Warning about timeshare rip-off in the Canary Islands
Timeshare is the co-ownership of a holiday home or similar, which is available to the individual co-owners for fixed periods of the year. With this time-share type of use of a residential unit, mostly Central and Northern Europeans buy shares in holiday resorts operated by large providers in Mediterranean countries or holiday islands. Unfortunately, these investments in a carefree holiday period with the advertised "home feeling" regularly reveal all kinds of problems.
Situation on the Canaries
The Canary Islands, west of North Africa, an extraterritorial area of Spain, popular as a holiday paradise with mountains, beaches and breathtaking nature. The comparison "European Hawaii" is often used. ANFI was founded here in 1988 by the Norwegian entrepreneur Björn Lyng. The ANFI Group sees itself as the leading company in the European timeshare sector.
The holding company is made up of seven subcontractors and was until recently a joint venture between the two companies of the local Santana Cazorla brothers and the Norwegian Lyng family. Mainly on the southwest coast of Gran Canaria, they operate large upscale accommodation complexes with numerous ancillary facilities such as marinas, restaurants, a shopping centre, several golf courses, artificial sand beaches, jet ski rentals, bars, car rentals, child care, supermarkets and other leisure properties. In short, ANFI is the commercial top dog in the Canaries.
For years, in this lucrative location of Macronesia, the two leading business conglomerates fought each other through hostile takeovers of share majorities and somewhat less subtly in favour over purchase bonuses of undeveloped stretches of coastline from the local administration and sometimes even in open competition of sales agents on the street. In 2021, however, two of the subcontractors under the control of the Santana Cazorla Group became insolvent, and the share owner and former main competitor, the Lopesan hotel group, gained majority ownership. This back and forth in the ownership structure and the associated fears of bankruptcy in recent years have caused great uncertainty among consumers who had bought shares in ANFI holiday resorts. This is hardly surprising, as club members and timeshare users are not protected against the insolvency of provider companies.
Reports on the bankruptcies of Cazorla and on landmark court cases against ANFI, as well as the generally damaged reputation of timeshare due to dubious sales methods, prompted the new management to no longer call its offers "timeshare" but "holiday memberships". It seems that the methods of contracting in the timeshare industry, which have been criticised for years, have not changed much. Recently, a decline in German-speaking tourist flows has been observed in Gran Canaria, allegedly due to failures in infrastructure development. Under great competitive pressure, local sales agents are once again using unfair business practices as they did in the past:
Always the same trick
The ECC has received new complaints, which read like it has been reported again and again for two decades from various classic holiday destinations. On Gran Canaria and also Tenerife there are boars on the road. So-called OPCs (Outside Public Contact) are mostly young people who approach tourists in the streets of the holiday areas, often when they are waiting for a taxi ride. Playa de Ingles in particular is the place where OPCs are on the prowl and try to foist timeshare products to holidaymakers.
The local administration always tries to restrict such operations, usually rather half-heartedly, because the companies involved pay a lot of tax money into the municipal coffers. The OPC like to make the first contact with scratch-off tickets, there is always a ticket with a "daily prize". To get the prize, one should head to a nearby resort. The prize is, for example, a tablet, a smartwatch or a VIP night in a hotel with a free taxi ride there. Or an afternoon at the golf course, jet ski or amusement park with a cocktail in a cool bar at an ANFI resort afterwards. In a holiday mood and caught off guard, many agree. Trained German-speaking sales staff (e.g. from "ANFI Dreams") are waiting at the pick-up point and then guide you for almost two hours through a nearby resort. In the effort to have a "relaxed" conversation, they ask again and again whether they would like to spend their holidays here next year. Other people join in and rant about the advantages of timeshare in this very resort. Finally, they find themselves signing a contract for several thousand euros.
For a first accommodation reservation, an immediate deposit of around 900 to 1200 € is due. The total offer can look like this: 60m² flat with bedroom and Jacuzzi, living-dining area with inventory, bathroom, terrace with sea view, drinks included, for around 3000 euros in total. This two-week stay is to be used up within one and a half years. There's no time to think about it, you have to sign right away. The brokers often explain that after the first stay you can move up to a higher customer class. This would mean a luxury trip at a one-time discount price in the discount club. Or a voucher for a free holiday at ANFI is included in the contract.
Not such a great deal
After the contract has been sweetened with champagne, many people realise, especially if they have compared other travel offers on the web and discovered critical customer reviews, that the offer is not so amazing after all. Often they report a flop: The promised flats / hotels are not available at any time, because the vouchers or travel packages are valid for a limited full stop, usually only one and a half years, after which they expire. The accommodations also do not quite correspond to the quality of the showcase flats shown. Additional services always cost extra. All in all, the whole thing seems expensive, as all additional costs such as beach visits, sunbeds, flights and meals have to be added. Only the overnight stay is included. It is also reported that the claim that these facilities are exclusively available through timeshare is not true. If you look around, you can get the same category of accommodation directly and cheaper via travel platforms (e.g. booking.com). All in all, it is cheaper to go on holiday with a package tour with similar services.
For the down payment of many hundreds of euros, you don't get any services at all. The daily prize from the scratch card turns out to be a cheap no-name product from China. Those who like to play golf may have been motivated by the nearby ANFI golf course. But here, too, the complaint. "Everything is always fully booked, you have to book one year in advance, I would not have thought that a renowned golf course would take part in such a rip-off," reported one of the people concerned. The desired accommodation next to the golf course is never available. We are not surprised.
Good to know: In the case of long-term contracts for holiday products that are concluded for more than one year, payments are made in instalments. From the second instalment onwards, consumers:inside can, according to the Timeshare Directive, withdraw from a contract without sanction. To do so, they must notify the traders in writing of the termination of the contract within 14 calendar days of receiving a request for payment for a specific instalment.
For long-term timeshare products, where part of the facility is purchased (right in rem), the economic benefit of holiday rights is questionable. Compared to sequentially booked package holidays, an investment in the residential right itself and the unpredictable future operating and maintenance costs of the overall facility is a price risk and likely to be more expensive overall. Similarly, the advertised exchange markets for acquired residential rights are subject to criticism, as no suitable destinations can be found there during the high season. The resale of holiday rights is usually theoretically possible, but in practice it turns out to be extremely difficult.
In the case of short-term timeshare and similar products (law of obligations), questionable methods are too often used by luring potentially interested parties into the facilities. At sales events, they are psychologically pressured into signing a contract. The vouchers issued turn out not to be redeemable. In addition, the total costs are often more expensive compared to package tours, as only the bare accommodation is included. Apart from the hours of advertising efforts of the sales agents during the initiation, it can be assumed that the stay in the resort facilities is connected with future promotional events. This is an attempt to persuade consumers to switch to long-term products.
TCA (Timeshare Consumer Association) warnt (Okt.2020) vor ANFI Investoren Betrug
reisereporter.de warns (Nov.2022) of rip-offs on Canary Islands
merkur.de warns (Dec.2022) of rip-offs on Canary Islands
private-holiday.de warns (2013) of rip-offs on Canary Islands
Specialised law firm (Dec.2021) on court ruling in favour of bruised ANFI timeshare owners
TCA article (Sept.2021) on bankruptcy of AANFI sales companies
ECC Germany's comprehensive guide to TImesharing problems
Insolvency notice on Anfi (8.2021) of the German-language local radio station on the Canary Islands
timeshare-talk.info lists 39 court decisions against Anfi until 2017 (in Spanish)
Download (PDF) the Timeshare brochure of the ECC Germany
Your Europe Article from the EU Commission on consumer rights in timeshare