Britain yesterday slapped a gag on leaders of the Overseas Territories after a top-level summit on a worldwide clampdown on financially dodgy jurisdictions.

UK officials imposed a surprise total news blackout on the meeting, attended by Premier Pamela Gordon and Finance Minister Grant Gibbons.

Ms Gordon last night said she would comply with the Foreign Office request for a wall of silence on the marathon meeting.

But she confirmed: "Every jurisdiction showed significant concern for their relative countries.

"Most smaller countries have limited economies, so naturally there would be extra concern for the potential devastation of any economy if some decision were to arbitrarily affect the ability of their country to continue to run in an efficient manner, or at least a manner in which the UK deems to be efficient.'' The meeting was called amid concern that "harmful tax competition'' from offshore jurisdictions was hitting the major powers.

Involved in yesterday's meeting were representatives from the Cayman Islands, British Virgin Islands, Turks and Caicos, Anguilla, Montserrat, the Falklands and Gibraltar.

Ms Gordon said: "People were disconcerted -- the position of each country was put and each of the representatives spoke passionately about their specific concerns.

"But it was agreed that all participants keep confidential the actual contents of the meeting because there will be other meetings which will hopefully take us closer to resolving this matter.

"The UK felt it would be more beneficial at this stage not to have the finger pointed at specific jurisdictions.

"The rationale is that this could be a sensitive issue and it could send the wrong signals to businesses or whatever.

"Rather than create a sense of alarm, it was deemed to be the best way to handle it, so we're honouring the agreement.'' A spokeswoman for the Foreign Office refused to comment on the day's talks.

The talks -- scheduled to finish around 4 p.m. -- overran by nearly two hours, but a further meeting slated for today was cancelled.

And Bermuda faces its first hurdle in the race to stay off a blacklist of countries next month, when a report outlining Bermuda's case has to go to international financial watchdog the Organisation for Economic Cooperation and Development has to be submitted.

And the G7 organisation of the world's major economic powers, including Britain and the US, have asked for a report on the same subject to be in its hands by mid-October.

In addition, Bermuda will also have to defend its tax system to the European Union following the first two reports.

All of them want a get-tough policy on countries with two-tier tax systems designed to attract offshore business.

But Ms Gordon insisted: "We don't have a system for one group and another for another group.

"We don't have taxes on profits, but international business pays the same taxes as everyone else.

"Our job now is to show in the body of our report very clearly why we should not be included on any list.'' The UK Parliament is currently on holiday and Donald Anderson MP, chairman of the influential Foreign Affairs Select Committee, stressed he had not been briefed on the talks.

But he said: "Since we are responsible for foreign representation, we could find ourselves suffering great embarrassment internationally unless we have a degree of oversight.

He added, however: "There has to be a degree of flexibility for competition purposes.

"It may well be that in the OECD and the EU to tighten regimes, but as long as they are not stifling proper competition, I see no great problem in that.'' But one UK Parliament insider accused the OECD of an `arbitary' selection of countries it wanted to quiz.

And he warned Bermuda and the other Territories that success in keeping off an international hit-list would be "a matter of building coalitions''.

He added: "It all depends on the motive -- it could be, at the negative end, simply to stop small countries making money by having a better and more competitive product or to stop villains manipulating and exploiting these countries.

"And -- if countries have a good case -- they have to ensure that that case is put strongly to our negotiators in the relevant forums.'' TAXES TAX