documents -- will be a key component of the "information highway'', local businesses were told at a seminar this week.

However, one local executive cautioned that until the Government's Telecommunications Commission makes a decision about granting licences to local companies, there is no way for businesses to connect and apply EDI locally or internationally.

Telco is understood to be investigating ways of connecting local companies so the EDI service can be used locally.

Mr. Paul Rowlerson, vice president at Johnson & Higgins (Bermuda), who attended the seminar said: "Progress is log jammed until the Telecommunications Commission makes a decision''.

Pennsylvania-based electronic business product and services company, EDI Able, which made the presentation at the Dinghy Club, said the biggest barrier, debarring use of EDI, is lack of knowledge.

The seminar was organised by On Lines, a local custom computer services firm.

Mr. Sri Sridharan, president and chief executive officer at EDI Able, said the traditional means of communication -- phone and mail -- can cause logistical problems, increased expense, human errors, and time delay.

He predicted there will be less data handling by humans, and computers and databases will provide information that enables humans to make intelligent decisions.

Whereas Electronic Mail is used to send simple, unstructured messages, EDI is highly structured, and uses data standards to communicate such documents commonly used in business transactions, such as purchase orders, invoices, bills of lading, freight bills and shipment status.

Mr. Rowlerson said an important legal issue for the insurance industry was responsibility for loss of a document transmitted by EDI. If a client's instructions about renewing an insurance policy are lost, who would be liable for any subsequent loss that is not covered, he asked.

Currently, a client will transfer a renewal document to the broker by a registered mail or telex, which provides an answer-back service, showing the message was received.

A recent Wall Street Times article revealed that the numerous break-ins of accounts of thousands of Internet users is heightening concern about the security of on-line systems. Internet is a network that provides access to certain public information.

Mr. Sridharan said there had never been a problem with EDI and security. To his knowledge, files or transaction had never been tampered with.

He advised companies to look for EDI products that will support multiple standards, show ease of maintenance, and ensure no new hardware is needed to get on to network.

Different EDI standards that exist are ANSI X.12 -- predominately used in the US, UN/EDIFACT -- monitored and maintained by the United Nations, and used internationally, UCS -- used by the grocery industry, WINS -- by warehouse operations, and VICS -- used in retail industry.

He said research by independent firms demonstrated the cost benefits of EDI.

Processing a purchase order in the traditional way takes 25 minutes, and using EDI takes 5 minutes, he said.

Companies that have implemented EDI, include Toys R Us, Sears, which will only deal with EDI-capable companies, and the Port Authority of New Jersey.