Tourists regret buying memberships in holiday clubs

26. August 2015

Think twice if you are offered a membership of a holiday club on your vacation in Southern Europe. The European Consumer Centers Network (ECC-Net) have heard from numerous Nordic consumers who regret the contract they signed during vacation – and subsequently find difficult to get out of.

Imagine this. The sun is shining and all your daily problems seem far away, as you rest on a sunbed during your holiday under Southern skies.  Suddenly, a young blond female approach you in a Scandinavian language. She beams as she offers you a scratch card. You reflect nothing of it and accept the scratch card. Unexpectedly you win the main prize; an iPad!

The young female – who presents herself as Laila – tells you that you must follow her to her office in order to collect your prize. Next thing, you and your spouse leave your sunbeds and hail a taxi accompanied by Laila.

An offer that is hard to refuse

After a 20 minutes sizzling taxi ride you reach the office. Laila introduces you to her associate Magnus, who invites you into a patio at the rear of the building.

While talking about your holiday traditions with Magnus, an assistant serves you cool drinks and snacks. You feel at ease. Then, Magnus propose a tempting offer; membership of a holiday club that will guarantee discounts on travel, flights and inexpensive accommodation at luxury hotels.

It is a bargain, Magnus says. The 2-year agreement guarantees four trips with great discounts. As payment you should make a deposit of 1000 euro now and two installments of 1000 euro during the next year.

Instantly you feel alarmed; it is a lot of money. But Magnus is very compelling, and gradually he makes you understand how advantageous this deal really is. He presents you with glossy brochures and a contract, which you read thoroughly, twice.  Magnus tells you it is a one-day offer and hands you a pen. You look at your spouse. Should we sign the contract?

Complaints about holiday clubs

Be cautious! Experience shows that this is a signature that many consumers subsequently regret.

The last three years almost 800 consumers from Denmark, Sweden, Norway and Finland have complained to the Nordic ECC offices about holiday club agreements.

Holiday club presentations can be very high pressure. Afterwards the consumers feel ripped off, as they have not fully understood the content in the contract. In average Nordic consumers has paid more than 3000 euro for a membership, and some have paid up to 8000 euro. 

"The common characteristics of the inquiries about holiday clubs are that the agreements are unclear and difficult to understand. There may be conditions in the agreement that make it difficult for the consumer to actually take advantage of holiday club offers. For instance, it may be a requirement that the consumer fly with a particular airline," says Lars Arent, director of ECC in Denmark.

Most of the holiday clubs reported to the ECC-Net are located in Spain. The consumers – often elderly couples with credit cards – are lured to the holiday club's office by a Northern European salesperson, where the consumers are then confronted with intense marketing of the holiday club's products.

Difficult to cancel an agreement

The consumer is entitled to cancel an agreement within 14 calendar days if the contract with the holiday club has duration of more than one year. The time limit of 14 days runs from the day they sign the agreement. The agreement should be cancelled in writing, e.g. sending an e-mail to the salesperson or using the standard form, if they have received one.

If the consumer did not receive information about the right to cancellation the period may well be longer than 14 days. If they have paid money to the salesperson in connection with signing the agreement, the consumer should ask to have this money refunded to their account.

"In reality it can be very difficult for customers to get their money back. Some holiday clubs are non-responsive to attempts to cancel, they refuse to refund a deposit they have taken, or they even lie about the ability to cancel," says Lars Arent.

If the consumer has paid money to the salesperson and received neither a confirmation nor their money back within the 14-day period, he or she can ask the bank to refund their money if they made the payment using a credit card.

If a holiday club is uncooperative, the consumer should contact the ECC office in their home country, where they will get further help with the case.

What is a holiday club?

As a member of a holiday club you pay a membership fee and commit yourself for a specific time. In return, the holiday club guarantees you discounts on travel, flights and inexpensive accommodation at luxury hotels. But it is often difficult to figure out what the deal is actually about.

The holiday clubs do not sell real estate or user rights for real estate, as we know it from the timeshare sector.

Most of the holiday clubs reported to the ECC-Net are located in Spain.

Holiday club agreements signed in a European Economic Area (EEA) country are protected by the Timeshare Regulations. Check if your holiday club agreement is covered by the regulations.

Film about holiday clubs

Tips before signing a contract

Tips after signing a contract

  • Respond immediately if you regret signing a contract – make sure you cancel the contract within the deadline.
  • Read the contract– does it say anything about a right of cancellation?
  • If you have not received information about the right to cancellation you may be subject to a cancellation period longer than 14 days.
  • Cancel the agreement in writing, e.g. send an e-mail to the salesperson.
  • You can ask your bank to refund your money if you have paid with credit card.
  • You can contact the ECC office in your country for further help with your case.

 

26. August 2015

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