| Are you considering buying a Time Share in Spain? You should know the law and the rules first. From end of 1998, sale or ownership of timeshare is regulated by a Spanish law, with number 42, based on a directive from the European Parliament and Council from 1994. The law gives effective protection to buyers of use by turn of a tourist dwelling, and also to people who have already bought such a right of use. The law does not use the term 'timeshare', but instead the words "aprovechamiento por turno de bienes inmuebles", meaning use by turn of property. It prohibits the use of the word "multi-property" or any other combination of words containing the word property (article 8.1). Consequently, in the following information we shall use the expression "use by turn of property". What is property used by turn? 
First, all independent dwellings in an apartment block or property development where is established the system of use by turn, must be included in this system. However, in certain cases can be combined the system of use by turn and tourist letting, as long as the two systems are applied to separate dwellings. The minimum number of dwellings in one development to be used by turn, is set at 10.
The period of use can never be less than 7 days per year, and all turns within the same development must be of similar duration. It is prohibited to divide the right of use by a quota, like 1/50th part. The law applies to all divisions of use by turn for more than 3 years and up to a maximum of 50 years. It is binding for the owner of the property, a promoter of use in turn (meaning a sales organisation), or any other person that participates professionally in the transmission or commercialisation of use by turn of property. So, it is not possible for any sales agent to avoid completion of the stipulations in this law. In article 1.7 of the law it is said that any contract for use by turn of a property, for more than 3 years, not done in compliance with the law, is automatically null and void, and any money paid must be returned to the buyer, and he may demand damages. Also null and void are any articles in a contract whereby the buyer renounces on any rights granted him by the law, or that exonerates any person or company that is professionally involved from the responsibilities established (article 2). Constitution of use by turn The use by turn of property must be based on a registration in property register. The conditions for this are the following: a) A "declaración de obra nueva" (declaration of new work) before a notary, registered in the property register, or if the work is still not terminated, a "declaración de obra nueva en construcción" (declaration of new work in construction). b) Having obtained all necessary permits - for opening, first occupation, tourist activity and habitation certificate. If the building is not terminated, then it is sufficient to have the building permit and license for tourist activity, in accordance with the rules existing in each of the regions. c) The existence of a service contract with a company that complies with the requirements established by the regional authorities, unless the owner himself will manage the services. Such service companies may not be established in fiscal paradises and must at least have a branch office in Spain. d) Having taken out insurance policies necessary. If the property is sold without having been terminated, the owner must give a guarantee for the termination by a bank or insurance company, that ensures the repayment of all monies paid in case the construction is not terminated on the date given, in accordance with Law 57/1968. The promoter is not released from this guarantee until it has been entered into the property register with a notarial affidavit to the effect of the building being terminated. Declared in title deed 
Utilisation of a property by turn must be declared in the title deed of the property, done in front of a public notary and registered in the property register. The notary and property registrar will not execute or register such a deed unless the owner or his representative has complied with all requirements mentioned in this law. So the title deed, made by a notary and its registration, has also become the best defence for buyers of property for use by turn.
In the title deed (escritura) will be described the total development foreseen for use by turn, and whether it has been terminated or not. Moreover, each of the dwellings in the development will be mentioned, the duration of use and equipment in the dwelling. Also, the services included in the use, eventual statutes of management, and the registral, cadastral, urbanistic and tourist situation of the building, must all be described. The costs of the services and duration in years of the agreement for use should be mentioned as well. Any contract the owner has signed, with a service company, for insurance policies, and guarantee for termination, previously mentioned, must be added to the title deed. Any later changes in a service contract must be registered in the property register as well, and have the approval of the Community of Users. This type of decision may be taken by such a Community by a 2/3 majority of the users. Promotion and sale The owner, the promoter or any other person or company that in a professional way sells rights of use by turn of property must give all clients interested in buying such a period of use, a printed information containing the following: a) Name and address of owner, promoter or any other person or company that takes part in the commercialisation. b) The content of the right of use by turn, and the duration of this right, in accordance with the title deed for the promotion. c) If the property has not yet been terminated, the termination date. d) Description of the building where the system of use by turn has been established, and if the works are terminated or not. e) The services the client will be offered, and the conditions for their use. f) Installations for common use the client may have access to, with conditions and prices for using them. g) Name and inscription in the Mercantile Register of service company. h) Medium and maximum prices for the purchase of right of use by turn. The amount to be paid for the use of communal installations and services for the first year. i) Number of units of dwellings to be used with this system, and the number of turns. j) Information on the right of withdrawal and unilateral cancellation of the contract by purchaser without any costs on his part. If the dwelling is under construction, an indication of the termination guarantee. k) If the purchase gives the possibility of taking part in a system of exchange of use by turn, how this system works and costs involved. All information must indicate the dates of inscription of the promotion in the property register, ownership and eventual charges or liabilities. The contract The law describes in article 9 the minimum content of a contract for sale of use by turn of a property. Here are the basic requirements: 1) Date of the contract and the information on the development from the property register. 2) Description of the right to be sold and how long it will last. 3) Description of the building and the dwelling to be used, with their registration dates from the property register. 4) Whether the dwelling has been terminated or not. If not terminated it must state at what stage of termination it is at the moment, reference given to building license from municipality, the stage of termination of common services, building description, list of furniture and equipment included and their value, and explicit reference to the guarantee of termination with a date for finishing the work. 5) The price for the right of use, taxes and the yearly costs. 6) The literal text of articles 10, 11 and 12 of law (see chapter on Right of Withdrawal). 7) Common services and installations the buyer has the right to use, and eventual conditions for this use. More requirements 8) If possibilities exist of taking part in an exchange system and the costs involved. 9) Name and address of vendor and eventual inscription numbers in Mercantile Register. If someone other than the owner sells, his legal relation with the owner must be indicated. Also, the eventual service company other than the owner must be mentioned. 10) Duration of the right of use. 11) Explanation of the rights of the buyer to check the title deed, giving name, address and fax number of property register; the right to demand a title deed in the name of buyer and having this inscribed in the property register. 12) Place of signing and signatures. The inventory for the dwelling to be used and the general conditions not included in the contract, as well as the statutes of management, must be added to the contract as inseparable part signed by both parts. The contract and additional documents must be written in Castellano or one of the other official languages in Spain, as well as one of the languages from a country in the European Union where the buyer resides. Buyers residing outside the European Union may choose one of the official languages in the Union. Right of withdrawal In articles 10, 11 and 12 of the law are contained some very important defences for the buyers. Article 10 gives him the possibility to withdraw from a purchase contract of use by turn of a property within 10 days of having signed it. If the last of the 10 days is not a working day, it will not be counted. Buyer will not have to pay any damages or costs for using this right of withdrawal. If the contract does not contain all the minimum requirements mentioned above, or if any other stipulation in the law has not been complied with or the information document does not correspond with what is registered in the property register, the buyer has 3 months to withdraw from the contract signed, without being asked to pay any damages or costs. Such a withdrawal must be notified to the owner or sales organisation in a way that guarantees reception, giving proof of the cancellation date. If the contract was made in an escritura (title deed) in front of a notary, the withdrawal must be done through a notary too. Article 11 prohibits any down payments to the vendor, until the 10 days withdrawal period has elapsed. Vendor and buyer may agree certain payment forms, but they must not contravene the stipulations of the law. If the client has paid some amount before the end of the withdrawal period, he has the right to demand the double amount be returned if withdrawing. Any agreements on financing granted to the buyer are automatically cancelled when he uses his legal right of withdrawal, without any costs or fines. On the other hand, the owner has the right to cancel the contract if the buyer has not paid service charges for at least 1 year, returning to the client an amount equivalent to the value of the remainder of the years of use. However, a penal clause may be agreed in the contract, whereby the client lose all or part of his rights when not paying the charges agreed. The owner of the property 'used by turn' is responsible for the good functioning of any service company that has taken over the management. Any changes in agreements between owner and service company may not damage the clients rights. Notary and property register 
Purchase and transmission of rights of use by turn of property may be elevated to a public title deed executed in front of a notary, and registered in the property register. But such a public deed and registration is no obligation (same as for buying a property), but gives the buyer a much needed additional security.
The owner of a right of use by turn may freely dispose of his right, without any other limitations than those mentioned in the law. An owner of a right that is professionally involved in the marketing of such rights, however, is subject to the stipulations in this law. The constitutional escritura for the promotion of use by turn must foresee a Community of Users. This community is governed by the statutes mentioned in the title deed, or such that the users agree on. Decisions in such a community can be taken in this way: 1) Changes in the management system installed require a 2/3 majority of owners. 2) For any other decisions a simple majority of the owners is sufficient. 3) There is 1 vote for each right of use by turn. 4) If a majority cannot be reached, or if some owners feel seriously prejudiced by a decision, the courts will decide. 5) Subsequently, the norms of the Ley de Propiedad Horizontal (Law on Communities) will be used. Taxes There are taxes to be paid on a right of use by turn. On a sale by someone who professionaly markets rights of use by turn, will be charged 7% IVA (VAT), but with a reduced rate for properties situated on the Canary islands. If a private person sells his right of use, the ITP (Impuesto de Transmisiónes Patrimoniales) is 4%. The tax value for the Wealth Tax (Patrimonio) is the purchasing price. Any promotions existing before this law came into effect, must be adapted to its requirements, over a time period of 2 years. The law contains norms for this adaption, that should be carefully studied by all time-share companies, to avoid new buyers in such promotions using their right to cancel contracts signed after this law took effect, demanding the return of all money paid, together with damages. | 
