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Timeshare Law
A comprehensive Spanish law regulates important legal aspects of timeshare itself and provides consumer protection that brings the country into line with European timeshare regulations.
Putting a crimp into the high-pressure selling techniques of the timeshare touts around bus stations and tourist spots, the law provides a 10-day cooling-off period during which no deposit may be taken and the buyer can withdraw from the contract he has signed without any penalty.
Furthermore, the law requires that the timeshare operator provide full information and a contract in the buyer’s own language. If any element of the purchase does not meet the brochure or written description or match the contract terms, the buyer has a further three months to rescind the contract unilaterally with no penalty.
The law also provides that any loan that the buyer may have taken out to purchase the timeshare will also be cancelled. This has put an end to the situation in which buyers found they were still liable to pay back to the hank tempting low-interest loans they had accepted from the time-share company.
The law also provides that all contracts will he subject to Spanish law. That is, even if the buyer’s contract states that its terms are subject to the laws of some distant offshore jurisdiction, where the timeshare company’s headquarters is located, this provision is not valid and the contract will be subject to interpretation in Spanish courts.
This has been a thorny point in many timeshare contracts because the buyers found it difficult to dispute any point when the court was thousands of miles away.
Even the service companies that maintain the resorts have, until now, often been registered in offshore tax havens. This made it difficult for timeshare buyers to bring action against the companies when they failed to keep the resorts in good condition.
Under terms of Spain’s new law, the service companies must have a permanent establishment registered inside Spain, where they can be held legally responsihle.
Furthermore, the new law makes the resort owner finally responsible for proper maintenance of the resort, and action can be taken against the resort owner if the service company fails to perform.
On the other hand, the resort operator can repossess an owner’s holiday weeks if the owner fails to pay one year’s maintenance charges. The operator must give 30 days certified notice before he can do this, and, unless this right is specifically renounced in your contract, he must pay back the owner the value of his remaining weeks in the scheme.
That is, a timeshare plan may run from a minimum of three years toa maximum of 50 years. If an owner has used his weeks for 25 years in a 50-year plan and then defaults, the operator must pay him hack half of his original price, as well as assuming the debt owed by the owner to the service company.
However, it is also possible for the timeshare contract to contain a penalty clause that Will let the company keep the entire amount originally paid. Watch out for this clause in your timeshare contract The law also provides that timeshare contracts can be registered in Spain’s Property Registry as a special right, although the law is also very careful to note that timeshare is not a property right as such, that it is a service contract not a property sale.
The full name of the law in fact is The Law Regulating the Rights of Rotational Enjoyment of Real Estate for Touristic Use, and it forbids any mention of property rights in timeshare publicity.
Unfortunately, the law does not mean that all timeshare sales are now regulated and controlled to protect the consumer. Timeshare companies have already come up with new schemes relating to “vacation plans” and “point systems” to move their products out of the area controlled by the law.
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