There have been a number of reports recently that representations have been made to the Spanish Parliament concerning modifications to Laws 42/98 encompassing Law 4/12. Law 42/98 was enacted on the 5th January 1999 and put some strenuous rules in place regarding both the sales methods and terms governing timeshare contracts in the country.
In a nutshell, a timeshare contract retailed after 5th January 1999 may be deemed to have contravened the law if:
- The contract had a term of over 50 years (perpetuity).
- The contract was for floating weeks or points.
- The buyer paid any monies within the then 10 day cooling off period (extended to 14 days with Law 4/12).
- Buyers were not provided with the exact details of their occupancy rights.
Despite this law being enacted, many timeshare developers either didn’t understand the ramifications, or chose to ignore them. It took until 2015 for the first case to receive a positive judgement for the timeshare owner in the Madrid Supreme Court. This judgement paved the way for literally millions of Euros worth of claims being presented to the Spanish Courts.
Is the law really that tough?
Simple answer, not really. Being realistic, 50 years as a maximum is way more than enough for a timeshare contract; in fact it’s probably 30 years too long. TCA can think of no other purchase contact with the sort of term granted by Spanish timeshare law.
Bearing in mind the substantial funds required to purchase a timeshare, again, is it unreasonable to offer would be purchasers some time to think and mull over what could end up as a life changing decision, especially financially?
If the product is costed right, does what is says on the tin and fits your personal budget then 14 day to change your mind won’t make any difference. However, during the 14 days when research is carried out, because of the extremely negative comments that abound the internet regards timeshare, from a developer point of view a cooling off period is a seriously bad thing as many prospective buyers walk away. Anyway, no matter what is presented to the Spanish Parliament, the 14 days stays as this is a requirement of the EU Timeshare Directive 2008.
Regarding points and floating weeks, between the two of them they are totally responsible for the massive problems of availability experienced my many timeshare owners. The Spanish law basically makes owning a timeshare like it used to be, a fixed week in a fixed apartment at a fixed resort. Unlike points or floating timeshare, the purchase contract guarantees your holiday, so the product will actually work. Points and floating were only invented so developers could massively oversell their product and swell the corporate profit.
Yes this one is tough but the Spanish law is sensible, you actually get what you pay for, not buy into a lottery as to where, when or even whether you get a holiday.
Will Spanish timeshare law change?
It’s true to say that a number of interested politicians have submitted papers to the Spanish Parliament for law changes. What is interesting is that politicians normally lobby to strengthen consumer law, not so here. The proposed changes will weaken the robust laws surrounding timeshare and will play straight into the hands of the timeshare developers.
The good news is that the proposed changes have not even been debated in Parliament yet, and even if passed, there will still be a further 6 months to submit new claims. However after that honeymoon period has elapsed, the door could be firmly shut to new claimants.
TCA comment
Although pure speculation but one has to wonder what the motivation of these MPs is? It certainly wouldn’t be the first time that a politician has found him or herself in the pockets of big industry. What possible motive could there be for lobbying to reduce consumer protection?
Fair to say that the timeshare industry in Spain has, and still is suffering predominately caused by scant attention to the letter of the law, however in most cases this is a self inflicted wound and as they say, if you can’t do the time, don’t do the crime.
Whilst both the Spanish timeshare industry and interested parties will bleat that laws 42/98 and 4/12 have all but killed the industry, however, as we have reported on too many occasions to mention, the timeshare model is way out of vogue. Until the product is upgraded to attempt to bring it in line with the current travel and holiday requirements of today’s potential customers, then blaming the law is a lame excuse.
Nowhere in the Spanish statute does it say that timeshare developers cannot open their resort doors to non owners, probably the largest area of complaint from existing owners. Nowhere does it limit the rise in annual maintenance fees, the second largest of complaint. Nowhere in the law does it prohibit developers from creating workable exit strategies, the third major complaint.
Overall, it’s a fantastic piece of consumer protection legislation aimed at the most important part of the timeshare journey, the purchase. To make any changes will be to the detriment of the timeshare would be consumer and if changes are passed the Spanish Government must take responsibility for returning the timeshare industry to the wild west as it was in the 80s.
Finally, if you believe that you own a Spanish timeshare with an illegal contract and have considered making a claim. Just in the event that changes are made, it would be sensible to explore your options now because if the law changes then the door of opportunity will slam shut in your face.
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk