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Friday May 19, 2017

Public inquiry into timeshare schemes

The National Consumer Commission yesterday launched a public inquiry into the timeshare industry following thousands of consumer complaints against holiday clubs and other industry stakeholders over the past two decades.

National Consumer Commissioner Ebrahim Mohamed said his office held the view that complaints were "valid and warranted" based on its assessment of thousands of complaints lodged against holiday clubs and other stakeholders over almost two decades, dating back to the former Office of Consumer Protection in the Department of Trade and Industry.

Ebrahim said consumers had levelled a myriad serious allegations which flew in the face of the Consumer Protection Act against the industry.

"Consumers allege, amongst (sic) others, that they have been misled into signing up for lifetime contracts that can never, ever be cancelled.

"They also allege that companies overbook and oversell accommodation and timeshare companies threaten litigation if they cannot afford to pay levies for properties, which they never get to stay in because the properties are always fully booked," Ebrahim said.

"The most disturbing aspect is that the vacation ownership industry has done little or nothing to correct itself, which is naturally what every industry should be doing when issues are raised with its role-players' conduct, products or services."

Ebrahim said it was "disgusting" that captains of industry could "turn a blind eye" to the suffering of consumers for such a long time.

He said the purpose of the inquiry panel - comprised of attorneys Diane Terblanche, Zandile Mpungose and Aubrey Ngcobo - was to identify the root causes and make recommendations.

The panel was tasked with establishing characteristics of vacation ownership, timeshare and similar products and services, and their promotion in the country; who the service or product providers are and their inter-relationships; to assess pre-contractual disclosures and review agreements.

The panel will engage consumers, industry stakeholders, regulators, academics, courts and tribunals across the country over six months.

Vacation Ownership Association of Southern Africa (Voasa) spokesperson Alex Bosch said the industry was dismayed at the commissioner's claim that industry captains had turned a blind eye to consumers. He said the industry offered "full support" to the inquiry and had met with the NCC to discuss its participation.

"In 2008, Voasa representatives met with the NCC, then called the Unfair Business Practices Committee, on numerous occasions to propose amendments to legislation to assist consumers.

"However, despite these meetings and proposals, no progress was made to amend the legislation. In 2014 Voasa cautioned the NCC that the investigation into three major holiday clubs was being handled incorrectly and would ultimately lead to a waste of the consumers' time and taxpayers' money," he said.

He said the industry had submitted an amended Code of Conduct for the industry to the NCC but it had not acknowledged or commented.

"We believe every effort has been made by Voasa and its industry captains to remedying (sic) any challenges faced by consumers and the vacation ownership industry. We are optimistic that the inquiry will provide a positive platform to assist consumers and provide a better understanding of the vacation ownership industry," said Bosch.

SA National Consumer Union chairperson Ina Wilkin said the union supported the inquiry which was "long overdue" as many problems had persisted in spite of industry efforts to self-regulate and support the Consumer Goods and Services Ombudsman.

The Mercury

 
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