If you are a holiday home owner hoping for change to this industry, then start by reading the below letter, then emailing a copy to the email addresses provided at the end.
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You can download a copy of the letter by clicking here
Dr Andrea Coscellie CBE
Competition and Markets Authority
The Cabot
25 Cabot Square
London
E14 4QZ
United Kingdom
Holiday Home and Holiday Park Industry Complaint
Dear Dr Coscellie
We write to you to complain about the anti competitive ‘Industry Standards’ that have become endemic throughout the Holiday Home and Holiday Park business sector.
Not only do these standards frustrate competition in core aspects of their business, but the unique nature of the business also prevents consumers accessing the protections afforded to them under the Consumer Rights Act 2015.
Thanks to Martin Lewis (moneysavingexpert.com) and Dean Durham (theconsumerlawyer.com) your attention has been drawn to the ‘pitch fee’ refund issue, which represents a very small tip of a large iceberg when it comes to the daunting issues faced by consumers (holiday home owners).
The 2005 examination of business, by the Office of Fair Trading and the trades associations, NCC and BH&HPA, resulted in the OFT (734) Guidance on unfair terms in holiday caravan agreements. That guidance has not had the desired impact of improving consumer protection. On the contrary, the evidence from many 1,000’s of holiday home owners, point to a significant reduction in consumer protection as a direct result of the imbalance of power created in the terms of site licence agreements.
The withdrawal of that guidance and subsequent enactment of the Consumer Rights Act 2015 has removed the focus from the specific issues associated with this unique industry.
The NCC and BH&HPA recommend models of agreements to their members and it is clear that the terms are written first and foremost to protect the interest of their members. They create an imbalance of power between business and consumer, and as a result enable businesses to use their sole discretion on the interpretation and application of the terms. They often include terms that confuse consumers and frustrate competition for services within the contract.
There is now disturbing evidence emerging of companies including terms in the agreements, which deny consumers the right to comment on social media regarding their experience and other aspects of ownership of holiday homes. This is not conducive with an open and competitive market and denies the fundamental rights of consumers to a freedom of speech.
Due to the value of the goods and services involved and unique nature of the business, consumers can very rarely access the protections offered to them under the Consumer Rights Act 2015. Holiday Homes cost many tens of thousands of pounds and as such consumers would need to access the High Courts to challenge simple consumer protection breaches.
This can be demonstrated by the 3 specific cases progressing to High Court action, referred to by various owners action groups including the Facebook group ‘Park Holidays & Other Parks Unhappy Caravan Owners/Users Action Group’. This group with 11,000 members and a Govt. Petition of over 12,000 signatures so far, administered by owners rights champion Carole Keeble, is just one of many such groups. This gives a clear representation of the many consumer protection failures in this industry.
The vast majority of consumers simply cannot afford such access to legal protection and as such are at the complete mercy of the business to which they are contracted.
For example the termination of a site licence agreement is made on the sole basis of how the business chooses to interpret the circumstances at the time. This clearly gives the business a dominant position in the contract but for an expectation of ‘good will’ in contract law, dubious at the best of times. The only redress for consumers is injunction followed by High Court action, which, in almost all circumstances, is prohibitively expensive.
What flows from this ‘threat’ and dominant position within the contract is the ability of business to circumvent rules and other consumer protections.
Using Gas Servicing and Testing as one example of a term often contained in site licence agreements.
Gas testing is required on an annual basis within the contracts, but for private owners of holiday homes, without subletting, this is not a legal requirement under general law.
The businesses processes, actions and wording in contracts give the clear impression that consumers must use the gas engineer contracted by the business. There is evidence of over charging by the businesses of up to 500% as measured against what it would cost the consumer to pay for the service direct to the gas engineer.
The same anti competitive practices apply to the purchase and installation of decking, costing the consumer many thousands of pounds more than if they were able to go direct to the suppliers.
A close examination of the ‘Industry Standards’ across all aspects of the core terms of the contracts reveal systemic anti competitive practices, which if challenged by the consumer can lead to threats to terminate, or termination of, site licence agreements.
We suggest that the main reason why the CMA, Trading Standards, Citizens Advice or other regulators do not, ordinarily, see many thousands of consumer complaints, is because the industry can and does suppress them as a direct result of their dominant position within the contracts and their financial muscle.
The BH&HPA have issued their ‘legal opinion’ in relation to the issues thrown up by Covid-19. This opinion has been copy and pasted by many large companies and used to protect their businesses against any legitimate claims from consumers.
Trade Associations often have a dispute process, however, as shown following the successful use of the NCC process by Denise Godfrey against Park Holidays UK, the company attempted to settle the matter by restricting Ms Godfrey’s ability to discuss the case more widely. This would have restricted vital information being available to other consumers with similar claims.
Consumer champion Carole Keeble presented a substantial amount of evidence regarding a significant and sustained amount of mis-selling by Park Holidays UK to the Director General of NCC. To avoid scrutiny the company simply left that trade association and continued as members of the BH&HPA.
What is more fundamentally concerning and which demonstrates an unhealthy consumer environment, is the fact the BH&HPA withdrew its Code of Practice For Selling And Siting Holiday Caravans and there appears no formal recognised process for consumers to resolve disputes through them.
This industry is unique, in that consumers can spend tens of thousands of pounds, with limited protections due to prohibitive costs. The risk to consumers is far greater than for any other consumer purchase or service yet they cannot access even a basic level of consumer protection.
The Covid-19 Pandemic has shone a light on one small aspect of the industry. We urge the CMA to move that light around, as it will uncover, in the shadows, substantial consumer exploitation and restrictive competition practices.
Increased consumer demand for holiday homes on holiday parks, as a side effect to the global pandemic, may add a significant boost to the UK economy. However it will also expose many more consumers to significant risk.
We need an Industry Ombudsman to improve the protection afforded to consumers, so that the UK as a whole can benefit from what should be the Great British Holiday.
We will be happy to supply evidence to support our complaint.
Yours sincerely
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Send to both emails addresses for Lord Tyrie and also Cc copy to all the email address listed below.
Lord Andrew Tyrie Chairman of the Competition and Markets Authority using both of the following email addresses
tyriea@parliament.uk and general.enquiries@cma.gov.uk
Cc copy to copy
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Dame Gillian Guy Chief Executive Citizens Advice
gillian.guy@citizensadvice.org.uk
Carolyn Harris MP and Vice President Trading Standards
carolyn.harris.mp@parliament.uk
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Jess Phillips MP and Vice President Trading Standards
jess.phillips.mp@parliament.uk
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Helen Whatley MP
helen.whately.mp@parliament.uk
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Nigel Huddleston MP Minister for Tourism
nigel.huddleston.mp@parliament.uk
Trading Standards
Carole Keeble Admin Holiday Parks and Other Parks
James Plunkett Executive Director of Advice and Advocacy Citizens Advice
james.plunkett@citizensadvice.org.uk
Back Bench Business Committee
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Pettitions Committee
petitionscommittee@parliament.uk
Which support@which.co.uk
And anyone else you think it would be helpful for them to know, Martin Lewis (moneysaving expert) , Dean Dunham (theconsumerlawyer). Post the letter on your own Facebook pages or Group pages.
Online complaint to CMA
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Then visit the following link and follow the process for making a formal complaint
https://www.coronavirus-business-complaint.service.gov.uk/
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