Timesharing

Timesharing

With time-sharing, real estate is purchased to reside in for a specific period each year. In many cases, this involves a holiday home. While staying in the property, the occupant also becomes the owner of the real estate. The time purchased for residence is subsequently exchanged with other owners of the property. An owner often does not have to perform maintenance themselves. However, time-sharing does entail a number of risks. In addition to the purchase price, there are annual costs that must be paid for maintenance, management, insurance, etc. Furthermore, one might end up being sold a lemon. Because the real estate is often located in another country, foreign law may apply. Our lawyers and legal experts can provide legal support regarding time-sharing.

Questions about time-sharing? Please contact us.

What exactly is timesharing from a legal perspective?

Timesharing – referred to in the law as “part-time use” – is an agreement with a term of more than one year whereby the consumer acquires, in exchange for payment, the right to use accommodation for multiple stays. This is regulated in Articles 7:50a through 7:50i of the Dutch Civil Code (Title 1A of Book 7 of the Civil Code), which implement the European Timeshare Directive 2008/122/EC. In addition to classic timeshare, this regulation also covers long-term holiday products (such as holiday discount clubs), resale agreements, and exchange agreements. The legal form strongly determines your position: whether you are an international real estate group or the baker on the corner buying a single week of vacation, it pays to have an assessment made in advance of what you are actually acquiring.

Property law versus obligatory timeshare

From the perspective of real estate, the crucial distinction is between a proprietary (real) and an obligatory (personal) timeshare. With a proprietary structure, you acquire a right to the property itself, for example, a share in co-ownership (community, Article 3:166 of the Dutch Civil Code), an apartment right , or a limited right such as leasehold or usufruct. With an obligatory structure – such as a long-term tenancy right or a right of use through membership of a cooperative – you have only a claim against the provider. This difference is decisive in the event of the provider's bankruptcy: a holder of a purely obligatory right is, in principle, no more than a concurrent creditor, whereas a holder of a real right can assert their right against third parties. The Supreme Court has classified some timeshares as long-term leases, so that the rule "sale does not break lease" (Article 7:226 of the Dutch Civil Code) can offer protection. We assess which structure has been sold to you and what risks are associated with it.

Cooling-off period, right of withdrawal and the prohibition of prepayment

The law provides strong protection for the consumer-buyer. You have a cooling-off period of 14 calendar days during which you can withdraw from the agreement without giving reasons and without incurring any costs (Article 7:50d of the Dutch Civil Code). If the mandatory standard withdrawal form is missing, this period extends to a maximum of one year; if the mandatory pre-contractual information is missing, a further maximum of three months is added. Furthermore, during the cooling-off period, there is a prohibition on advance payments: the provider may not request a down payment, deposit, or other payment (Article 7:50f of the Dutch Civil Code). If payment is made nonetheless, such payment is considered to have been made unduly. The provider must provide the information and the agreement in writing and in a language of your choice (Articles 7:50b and 7:50c of the Dutch Civil Code). These provisions are mandatory law (Article 7:50i of the Dutch Civil Code): they cannot be deviated from to your detriment.

Foreign law and international aspects

Because real estate is often located abroad – Spain, the Canary Islands, Aruba – foreign law frequently applies to the ownership or usage structure, while European consumer protection has been implemented within the EU by all member states. For the baker on the corner as well as for the international group, it is important to determine in advance which law and which court have jurisdiction, whether a property registration has been carried out abroad, and whether the agreement complies with local formalities. We work in mixed teams of lawyers and in-house counsel and engage with foreign specialists where necessary, ensuring your position remains clear across borders as well.

Terminate timeshare agreement or resolve dispute

Many clients come to us because they wish to terminate an ongoing timeshare or believe they have bought a “pig in a poke.” Depending on the situation, there are several routes: revocation within the (extended) cooling-off period, termination – penalty-free from the second term for holiday discount clubs – or annulment due to deception or error. Exchange agreements linked to a timeshare terminate automatically and free of charge along with it. If there is a breach of contract or a defective legal position, dissolution of the purchase agreement be appropriate. Our lawyers and legal experts review your contract, put the provider in default if necessary, and litigate where required.

What our lawyers and legal experts do for you

MKB Juristen works with mixed teams of lawyers and in-house counsel, serving large corporations as well as individual entrepreneurs and consumers. We review timeshare contracts before signing, verify the chosen legal structure and pre-contractual information, advise on revocation, cancellation, and termination, and assist you in disputes with providers – in the Netherlands and, through our network, abroad. Questions about timesharing? Feel free to contact us without obligation.