Brussels tightens screws on timeshare

Timeshare industry regulations will be overhauled to plug loopholes and restrict rogue operators after the European Parliament approved a Commission proposal.

The amended regulations aim to control new business in this sector such as cruise timeshare or holidays on boats and caravans around the EU, among others.

The new directive replaces the 1974 regulations and covers timeshare and long-term holiday products as well as exchange and resale.

The directive, approved by member states, will extend the scope of the 1974 rules to cover contracts of less than three years, movable property, long-term holiday products, such as discount clubs, and the resale of timeshare products.

Welcoming the EP's vote, EU Consumer Affairs Commissioner Meglena Kuneva said the new directive will give consumers peace of mind when they sign up for their dream holiday.

It lays down new rules on the right of withdrawal, choice of contract language, pre-contractual information and a ban on taking deposits during the cooling-off period. A provision for staggered payments for holiday clubs has also been introduced allowing new buyers to pay equal yearly instalments rather than a lump sum upfront.

"The new rules will ensure the best possible protection is in place for consumers in the modern holiday market and that rogue traders will no longer be able to exploit loopholes in the law," Ms Kuneva said.

Timeshare is popular in Europe. Malta is one of the hot-spots for this type of business with hundreds of holiday apartments and hotel rooms sold on timeshare basis.

Timeshare deals, which allow buyers to alternately occupy holiday accommodation for specific periods, have attracted millions of takers worldwide since the 1970s. They are often sold as a cost-effective alternative to renting, hotels or a second residence.

According to the Organisation for Timeshare in Europe, in 2001 there were 1,452 holiday centres in 25 European countries, 1.4 million families using this kind of accommodation and 200,000 Europeans employed in the sector, with sales totalling €2.3 billion per year.