Preparation of the Council meeting Competitiveness (Internal Market, Industry and Research) on 22 and 23 November 2007 Proposal for a Directive of the European Parliament and of the Council on the protection of consumers in respect of certain aspects of timeshare, long-term holiday products, resale and exchange (LA) - Progress report - Exchange of views [Public deliberation, pursuant to Article 8(1)(c) CRP]

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Preparation of the Council meeting Competitiveness (Internal Market, Industry and Research) on 22 and 23 November 2007 Proposal for a Directive of the European Parliament and of the Council on the protection of consumers in respect of certain aspects of timeshare, longterm holiday products, resale and exchange (LA) - Progress report - Exchange of views [Public deliberation, pursuant to Article 8(1)(c) CRP]

Delegations will find in the Annex hereto the Presidency's progress report on the above subject.

The Permanent Representatives Committee is invited to submit it to the Council (Competitiveness)

for exchange of views.

_____________________

ANNEX

Proposal for a Directive of the European Parliament and of the Council on the protection of

consumers in respect of certain aspects of timeshare, long-term holiday products, resale and

exchange

Progress report submitted by the Presidency

I. INTRODUCTION

  • 1. 
    On 8 June 2007, the Commission submitted its proposal based on Article 95 of the Treaty

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(hereinafter referred to as the "Timeshare Directive") to the European Parliament and the Council. The proposal takes into account the Council Conclusions of 13 April 2000 on the

implementation of Directive 94/47/EC as well as the European Parliament's Resolution of 4

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July 2002 recommending that the Commission take action to resolve the problems of consumers of timeshare products, while guaranteeing them the highest level of protection.

  • 2. 
    Although the current Timeshare Directive (94/47/EC) is part of the comprehensive review of

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the Consumer Acquis comprising 8 directives , the Commission considered that it would be counter-productive to wait for the outcome of the Green Paper and its legislative follow-up

before reviewing the Directive. The revision of Directive 94/47/EC had become a priority

given the urgency of the problems faced by consumers, in particular in relation to resale and

new products such as timeshare-like products (e.g. holiday stays in movable rather than

immovable property, like boats or caravans) and long term holiday products (e.g. discount

holiday clubs).

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10686/07 [ref. COM/2007/303 final - COD 2007/0113] 2

OJ C 271 E, 12/11/2003, p. 0578-0582 3

Green paper on the review of the consumer acquis (doc. 6307/07, COM(2006)744 final).

  • 3. 
    On 28 June 2007, the Council decided to consult the Economic and Social Committee, which

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adopted its opinion on 24 October 2007 by 129 votes to three, with one abstention.

  • 4. 
    In July 2007, the European Parliament appointed Mr. Toine Manders (ALDE/NL) as the

rapporteur for this proposal. He is expected to present a draft report by the end of 2007 and the

European Parliament first reading opinion might be adopted in spring 2008.

II. WORK CONDUCTED WITHIN THE COUNCIL

  • 5. 
    The proposal has been discussed at seven meetings of the Working Party on Consumer

Protection and Information (10 and 20 July, 10 and 11 September, 5 and 16 October and 6

November 2007). The impact assessment underpinning the proposal was presented and

discussed at the first meeting on 10 July 2007. Overall, Member States showed a general

support for the Commission's proposal.

  • 6. 
    In the course of these meetings, the Presidency endorsed the broad aim to contribute to a high

level of consumer protection and presented successive compromise texts designed to improve

the clarity of the draft proposal, ensure its consistency with existing Community legislation

and reflect the positions of Member States. Taking into account comments of Member States

and the Commission, several modifications to the Commission's proposal have already been

introduced by the Presidency to the text of the proposal, in particular:

  • a) 
    more comprehensive wording on the purpose and scope of the directive, creating a link between the requirements of the internal market and the need for a high level of

consumer protection;

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Not yet published in the Official Journal.

  • b) 
    clarification of the relationship with the Unfair commercial Practices Directive (2005/29/EC);
  • c) 
    clarification of several definitions, and addition of the definition of a "durable medium" (e.g. CD-ROM, DVDs, hard drive of the consumer's computer) in line with existing

Community legislation;

  • d) 
    insertion of a new provision on promotion and sales events;
  • e) 
    clearer distinction between provisions concerning different stages before possible conclusion of the contract, i.e. advertising, promotion events and pre-contractual

information;

  • f) 
    possibility to provide pre-contractual information on the durable medium as well;
  • g) 
    modification of Annexes containing the list of pre-contractual information to be given to the consumer in a reasonable time before conclusion of the contract for products

covered by the draft Directive, i.e. timeshare, long-term holiday products, resale and

exchange of timeshare.

  • 7. 
    However, some outstanding issues remain open:
  • a) 
    Relation between the "Timeshare Directive" and the Review of the Consumer Acquis

Following its Green Paper and the public consultations that ended on 15 May 2007, the

Commission is expected to review the consumer acquis in a comprehensive way by

presenting, in the second half of 2008, a proposal for a Framework Directive on

Consumer Contractual Rights. In its proposal for the revision of the Timeshare

Directive the Commission decided to harmonise the vertical aspects of this Directive

and only a few horizontal aspects, such as the period for exercising the right of

withdrawal, while others have been left for the future Framework Directive (the starting

point for the right of withdrawal and the modalities and effects of exercising the right of

withdrawal). This approach raised concerns during the negotiations in the Council

Working Party.

With the aim of understanding which is the dominant perspective among delegations

and in view of finding a balanced solution for future work, the Presidency conducted a

survey, which showed that most delegations could agree to harmonise all the horizontal

aspects relating to this Directive. Delegations argued that this would be the better way

to boost confidence and enhance consumer protection, as it would create legal certainty

for both consumers and businesses. Therefore, the Presidency took the option to

consider harmonising the horizontal aspects relating to the modalities and effects of

exercising the right of withdrawal in the Timeshare Directive, which will involve

further work in the Council.

  • b) 
    Article 2 ­ Definitions

The definitions of timeshare contract, long-term holiday product contract, exchange

contract and ancillary contract need further clarification, more particularly regarding

their scope.

  • c) 
    Language regime for the provision on pre-contractual and contractual information The Presidency also raised the question of the language regime in its survey, and a large

number of delegations opted to preserve the language regime for pre-contractual and

contractual information contained in the current Timeshare Directive. Nevertheless, this

question will need further debate.

  • d) 
    Inclusion of a detachable form for the exercising the right of withdrawal Further to the survey conducted by the Presidency, a significant number of delegations

considered that a detachable form could be mandatory for operators to include in the

contract allowing consumers to use it when exercising their right of withdrawal.

  • e) 
    Relationship to the draft Rome I Regulation

The Presidency attempted to clarify the relationship of the draft Directive to the draft

Rome I Regulation on the law applicable to contractual obligations and suggested to

split the Article 8 into two Articles - one on the imperative nature of the Directive and

the other on the Community overriding mandatory nature of its provisions.

In this respect, and in order to facilitate the future discussions on the proposal, the Presidency

proposes the following question to be briefly addressed by Ministers:

Do you prefer the horizontal issues of modalities and effects of exercising the right of

withdrawal to be fully harmonised and regulated in this Directive or in the context of the future

framework proposal from the Commission concerning the review of the consumer acquis?

III. FURTHER STEPS

The Portuguese Presidency will hold one more meeting at Working Party level to continue

discussion on outstanding issues (based on doc. 15045/07) with the objective of concluding

on as many points as possible.

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