At beach resorts, young people often walk up to vacationers and offer scratch cards or perform customer surveys, and the prizes or other rewards then have to be collected elsewhere. What almost always awaits the vacationer is some sort of a holiday product presentation. In addition to traditional timeshares, the offerings include holiday club memberships, but buying such a membership does not entitle the buyer to use a specific destination for a week each year, for example. What the person buys instead is a membership whose terms and duration vary. During the validity period, the member can use the destinations and supplementary services offered by the club.
Unfortunately some of the club memberships are sold with the intent to mislead, and some cases may constitute sheer scams. The challenge is to ensure whether or not one receives money’s worth for the expensive club membership. In the worst cases, consumers have noticed they spent thousands of euros on a pile of paper instead of the luxury vacations they were promised.
Bells should ring if:
- The seller asks for a membership fee worth thousands of euros for several years of membership in advance, or any other advance payment, such as a deposit.
- The holiday club is advertised as a profitable investment whose value will increase and which is easy to resell. In almost all cases, these promises are unfounded, and marketing holiday clubs as investments is forbidden in the European Union.
- The deal is said to contain a deposit, warranty or investment system that operates on a “money back” basis. The holiday club salesperson does not usually deal with these systems. Instead, they are handled by another company whose operations remain virtually unknown to the customer. It is very unlikely that customers receive the profits they have been promised, or even a refund of the money they have invested.
- The holiday club salesperson gives oral promises that are not written down in the contract.
- The salesperson presents imposing catalogues of the holiday resorts contained in the membership, but does not provide written information on the destinations, their addresses, overall quantities, reservation systems, the terms of reservation, or all expenses related to the membership or using the destinations. Within the European Union, legislation provides that certain information be given on a standard information form (p. 9).
- The salesperson demands that the contract be signed immediately without allowing time for familiarisation, does not offer a 14-day cancellation period, or provide information on termination.
- Make sure what kind of a holiday product you are offered. How long a commitment is required, what services will you receive, at which destinations and when?
- Do not trust a salesperson’s promises without receiving them in writing.
- Do not sign a contract which you have not had the time to read, which is in a foreign language, or which you do not fully understand.
- Always demand detailed information on the seller, the sales article, maintenance charges and the way they are determined, as well as all other terms and conditions related to the deal in advance, in writing, and in your own language. Within the European Union, the seller must provide you with a standard information form on the sales article in your own language.
- Find out all expenses related to the use of a timeshare or holiday club (the initial investment, maintenance charges, the annual membership fee, flights etc.), and compare them with the expenses of other ways to spend your vacation.
- Do not make any payments at the presentation or during the 14 days right of cancellation!
- Stay alert if a timeshare or club membership is advertised as an investment that bears annual interest, significant rental revenue or increase in value, or if you are promised that the share/membership is easy to resell.
- Stay alert if you are told at a presentation that they already know a buyer for your existing timeshare who is willing to pay a good price as long as you first buy a new share or club membership. Such a buyer may not exist and you end up with two holiday destinations.
- Make sure that you receive a written undertaking to the 14 days right of cancellation and instructions on how and where to make a cancellation. The cancellation must be made in writing, preferably via a registered letter.
If you want to cancel a deal but you have already made a deposit payment by credit card, inform both the seller and your credit card company about the cancellation, and also ask the credit card company to cancel or refund the payment.
If the seller or marketer is located in another EU country, you can contact the European Consumer Centre in case of problems.
European Consumer Centre