Summary of the UK Timeshare Regulations 1997

 

Summary of Key Provisions - The Regulations amend the existing UK Timeshare Act 1992.

a. Provisions retained from the 1992 UK Timeshare Act

  • Resale companies acting as agents probably remain outside the scope of most of the provisions of the Act but they will have to comply with its advertising requirements.
  • Notices of cancellation rights and blank cancellation notices (the so-called invitation to cancel) remain mandatory and must be given to all purchasers. It remains a criminal offence not to do so.
  • The basic cooling off period within which the purchaser can cancel the agreement remains 14 days, but this can extend up to 3 months and 10 days if the contract does not contain the prescribed information.
  • Timeshare credit agreements continue to be governed by the Act and are cancelled automatically when the purchase agreement is cancelled, but there are some new provisions relating to them (see below).

b. New provisions introduced by the UK Timeshare Regulations 1997

  • Points-based clubs are subject to all the provisions of the amended Act.
  • Insurance and share-based schemes come within the scope of the act for the first time. So products like Holiday Property Bond will be subject to the Act.
  • Independent providers of consumer credit are more exposed to claims than they were under the un-amended Act. Previously, credit agreements were only caught if the credit provider knew or had reasonable cause to believe that his credit was being used for a timeshare purchase. Now, any credit arrangements between the provider and a timeshare company can result in the creation of timeshare credit agreements within the meaning of the Act.
  • The act will apply to timeshare sales made to UK nationals in any other European Economic Area (EEA) state. The EEA includes all EU Member States. It also applies (in theory at least, world-wide) to any scheme which includes timeshare accommodation in the UK. Under international conventions, judgements obtained by individuals in UK courts must be enforced without re-opening the case, by courts of other EEA states.
  • All advertisements for timeshare must refer to the relevant disclosure document (see below) and say where it may be obtained. Failure to comply is a criminal offence.
  • There is an absolute ban on advance payments either to the seller or to a third party. It is a criminal offence to contravene this provision.
  • Purchase contracts must contain all the information specified in the Schedule to the Regulations, a criminal offence is committed if they do not. The contracts must be translated into the purchaser's language (if s/he is an EEA national or resident). The same rules regarding the translation apply to the disclosure document. If any timeshare property is in an EEA state, a certified translation of the purchase contract must also be provided. In both cases, a criminal offence is committed if a translation is not provided. The Act has created six new criminal offences which have been highlighted above, where one previously existed