like timeshare but they are not covered by Timeshare legislation as membership of the club is not linked to any rights in any particular property. Instead the club offers them the opportunity of holidays in a variety of different locations.

A number of these types of holiday/vacation club memberships are sold by classic "bait and trap" tactics. Individuals receive offers of free holidays or gifts, often in the form of scratchcards from street vendors, in return for attending a presentation about the scheme. At the presentation, high pressure selling methods are used, sometimes over the course of several hours. Some consumers sign up in order to get away only to find that there is no right to cancel and they have lost their money (consumers who sign contracts and pay deposits outside the UK are not protected by UK law).

Timeshares of less than 3 years duration

These fall outside the scope of Timeshare legislation which defines timeshare as giving purchasers rights for a period of not less than three years. To avoid the legislation applying timeshare contracts can be offered for a 35 month period, sometimes with an option to extend the duration once the 35 months is up.

Timeshare in floating vessels (e.g. narrow boats, pleasure boats & houseboats)

The Timeshare legislation does not cover timeshare in any form of boat or ship.

Timeshare resales

There are a number of long standing bad practices in this area to watch out for (see also the "buy-sell con" in Section 1 There are some disreputable companies who offer timeshare owners, wishing to sell, a marketing service at a price (up to £700 in some cases). These companies often claim to have many potential purchasers wishing to buy. But once the fees are paid, sales rarely result and, where they do, it is often at a price that barely covers the fee. Individual owners wishing to sell have no protection under Timeshare legislation in cases such as these*.

*Note Whether timeshare resales are subject to the Timeshare Act 1992 depends on whether the vendor acts in a private capacity or in the course of a business. If the vendor, for example, is a company selling a timeshare from its own "stock", and is selling it in the course of a business, then the sale is covered. If the vendor is a private individual who has engaged the services of an agent to market his timeshare (the more usual course) then it is not covered.