The MP also submitted a draft ordinance that would realize the establishment of the St. Maarten Timeshare Authority SXMTA (see related story).

 

This revision in the timeshare legislation provisions of the civil code is written in English, as allowed by the constitution of St. Maarten.

 

With significant input from Professor Jan de Boer and other experts and timeshare stakeholders, the "bottom line" intent of the law is to establish consumer protection where a long-term relationship is developed with the consumer. In other words, to establish protection applicable to a consumer's long-term relationship with a commercial entity that has control of the accommodations which are part of a timeshare property.

 

The in-depth piece of legislation includes in detail, but is not limited to, the developer's obligations, the contract between parties, roles of the managing entity, focus on the termination or suspension of the rights of a user of a timeshare licence, advertising and sales, timeshare resale and so on.

 

History

In his motivations to the draft ordinance, De Weever recalled the parliament meeting of June 30, 2011, when he presented a motion concerning the need to improve existing timeshare consumer protection legislation and to create a regulatory body to monitor the timeshare industry. This motion was unanimously passed.

 

Pursuant to this motion, parliament requested the services of Professor Jan de Boer for the preparation of proposed changes to the civil code in line with the concerns of parliament addressed in the motion, with instructions to consult industry stakeholders in the process of preparation of such proposed changes.

 

It is explained that upon Professor de Boer's consultation with the St. Maarten Timeshare Association SMTA in July 2011, the former requested a draft of such proposed changes from the association.

 

In August 2011, the SMTA convened an all-members meeting to discuss Professor de Boer's request. The American Resort Development Association Caribbean Committee (ARDA Caribbean) was invited and participated in said meeting. SMTA proposed to establish a committee of international experts on timeshare legislation.

 

An ARDA Caribbean-SMTA Legislative Committee was created, including corporate counsel of international exchange companies RCI and Interval International, SMTA stakeholders and legal experts from the membership of ARDA Caribbean with vast experience in representing government regulatory agencies, timeshare consumers and the timeshare industry.

 

The ARDA Caribbean/SMTA Legislative Committee convened on September 9, 2011, and established the objective of bringing the St. Maarten revised timeshare legislation in line with current standards prevalent in the United States and Europe. The committee prepared an agenda, organized subcommittees, produced drafts of the proposed revised timeshare legislation and discussed such committee drafts in regularly scheduled weekly teleconferences.

Regular updates and consultations were presented to Professor de Boer throughout the process. Following Professor de Boer's initial review of the proposed timeshare legislation submitted by the Committee, a meeting of Professor de Boer and committee representatives was held in St. Maarten in early May 2012.

 

Objective

"The primary objective is to elevate the levels of consumer protection of the various contractual rights that are provided by the timeshare industry in St. Maarten. Timeshare concepts initially evolved from the selling of specific weekly ownership in a specific holiday home or apartment, to a more flexible right of usage of annual, bi-annual or even quadric-annual weekly use of non-specific accommodations at a timeshare property to an increasingly popular right of usage that can be broken down into nightly usage on a recurring basis," the motivation for the amendments reads.

 

In that context, it is explained that the terms "vacation ownership" and "vacation points" are often used to describe this more flexible product. Most commonly, these plans utilize a "currency" denominated in points. In a points-based system, a purchaser may acquire a seven-day use period in mid-range time, which is equal to e.g. 1,000 points. These points can be used in a variety of ways. For example, rather than utilizing all 1,000 points or a seven-continuous-day stay in a one bedroom unit, the purchaser may instead choose to divide his stay into a three-day period and a later four-day period, or may choose to upgrade to a two bedroom unit for a five-day period.

 

"This leads us to the necessity of updating the definition of timeshare rights. While consumers have welcomed this increasing flexibility, regulations based upon rigid systems of weekly ownership cannot keep pace with the evolving timeshare market," De Weever notes.

 

Also addressed is the timeshare product commonly called a "fractional" or "private residence club." This product is usually sold in increments of several weeks, ranging from four to six weeks or more, depending upon the particular plan. This type of product is usually marketed to much higher income customers than traditional timesharing. The product usually has substantially more amenities and is substantially more expensive.

 

"While traditional timesharing differs from fractional products in the amenities package provided and the cost and the demographics of the buyers, from a legal standpoint all jurisdictions, at least in the US and EU, regulates the product in the same manner. Both are usually covered under statutes designed for timesharing and should be so treated in St. Maarten," it is explained.

 

Broad

The scope of the legislation is described as "purposefully broad" with the intention that it will be flexible enough to address the continuing evolution of the timeshare model and the types of accommodations to which the model may be applied. However, while the purpose is to offer consumer protection, it is not the intention to regulate other relationships in which a group of persons decides, collectively, to purchase accommodations and then determine how to divide the use of such an asset among themselves.

 

(The Daily Herald)