the setting up of trusts in Bermuda.

Finance Minister Eugene Cox told the House of Assembly that the original 1975 law had to be reviewed frequently "to be sure the legislation meets the needs of all Bermudians'' "The trust business must be supervised and Bermuda is one of the few jurisdictions where the business is licensed,'' he said.

The Trustee Amendment Act 1999 broadens the power of trustees to make investments -- as long as they are "prudent''.

The old law placed several restrictions on how trust cash could be invested, if they were not specified in the trust document.

And the ability of trustees to delegate responsibility to professionals has also been broadened.

Trustees will also not be held liable for delegating responsibility -- as long as they can prove they had no reason to believe that their choice was not suitable.

The new law also allows more flexibility in the use of trusts and allows trustees more leeway to make payments in advance of specific dates set down in trust documents.

The previous law made allowance for that -- but the law was not clear and the new Act more accurately states conditions.

Shadow Finance Minister Grant Gibbons said it was important to keep up-to-date with international thinking on trusts.

And he said: "There has been some criticism of trusts in other jurisdictions because they allow almost a breach of the arms-length nature between the person who sets up the trust and the trustees themselves.'' He added that all offshore jurisdictions were coming under increasing scrutiny by international watchdogs.

Dr. Gibbons said: "The legislative amendments are good ones, solid ones..it addresses the needs of the people who work in these areas.'' Shadow Legislative Affairs Minister John Barritt asked whether it meant any corporate body would now be able to admininster a trust, from any country in the world.

But Environment Minister Arthur Hodgson said the corporation would still have to be licensed in Bermuda.

The recommendations in the legislation, which sets out rules for trust administrators to follow, came after a report by UK consultants.

The Act received its third reading and passed.