The notes below summarise the questions that commonly arise under The 1997 Timeshare Regulations.
It is important to bear in mind that the Regulations do not apply if you purchase an accommodation arrangement which comes to an end within three years – this is more commonly known as a "holiday pack".
What is a cooling off period?
This is the period of time that starts, normally on the day of signing the purchase agreement, and commonly runs for a period of 10 days in Spain and 14 days in the UK. During this time you have the opportunity to make sure that you feel happy and secure with your purchase. It is normal practice for the sales person to ask you when you will arrive back in your home country. What normally happens is that they will ring you out of courtesy to make sure that you are still happy with your purchase – this is not designed to badger you and is your chance to ask any questions that you are not clear about or forgot to mention. Once the cooling off period has expired you will then be liable to pay for the timeshare.
Cooling off periods in the European Union
Legislation to implement The European Timeshare Directive has now been adopted by all EU Member states and provides for a 10-day minimum cooling-off period.
There is additional consumer protection required in this Directive, but the most significant is the provision of a full information document (‘Disclosure’) in your own language.
Cooling off periods in the UK
You are entitled by virtue of the UK Timeshare Act 1992, as amended by the Timeshare Regulations of 29 April 1997, to a minimum 14-day ‘cooling-off’ period.
These Regulations do not allow the vendor to collect a deposit from you during that time.
These Regulations do not, however, cover timeshare of boats (e.g. canal cruisers). Therefore any contract you have signed for this type of arrangement will be immediately binding and the seller will expect you to complete the contract by paying the balance.
You should also be aware that legislation does not cover timeshare resales. However, TATOC will be happy to recommend resale companies affiliated to OTE who will offer a cooling off period to purchasers (resale advice available on request).
If you decide to cancel an agreement
If you wish to cancel during the cooling off period, it is important that you communicate this in writing by recorded delivery to the seller’s office. Remember that if two people signed jointly, both should also sign the cancellation letter or Formal Notice. You should give the contract number and the date on which you signed the agreement. Posting the cancellation recorded delivery relieves you of any responsibility to prove that you actually posted the cancellation. You are not required to give any reason for the cancellation.
You should also cancel, in writing, any loan application that you might have signed at the same time. Again, if this application has been jointly signed, both signatories need to sign the cancellation letter and post it recorded delivery, giving the finance provider your appropriate reference number.
What happens when you are outside any cooling off period?
If you are unhappy with your purchase and feel that you have a genuine complaint, it is best to (jointly) sign a letter of complaint and to send it recorded delivery to the timeshare resort in question rather than writing to its Trustees or head office elsewhere. Set out concisely what your complaint is about and what action you expect the company to take. Ensure that you include a copy of your purchase agreement, disclosure statement and any other relevant correspondence to support your claim.
If you believe you were misled by the seller in the UK
If your complaint concerns a timeshare seller in the UK and you are outside the 14-day cooling-off period before you discover that you have been misled, you can take up the matter with your local Trading Standards Office, which may be able to offer further advice or possibly take the complaint up directly with the trader.
In addition to the Timeshare Regulations of 1997, there is also a considerable amount of consumer legislation in this country, which is designed to outlaw misrepresentation. The Trading Standards Office will take up your complaint direct with the trader and their recommendation could be that you receive a full refund.
Rights of redress if you paid by credit card (Visa and MasterCard payments)
If you paid by means of a credit card, you should be aware that Visa introduced a rule in November 1996 (which is not linked to any legislation) and MasterCard more recently (which is linked to the EU directive), which set out that a customer buying timeshare with a credit card is entitled to a 10-day cooling off period, irrespective of whether there is local cooling off legislation in place or not.
The 10-day Visa/MasterCard cancellation and cooling-off rule is particularly relevant in areas of Europe that are not subject to the European Timeshare Directive as they are outside the EEA area (e.g. Malta) and for ‘Holiday Pack’ purchases. ‘Holiday Packs’ are of duration of less than 3 years and frequently offer the option of extending the contract for up to 50 years or more. The EU Timeshare Regulations do not provide for a cooling-off period for this type of product. However, Europay, which is responsible for EuroCard/MasterCard, and Visa do grant a 10-day cooling off period for Holiday Packs. This gives further protection to customers who have paid a deposit for the purchase of a holiday pack, even if the company refuses to refund.
General guidance notes on how to cancel a timeshare purchase and retrieve payment made by either Visa or EuroCard /MasterCard
All those who signed the timeshare purchase agreement should send a jointly signed cancellation letter by Recorded Delivery post to the timeshare operator, quoting the purchase agreement number and asking for cancellation of that agreement and return of the deposit. The date of signing the timeshare purchase agreement counts as day one of the Visa and MasterCard 10-day ‘cooling-off’ period (and includes Bank Holidays and weekends) and the letter of cancellation must be posted – with post office evidence of postage – within those 10 days.
The credit card holder(s) should write by Recorded Delivery to the card-issuing bank and inform them that you have decided to cancel the timeshare purchase agreement and, as you are aware of the Visa and MasterCard rules, you are asking the card company to assist in the full retrieval of all monies. The customer(s) should provide the bank with copies of the letter of cancellation, the Recorded Delivery postage slip, the transaction slip, which will set out the ‘merchant name’ of the timeshare vendor and a copy of the Purchase Agreement and its terms and conditions. You should request that Visa/MasterCard firstly put the deposit figure in the ‘disputes section’ so that it does not attract interest on the ‘debt’ and secondly ask them to retrieve the monies from the company that has taken your deposit - its name will be set out on your transaction slip. It is simply the timeshare deposit payment that should go into the ‘disputes area’.
The credit card payment may well have reached the ‘merchant name’ on the transaction slip you have signed, i.e. the timeshare vendor company, but this does not matter. Visa/MasterCard will commence the reclaim procedure once you have notified your card issuing bank that issued you with your Visa or MasterCard account facilities.
Should there be reminders from the timeshare vendor that it requires the balance to be paid, it would be wise to respond again by Recorded Delivery pointing out that you are using the Visa/MasterCard rules to cancel the purchase agreement and therefore, you will not be paying the balance and they should desist attempting to collect this sum from you.
Rights of redress if you paid by credit card (other credit cards)
Other credit card companies have not adopted the Visa/MasterCard rule and offer no help should you have changed your mind since signing the purchase agreement. Whilst the intention of the European Timeshare Directive was to regulate the industry on a pan-European basis and to give consumers protection by ensuring, amongst other safeguards, a minimum 10-day cooling-off period, at the present time it is difficult to persuade credit card issuing banks that they have any obligation in assisting you to enforce those rights.
Redress under the UK Consumer Credit Act 1974 Section 75: if you paid at least partially by credit card
Credit card companies (all subject to the UK’s Consumer Credit Act 1974) have a duty of care under Section 75 of that Act to assist customers where they have demonstrably suffered from misrepresentation or failure on the part of the ‘merchant’ taking payment to deliver goods and services.
You should write to your credit card issuing bank sending photocopies of your purchase agreement, its terms and conditions, and your letter of complaint to the timeshare company so that they are fully aware of all the facts of the case. If the resort has responded but you consider the response unsatisfactory, tell both the resort and the bank on what grounds you continue to feel aggrieved. If the timeshare company is totally adamant that it will not agree to cancellation of the contract and deposit refund, you can demand that the bank provides you with a refund. Whilst the bank will hope to have the money returned by the company named on your transaction slip, even if it is unsuccessful it must still accept responsibility under Section 75 of the Consumer Credit Act 1974.
Resorting to legal action
If you feel that your genuine grievances are being rejected both by the timeshare company and by your credit card issuing bank or finance company regulated by the Consumer Credit Act 1974, you could consider obtaining a free quotation from a solicitor for handling the claim. Or you could refer the claim against your card-issuing bank to the Banking Ombudsman (pamphlet available from + 00 44 (0)20 7404 9944).
It is worth looking at your insurance policy to see if legal costs cover is included. A single call to your insurer should give you this information. If you have the cover you will be informed as to how to progress your dispute with the timeshare company concerned.
You will need to visit your local police station to report the crime and to make a written statement. This must be typed to ensure all necessary parties can read the statement. Any documentary evidence should also be properly exhibited and attached to the statement. The statement should be translated into the language that has the jurisdiction of the crime.
The police should then forward the statement to Interpol. Interpol will check the quality of the statement as well as that any documents attached are correctly mentioned in the statement; they will then forward it to their colleagues in the appropriate country.
If the police will not take a statement, as it is a crime that is not within their jurisdiction, consumers should remind them that the police have a duty to gather and save evidence of crimes and a duty of care for victims. Also the correct action is to forward details and evidence of crimes abroad via Interpol for the overseas law enforcement agencies to investigate. (Remember that it is unacceptable to expect the police to drop everything to take a statement. Consumers should be prepared to arrange a mutually agreed time and date when an officer will be free to take the statement from you).
Lawyers List
If you need to use the services of an independent specialist whether you want to buy, sell or seek further professional advice, we have put together a list of highly qualified companies who will be in a position to advise you accordingly.
1. Brechin Tindal Oatts
48 St Vincent Street
Glasgow
G2 5HS
Tel: 0141 221 8012
Fax: 0141 221 7803
www.bto.co.uk
2. HOWARD KENNEDY
19 Cavendish Square
London
W1A 2AW
tel: 020 7636 1616
fax: 020 7491 2899
www.howardkennedy.com<
3. John Howell & Co
The Old Glass Works
22 Endell Street
Covent Garden
London
WC2H 9AD
Tel: 0207 420 0400
www.leisuresolutions.net
4. Needham & James
1 Waterloo Street
Birmingham
B2 5PG
Tel: 00 44 121 644 4400
Fax: 00 44 121 633 4450
www.needham-james.co.uk
5. STONES
Linacre House
Southernhay Gardens
Exeter
EX1 1UG
tel: 01392 666777
fax: 01392 666770
www.stones-solicitors.co.uk
6. Wilson Browne Solicitors
PO Box 8
41 Meadow Road
Kettering
Northamptonshire
NN16 8TN
Tel: 01536 410 041
Fax: 01536 410 444
www.wilsonbrowne.co.uk
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Consumer Help FAQs Your Rights - important information
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