• Timeshare

    Timeshare

    The nature of these agreements is usually for the consumers to purchase the right to use accommodation at a particular holiday resort or other type of accommodation. These can...

  • Consumer credit contracts

    Consumer credit contracts

    These are basically finance...

  • Cashback

    Cashback

    Not really a holiday products as such, but the ECC-Net has found that they were widely used by the marketing companies as an enticement to join holiday clubs, etc.

    The...

  • File a complaint

    File a complaint

    ECCs are only competent to take action on EUROPEAN cross-border issues. This means complaints of consumers living in an EU member state or Norway or...

 

Not really a holiday products as such, but the ECC-Net has found that they were widely used by the marketing companies as an enticement to join holiday clubs, etc.

The idea behind this is for the consumers to receive a cashback certificate with a face value equivalent or close to the purchase price of the holiday product (e.g. a holiday club membership) on offer. Unscrupulous representatives tend to portray this as a way of getting the entire sum paid for the product on the day repaid to their clients in a few years' time.

The reality of the situation, however, is that these effectively are separate agreements governed by their own set of Terms and Conditions. The latter often include the minimum and the maximum proportion of the face value that can be paid out to consumers in case of their claim being successful. In some cases, the minimum proportion can be set as low as five or ten percent and it needs to be appreciated that payment of such proportion can be argued as the agreement being fulfilled in accordance with its Terms and Conditions.

Terms and Conditions also tend to make the claiming process fairly complicated and there is usually a very small window of opportunity to send the documents to the cashback scheme operator. The ECC-Net has found that ANY deviation from the process set by Terms and Conditions would normally result in the claim being dismissed.

Another potential issue is that the cashback company may go out of business before the bulk of claims is matured in accordance with Terms and Conditions. This usually results in the consumers needing to make  claims through the companies' liquidators, which often means that they will only be able to claim a proportion of the amount due to them, if anything at all.

It needs to be emphasised that cashbacks DO NOT constitute a part of the holiday product contract and are provided by third parties; hence it may not be possible to make claims against third parties like banks or credit card companies in this respect.

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Are you about to enter into a timeshare contract? Take the following into account:

  • You do not need to sign the contract immediately. The seller must give you all the information in good time before you sign the contract.
  • After the signature of the contract you have 14 days to change your mind and during this cooling off period you can cancel your contract free of charge (you have a right of withdrawal).
  • It is prohibited to ask for an advance payment during the cooling off period.
  • The seller is obliged to provide you with all information about the contract and to give you a withdrawal form (via which you can exercise your right of withdrawal).
  • Check to make sure that this is really cheaper for you.
  • If you sign a long-term holiday product contract, the contract must contain a payment schedule of instalments. Any payment of the price stipulated in the contract outside the payment schedule is prohibited. Payments are divided into equal annual instalments.
  • Beware of aggressive sales techniques: companies selling timeshares often invite people to presentations using different luring techniques. Consumers are typically approached at holiday resorts and offered a scratch card which invariably reveals a prize. To avail of the prize consumers are told they have to attend a nearby office to listen to a “short” presentation. These presentations often turn into lengthy sales pitches and consumers can be put under pressure to sign a contract without proper consideration of its terms and conditions.
  • Consider the financial consequences: A timeshare could turn out to be a burden on your finances in the long run, particularly if it incurs additional expenses or there are difficulties reselling it. Consumers should consider the financial implications very carefully before signing up.
  • If you plan to sell your timeshare or long-term holiday product contracts be extremely wary of suspicious resale companies: These companies may claim to have potential purchasers wishing to buy at lucrative prices but quite often, the resale does not take place. These companies may not demand any payment from you before the actual sale of your product. Consumers may also be persuaded to buy a better product on the understanding that the resale company will sell their current product. This may lead to consumers ending up with two timeshares/holiday club memberships and no resale takes place!
  • Independent legal advice: consumers are strongly advised to seek independent legal advice before signing a timeshare/holiday club agreement or resale agreement.
  • Be extremely cautious of companies employing aggressive sales techniques: A reputable company will allow you to take a copy of the contract home and give you time to consider your options.
  • Terms and Conditions: If you have already signed up to a timeshare and wish to cancel it, check the terms and conditions of your contract carefully. Put your request to cancel in writing to the company immediately. You may also wish to consider contacting your credit card company to see if it can offer any assistance.

Be extremely cautious if you want to resell your timeshare or long-term holiday product (membership in a holiday club): The ECC regularly receives reports about organisations that want to help you resell your timeshare contract or membership of a holiday club for a fee. There are also so-called lawyers who claim that they can get your original investment returned through a lawsuit against the seller. Since we have never heard of a successful resale or outcome of litigation in this branch, we advise you not accept this type of proposal. There seems to be no market for resale. By numerous lies, dishonest sellers can extort large sums from you and this ultimately does not produce anything. Remember that a lawyer or consultant never represents your interests on his/her own initiative. As  you are the only party interested to resolve your situation, you should always take the initiative yourself.

 

The money back from the bank/card issuer when the seller does not respect your rights after the Directive

Many consumers are not aware of their rights to get their money back from the bank/card issuer when the seller rejects their claim or for other reasons do not reimburse the consumer. The procedure involving a reimbursement from the bank/card issuer is called chargeback. Reasons to turn to the bank/card issuer for a chargeback may be when the seller does not respect the consumers’ rights of withdrawal or cancellation of the contract, but also if the trader has gone bankrupt. 

In many countries/situations, consumers, who have used a credit card for their transaction, will have a right to be reimbursed if the trader does not respect their consumer rights (e.g. the ban of advance payment during the withdrawal period). If you have used a debit card, you might also be protected according to national legislation or the card companies operating rules. Certain conditions may have to be met in order for the consumer to be allowed to make a claim against the bank/card issuer. Such conditions may for instance include that the consumer makes an unsuccessful claim with the seller first. 

How to proceed: Send a written complaint to the bank/card issuer. If the card issuer/bank rejects the claim, you can send the case to the relevant ADR/mediators. You have to act swiftly as deadlines may apply. You can contact your national ECC for further information about your rights and the conditions to claim your money back by the chargeback procedure.

 

 

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