Background

Summary of Council decision:

Three issues were investigated, all of which were Upheld.

Ad description

An email for Timeshare Relief UK, a timeshare relinquishment company, received on 30 June 2015, stated "10th ANNIVERSARY NEWS SPECIAL. FINALLY - A BREAK FOR TIMESHARE VICTIMS. New Rules aim to end decades of pressure-selling and release thousands of people from costly and unfair contracts. Thousands of Britons trapped in onerous timeshare or ‘holiday club’ arrangements ... could be given an escape route as their contracts are effectively ‘null and void’ ... Soon to be implemented Europe-wide rules are expected to back the decision ... What has changed? A Norwegian woman was awarded more than £28,000 by the Spanish Supreme Court in March, giving fresh hope to Britons locked in similar arrangements". Further text stated "Jeffery Warren owner of the UK's leading Timeshare disposal company ... Mr Warren and his legal partners ... have saved their clients over £40,000,000 million pounds [sic] in fees ...".

Issue

KwikChex Ltd, as part of the Timeshare Task Force initiative, challenged whether the following claims were misleading and could be substantiated:

1. "the UK's leading Timeshare disposal company"; and

2. Mr Warren and his ... partners ... have saved their clients over £40,000,000 million pounds [sic] in fees ...".

3. KwikChex also challenged whether the claims "New Rules aim to end decades of pressure-selling and release thousands of people from costly and unfair contracts", "Soon to be implemented Europe-wide rules are expected to back the decision" and "A Norwegian woman was awarded more than £28,000 by the Spanish Supreme Court in March, giving fresh hope to Britons locked in similar arrangements" were misleading because they understood the decision applied only in Spain.

Response

Timeshare Relief UK provided a response by telephone.

1. Timeshare Relief said the claim was based on their experience within the industry. They said they had many positive testimonials about their business and many customers were satisfied with them. They added they advertised extensively and that they had obtained custom from clients who were dissatisfied with the timeshare relinquishment company they had originally instructed.

2. Timeshare Relief explained that timeshare property owners or holiday club members were liable for management fees, which paid for the maintenance and upkeep of the facilities of the resort in which their property was located. They said the majority of timeshare properties were bought in perpetuity which they said meant the obligation to pay the management fees was passed down to the owner’s family upon the owner’s death.

Timeshare Relief said the claim was calculated on the basis that the average contract for a timeshare property was 50 years. With an example cost of £1,000 a year in management fees, they said they would save that owner £50,000. With that in mind, they said if they had helped 1,000 people in the last ten years save £50,000, it amounted to saving their having said those 1,000 people £50m in fees collectively.

3. Timeshare Relief said it was their understanding that the ruling in the Spanish court would apply to all timeshare properties or holiday clubs memberships for resorts located in Spain. They said that would be the case regardless of the timeshare owner's nationality and therefore, they believed it was correct to say that the ruling could give hope to British owners with properties in Spain. They added that in their experience, rulings issued in one European country tended to be followed at some point by other European countries.

Assessment

1. Upheld

The ASA considered consumers were likely to interpret a “leading” claim in this particular ad as one relating to the share of the UK timeshare relinquishment market held by Timeshare Relief, and that it held a larger share than any of its competitors. We considered such a claim should be supported by documentary evidence comparing the market share held by all UK companies offering timeshare relinquishment.

We understood the claim was based on the collective experience of the business partners of Timeshare Relief UK. However, we considered that in itself that was insufficient to support a “leading” claim about their share of their industry’s market. Because we had not seen documentary evidence to support that type of comparative claim, we concluded the claim had not been substantiated and was misleading.

On this point, the claim breached CAP Code (Edition 12) rules  3.1 3.1 Marketing communications must not materially mislead or be likely to do so.  (Misleading advertising),  3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation.  (Substantiation) and  3.33 3.33 Marketing communications that include a comparison with an identifiable competitor must not mislead, or be likely to mislead, the consumer about either the advertised product or the competing product.  (Comparisons with identifiable competitors).

2. Upheld

We acknowledged Timeshare Relief’s explanation of how the claim was calculated but considered, nevertheless, that they had made an objective claim that was capable of substantiation. We had not seen evidence to support their belief that: the average contract for a timeshare property was 50 years; that fees for properties which they had helped to relinquish had a typical annual service charge of £1,000 and we had not seen evidence of the number of clients that Timeshare Relief had helped over the last ten years. Without seeing documentary evidence in support of their claim they “…had saved their clients over £40,000,000 million pounds [sic] in fees …”, we concluded it had not been substantiated and was misleading.

On this point, the claim breached CAP Code (Edition 12) rules  3.1 3.1 Marketing communications must not materially mislead or be likely to do so.  (Misleading advertising) and  3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation.  (Substantiation).

3. Upheld

We understood that the claims were based on Timeshare Relief's experience of the industry and that they believed decisions made in one European court tended to be followed by others at a later date. We noted their view that the Spanish decision applied to timeshare/holiday club properties based in Spain, regardless of the owner's nationality. However, we considered that the claims were likely to be regarded as meaning that there had been a decision in Spain, that this decision has led to new rules that were to be implemented imminently and that they would be of benefit to Britons. We considered that they would be regarded as being statements of fact, rather than opinion and, as such, we expected Timeshare Relief to hold substantiation in support of each of them. Because we had not seen any such evidence, we concluded the claims had not been substantiated and were misleading.

On this point, these claims breached CAP Code (Edition 12) rules  3.1 3.1 Marketing communications must not materially mislead or be likely to do so.  (Misleading advertising) and  3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation.  (Substantiation).

Action

The ad must not appear again in its current form. We told Timeshare Relief UK to remove the following claims: “the UK's leading Timeshare disposal company”; “Mr Warren and his ... partners ... have saved their clients over £40,000,000 million pounds [sic] in fees”; "New Rules aim to end decades of pressure-selling and release thousands of people from costly and unfair contracts"; "Soon to be implemented Europe-wide rules are expected to back the decision"; and "A Norwegian woman was awarded more than £28,000 by the Spanish Supreme Court in March, giving fresh hope to Britons locked in similar arrangements".

CAP Code (Edition 12)

3.1     3.33     3.35     3.7    


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