European Consumer Centre
The European Consumer Centre Ireland (ECC Ireland) was established as part of a European wide network to encourage consumer confidence within the EU. ECC Ireland advises citizens on their consumer rights while shopping in another European state. It aims to facilitate easy access to redress and if necessary, the EEC Network also offers a dispute resolution service. In such a case, EEC Ireland can mediate with a trader through the sister centre of the country of purchase. Please see the EEC Ireland website for contact details.
Clearly the Irish consumer has been let down by the sales process used by French leaseback promoters and developers, leaving many Irish consumers locked in to leases with conditions they were not given any knowledge on.
Indeed, the EU Charter of Fundamental Rights and the European treaties since the Single European Act state that they guarantee a high level of consumer protection in the EU. It is also a general objective defined in Article 12 of the Treaty on the Functioning of the EU.
This European legislation guarantees consumers:
- fair treatment;
- products which meet acceptable standards;
- a right of redress if something goes wrong.
EU legislation in other areas also has to take consumer protection into account.
Generally, consumer protection is ensured by a diverse set of policies, such as food and product safety or data protection.
Consumer and marketing legislation is aimed at protecting the economic interests of consumers. It mainly covers unfair commercial practices and consumer contract law, such as misleading advertising and unfair contract terms.
The reference to:
misleading advertising and unfair contract terms
is most applicable to many French leaseback investment property purchasers who were not informed of the nature of the commercial lease (bail commercial) that they were signing. Most thought it was a rental agreement contract. Most were not informed that the 9 year lease did not end after 9 years, contrary to what the lease states. Most were not informed that if the buyer did not renew it that compensation could be demanded.
Most were not informed that they would in fact be trapped in a consumer nightmare..
Contact the European Consumer Centre (Ireland) at:
European Consumer Centre Ireland
1 Green Street
Phone: 01- 8797620
European Directive on Timeshare
European Directive 94/47/EC was introduced in the mid-nineties to legislate on timeshare agreements. Over the years, a number of timeshare-like products appeared in the market to circumvent it. In order to close off the ability of certain traders to weaken consumer protection, the EU introduced new legislation – Directive 2008/122/EC on the protection of consumers in respect of certain aspects of timeshare, long-term holiday product, resale and exchange contract. This replaced the previous Directive and was transposed into Irish law by S.I. No. 73 of 2011.
DIRECTIVE 2008/122/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 14 January 2009 on the protection of consumers in respect of certain aspects of timeshare, long-term holiday product, resale and exchange contracts.
Annex 1, Part 3, Section 5 states the requirements on information relating to the termination of the contract. This is specifically missing in the sale of leasebacks.
It seems something similar to this EU Directive is required for French leaseback property..
The response from the European Consumer Centre of Ireland (ECC Ireland) is as follows:
ECC Ireland offers free information and advice to the public on their rights as consumers in the European Union, assisting them with cross-border complaints (where consumer and trader are based in a different EU/EEA state). ECC Ireland is part of a network of 30 centres across Europe working together to resolve cross-border consumer complaints in an amicable manner. Please note that our services are strictly out-of-court and we do not have any powers of enforcement.
With regard to your query, please note that ECC-Net do not generally deal with real estate issues, given the lack of EU-wide legislation in relation to immovable property and the expertise needed to examine complex transactions of this kind under the relevant law at national level. We are not aware of any alternative dispute resolution (ADR) entity entertaining this type of issue. In these cases we therefore recommend engaging the services of a qualified practitioner with the required expertise. Where the transaction involves certain financial products, there are instances where Fin-Net may also assist. Fin-Net is a network of out-of-court complaint schemes in the European Economic Area which handles disputes between consumers and financial service providers, i.e. banks, insurance companies, investment firms and others.
We consulted the European Consumer Centre in France and, other than the above, they have indicated that they are not aware of any specific legislative changes lately, other than minor amendments to the main law (Loi 84-595), e.g. ordonnances 2010-638, 2012-576 and 2013-544. Pursuant to the Finance Acts, however, a number of schemes providing for tax benefits and incentives have been introduced or suppressed in recent years (e.g. dispositifs Demessine, Scellier, Duflot, Pinel).
As regards the information provided, please appreciate that leaseback contracts (contrats de location – accession) establish a number of legal relations and legal consequences which require close examination by an expert eye in order to provide specialised legal advice. Please also appreciate that consumer law only covers transactions between a trader and a consumer, where the latter acts for purposes which are outside his trade, business or profession.
If leaseholders are reluctant to seek professional legal advice and/or take further action through the courts, all we could suggest in this instance is that they consider the possibility of setting up or joining a stakeholders group, such as the Fédération Nationale des Propriétaires de Résidences de Tourisme, http://www.fnaprt.com.
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