European Diary:Dubliners Thomas and Margaret thought their luck was in during a trip to the Canaries when they met a young man handing out scratchcards. When they got three stars, he told them they had won a prize. All they had to do was come to his firm to pick it up.
It couldn't be any easier, could it? A few hours later and they were recovering from the hard sell given by two holiday club agents, who persuaded them to pay out €1,100 for holiday vouchers, which they thought were fully refundable.
"It turned out the firm had signed us up for trial membership of the club and later demanded extra money. When we tried to get a refund, they told us there was no cooling-off period on the contract and we couldn't get it back," says Thomas.
"The first guy got real friendly with you, while the second person started to be really forceful . . . Every time one of the other 'lucky' couples getting the hard sell signed a contract, champagne corks popped. When they get you in, they really work on you."
Thomas is one of 44 people who lodged complaints with the European Consumer Centre last year about these types of holiday clubs and other traditional timeshare operators. In Europe there were 2,256 complaints in total, with Germany (577), Britain (341) and Belgium (297) scoring highest for holiday rip-off scams.
Tomorrow Brussels plans to come to the rescue of people like Thomas and Margaret, when consumer commissioner Meglena Kuneva will propose revising the 1994 timeshare directive. This legislation sets rules such as precontractual information, contractual terms and cooling-off periods for timeshares.
Over the years, cunning traders have exploited loopholes to bypass regulations, prompting this tightening of the legislation.
"Under the existing legislation, the definition of a timeshare does not include boats such as cruise ships and canal boats, it only applies to contracts of over three years, and it does not apply to holiday clubs that offer special offers on holidays," says Sandy Grey, director of the Timeshare Consumers' Association in Britain.
This means consumers purchasing these products are not covered by safeguards in the 1994 timeshare directive, such as a 10-day cooling-off period that enables consumers to cancel contracts bought on a whim.
This is particularly true of holiday club scams, which are growing fast as rogue traders who previously operated in the timeshare business avoid the 1994 regulation by setting up clubs. Described as "long-term holiday products" in the trade, these clubs encourage consumers to buy the right to obtain discounts on future holidays.
"These products often look like they offer great flexibility to the purchaser, but in reality the club often doesn't deliver on its promises," says Nuria Rodriguez of the European Consumers' Organisation (BEUC).
"Consumers can pay as much to enter these clubs as it costs to buy a timeshare property in its own right."
The holiday club agents use the same high-pressure sales tactics that they learnt in the timeshare business before 1994: free drinks, glossy brochures and lengthy sales presentations are all tools of the trade. Once they get a consumer's signature on a contract, it can be hard to escape from making a payment.
Kuneva's new directive would offer consumers more protection against unscrupulous traders. For example, it places an outright ban on timeshares and holiday clubs taking deposits from consumers before a cooling-off period ends. Under the 1994 directive, some states banned deposits for timeshare firms, but others, such as Spain, allowed deposits to be paid to third parties, such as banks or dubious overseas trusts.
Removing deposits at point of sale should, in theory, prevent many holidaymakers from losing cash paid upfront for products they don't really want. The directive also extends the cooling-off period from 10 to 14 days - which should become standard throughout the 27 member states - and toughens up restrictions on advertising for the products.
The timeshare industry is furious about the proposed new directive and is warning it could strangle an industry worth several billion euro a year in the EU. It has argued that over-regulation could also costs jobs in big firms such as RCI, which employs 1,000 people in Cork.
"The industry sold 80,000 timeshare contracts in Europe last year and seven million people stayed at our timeshare resorts," says Peter van der Mark, secretary general of the Organisation for Timeshare in Europe (OTE), a trade body. "But there were just 118 complaints about timeshares in the first half of 2006 [ most of the consumer complaints relate to the holiday club firms springing up in the EU]."
Van der Mark says the directive is badly thought through and unnecessary. Many of the scams are already covered by laws, but national authorities are slow to investigate and crack down on rogues, he says.
The OTE has lobbied industry commissioner Günter Verheugen and internal market commissioner Charlie McCreevy to try to get the draft directive watered down at tomorrow's meeting of the European Commission.
But with the commission's focus on popularising the EU with the public ahead of future referendums on a new EU treaty, it seems unlikely that the timeshare industry will get its way. That is good news for people like Thomas and Margaret who, with the help of the European Consumer Centre in Dublin, recently got a refund from the holiday club in the Canaries.