The destination club Association (DCA) has recently issued a "Code of Responsible Business Conduct" for its member clubs to abide by. We spoke to Adam Wegner, the President of the DCA, to find out about these latest developments.

The DCA was formed in the middle of 2006 following various meetings among member clubs starting in 2005. In July 2006, the DCA adopted a set of industry-wide Best Practices, which was the DCA's first formal action as a newly formed industry association. These Best Practices covered four main topics:

• Comprehensive Consumer Disclosures
• Accurate, Truthful and Appropriate Marketing and Sales Practices
• Financial Responsibility
• Responsible Industry Growth

The new Code of Conduct from the DCA really builds on the earlier Best Practices and all members of the DCA must adhere to this Code in the operation of their clubs. The Code includes sections on:

• Rescission, giving members 7 days after joining to change their mind and receive a full refund
• Disclosures, including membership types, reservation rules, club homes, refund policies
• Financial Responsibility, including annual audits and a net asset test
• Prohibited Acts, such as misrepresenting the membership benefits, the homes and availability

The group has also drafted a "Model Act" as a template for states to adopt legislation specific to destination clubs. Hawaii is the only state that is currently reviewing whether it should adopt specific legislation, although pretty much every state has decided that timeshare law does not apply to destination clubs. While there is no destination club specific legislation, members are covered by standard contract law and laws such as misrepresentation in advertising.

Adam mentioned that as a young dynamic industry the clubs and their business models continue to evolve, and as such he very much encouraged feedback from members and prospective members. In addition to being the President of the DCA he is also the SVP and General Counsel at Exclusive Resorts.

While the Code of Conduct and Best Practices don't (yet) have legislative teeth, they are certainly a reassuring sign for members and prospective members. The DCA is encouraging all destination clubs to abide by these requirements, and as we mentioned above they are mandatory for any club that is a member of the DCA. Our 60 page Guide to Destination Clubs goes even further than the Code of Conduct in that it provides prospective members with a series of due diligence questions to ask the clubs prior to joining. We recommend reading these documents before joining a club.

 (Image: Exclusive Resorts home in Megeve France)