LONDON -- Government officials would oppose the grant of full British citizenship to Bermudians if it put the Island's international business sectors at risk.

Home Affairs Minister Quinton Edness said last night that legislation which allowed foreign authorities to go on "fishing expeditions'' of Bermuda-based businesses could wreck the Island as an offshore business centre.

And Premier Pamela Gordon said she had told British Foreign Office officials that while Government was seeking British citizenship for Bermudians, it was not prepared to do so to the detriment of the Country.

Ms Gordon is leading the Government delegation which will tomorrow hear UK Foreign Secretary Robin Cook outline how Britain proposes to change the way it administers its Dependent Territories.

The heavy price tag required for British citizenship was revealed in yesterday's edition of The Royal Gazette , which reported Britain would demand that people accused of money laundering and financial crimes be tried under English law.

Other demands which other British Parliamentary sources said would be contained in Mr. Cook's speech to the Dependent Territories Association included the repeal of the death penalty, decriminalisation of homosexuality and an end to corporal punishment.

"I expect that they really will propose some serious stuff,'' Ms Gordon said last night. "It is a carrot and stick approach.'' But she said in her talks last week with Foreign Office Junior Minister Baroness Symons, she made it clear that Bermuda would not pay any price for British citizenship.

She said Britain was especially concerned about its image as it had just taken up the presidency of the European Commission and was worried it would be held accountable for the actions of its Dependent Territories if they were in breach of its European treaty obligations.

"I'm hopeful this is an opening stance and not a take-it-or-leave-it offer,'' she said.

"I think Britain would like to play hardball but would not be prepared to be so dogmatic about the issues that it would result in bad press. If they seem too heavy-handed, they could backfire.

"I will say that Baroness Symons seems to be a conciliator and she seems at least willing to understand that any change will not happen overnight and needs to be discussed.'' International business risk Mr. Edness said Bermuda's new Proceeds of Crime Act would ensure the successful prosecution of money-launderers.

"I suppose that if it were the case that a jurisdiction did not have the wherewithal or if it were the case that a person had committed offences in Britain, then they could be tried there,'' he said.

"But the purpose of each jurisdiction having its own law is to try them in each jurisdiction.'' Mr. Edness said changes to financial crimes legislation could only come after further talks with Britain.

"If there's anything further that we are being required to do, we do not want it to be something which will place us at a disadvantage against our competitors,'' he said.

The Proceeds of Crime Act was redrafted last year after international business leaders said the original bill was too invasive and would allow foreign authorities to go on fishing expeditions against suspects without sufficient cause.

The amended bill said inquiries from abroad could take place if the suspects had been convicted elsewhere and there was evidence to show the law had been broken in Bermuda.

Changes to money-laundering and financial legislation are seen as one of the major stumbling blocks to the development of a new relationship between Britain and its Dependent Territories.

But British officials and MPs argue that Dependent Territories would benefit from having a good reputation for financial regulation.

"In the long run, no territory can benefit from offering poor regulation,'' said Diane Abbott, a member of the House of Commons Foreign Affairs Select Committee.

"If you offer weak or inadequate supervision as an advantage, there will always be a jurisdiction which offers supervision which is even weaker,'' she said.

Sources said one reason for Britain placing a heavy emphasis on financial regulation and human rights issues like capital punishment stemmed from its treaty obligations with other European nations.

Britain also believes it needs to toughen up on financial regulation to ensure that it complies with European tax codes, a Government official said.

"They are afraid a hanging or a financial scandal will embarrass them,'' he said.

"There is also a tendency to equate tax avoidance, which is quite legitimate, with tax evasion, which is criminal.'' But British MPs said they did not believe the UK would force the issue on anti-gay sex laws or the abolition of hanging.