California Code of Regulations › Title 10 - Investment › Chapter 6 - Real Estate Commissioner › Article 12.2 - Time-Share Project › Section 2811 - Time-Share Advertising Criteria

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Standards which will be applied by the Real Estate
				  Commissioner in determining whether advertising for sale or lease of time-share
				  interests is false, untrue or misleading within the meaning of those terms in
				  Section 11245 of the Code shall include,
				  but shall not be limited to the following:
(1) Advertising shall not represent the
				availability for use of a time-share interest that is not set forth in the
				public report.
(2) A time-share
				plan shall not be advertised under a name that is not set forth in the
				application.
(3) A time-share plan
				shall not be advertised by a name or trade style which implies, contrary to
				fact, that the developer or his agent is a bona fide research organization,
				public agency, nonprofit organization or similar entity.
(4) No accommodation, improvement or
				facility, over which the developer does not have control with respect to
				completion, may be advertised unless (1) it has been completed (2) completion
				is assured through bonding or other arrangements approved by the commissioner,
				or (3) a clear and conspicuous disclosure is included in close proximity to the
				mention or depiction of the advertised accommodation, improvement or facility
				stating that the accommodation, improvement or facility is proposed and may not
				be built.
(5) Reference shall not
				be made to a proposed public facility or project which purports to affect the
				value and utility of time-share interests without a disclosure of the existing
				status of the proposed facility based upon information supplied or verified by
				the authority responsible for the public facility or project.
(6) Pictorial or illustrative depictions of
				the time-share property and surrounding lands must accurately portray the land
				as it exists and proposed improvements as they will be constructed.
(7) Pictorial or illustrative depictions
				other than unmodified photographs shall bear a prominent disclosure identifying
				the nature of the depiction, e.g., ARTISTS CONCEPTION and a legend identifying
				those improvements which are not then in existence.
(8) If a map or diagram is used to show the
				location of the time-share property in relation to other places, actual miles
				from each other place to the time-share property shall be shown or the map or
				diagram shall be prepared to scale and shall include a scale of miles or the
				map or diagram shall be prominently marked "Not to Scale."
(9) If the existence of a lake, river, canal
				or other body of water, which is subject to a fluctuating water level other
				than through natural causes, is advertised as a feature of the time-share
				property, any significant effect of the fluctuation upon the use of the water
				facility and upon the time-share interests shall be described.
(10) No advertisement shall imply that a
				facility is available for the exclusive use of purchasers of time-share
				interests if a public right of access or of use of the facility
				exists.
(11) Full disclosure shall
				be made of the conditions or restrictions upon the availability for use by
				owners of time-share interests of private clubs or facilities in which an owner
				will not acquire a proprietary or contractual interest through purchase of a
				time-share interest, including, if applicable, that the use is at the pleasure
				of the owner of the facility.
(12)
				No representation may be made that time-share interests being offered for sale
				can be further divided unless a full disclosure is included as to the legal
				requirements for further division of the interests.
(13) Time-share interests may not be
				advertised as available at a particular minimum price if the number of
				time-share interests available at that price comprise less than 10% of the
				unsold inventory of the developer, unless the number of interests then for sale
				at the minimum price is set forth in the advertisement.
(14) Advertising of a discounted purchase
				price shall not be made unless the developer has established base prices for
				application of the discount through a substantial number of sales at base
				prices.
(15) A prospective increase
				in the price of a time-share interest may not be implied nor shall a price
				increase of such a time-share interest be announced without announcing the
				approximate date on which the increase will be placed into effect, and without
				a good faith belief that the price increase will be placed into effect on that
				date.
(16) If the phrase "closing
				costs only" or similar terminology is used to describe the price of a
				time-share interest, the estimated dollar amount of the costs must be set forth
				in the advertisement.
(17) No
				representation shall be made as to the availability of a resale program offered
				by or on behalf of the developer, unless the resale program is then in
				existence and the extent and intended duration of the resale program and any
				restrictions on the program are fully disclosed to the prospective
				purchaser.
(18) An asterisk or
				other reference symbol may be used to explain, but not to contradict or to
				change the ordinary meaning of the material in the body of the
				advertisement.
(19) Unless an offer
				made in connection with a sales promotion is unequivocally without conditions,
				the terms "free", "no obligation" or similar terms may not be used to describe
				that which is offered.
(20) Offers
				of travel, accommodations, meals or entertainment at no cost or reduced cost,
				the purpose of which is to promote sales, shall not be described as "awards",
				"prizes" or similar terms.
(21)
				Offers or solicitations of trip reservations to visit time-share property or
				any other place where a sales presentation for subdivided property is to be
				made shall set forth all conditions, limitations or qualifications that will be
				applied before the recipient will be allowed to make the trip.
(22) The approximate retail value of any
				gift, prize or premium offered through an advertisement to prospective
				purchasers shall be set forth in the advertisement. This requirement is limited
				to gifts, prizes or premiums with a retail value in excess of $25.
(23) Complete rules and procedures for any
				contest or drawing advertised in connection with the marketing of time-share
				interests shall be included in the advertisement, or the advertisement shall
				state the means by which a person can secure full information concerning said
				rules and procedures prior to his participation in the contest or
				drawing.
(24) Advertising shall not
				include testimonials or endorsements which contain matters which the developer
				would be precluded by law or regulation from making in his own
				behalf.
(25) An offer or inducement
				to purchase which purports to be limited as to quantity or restricted as to
				time shall set forth the numerical quantity and/or time applicable to the offer
				or inducement.
(26) No direct mail
				advertisement purporting to have resulted through a referral shall be used
				unless the developer can, upon request of the commissioner, provide evidence of
				the referral. Names purchased from marketing lists and similar commercial
				sources are not considered "referrals" for purposes of this section.
(27) Statements appearing in the public
				report for a time-share plan shall not be quoted, paraphrased or cited out of
				context nor shall any part of the public report be underscored, italicized,
				bold faced or otherwise highlighted except in strict conformance with
				highlighting in the public report itself.
1. New
				  subsection (a)(24) filed 6-20-2002; operative 7-20-2002 (Register 2002, No.
				  25).
2. Repealer and new section filed 5-5-2005; operative 7-1-2005
				  (Register 2005, No. 18).
Note: Authority cited: Section
					 11281,
					 Business and Professions Code. Reference: Section
					 11245,
					 Business and Professions Code.