burgeoning financial services sector.

The recommendations submitted by the Bermuda International Business Association (BIBA) could result in the drafting of a Financial Services Act.

But Minister of Finance the Hon. David Saul said yesterday it was still `a moot pint'' whether the recommendations would be a separate Act or part of the Companies Act.

Lawyer Mr. John Collis, chairman of BIBA's securities and financial services committee, said Government needed to establish greater control over the area.

So far, three key areas have been discussed by a BIBA panel. Areas said to need tighter regulation include share offerings and prospectuses; exempted company legislation and thirdly, investment management service providers.

"This is to protect Bermuda's reputation,'' Mr. Collis said. "It is similar to action taken by the insurance industry in the late 1970s to produce basic regulations that ensure less scrupulous players do not enter the market.'' At this stage, technical officers at the Bermuda Monetary Authority and the Ministry of Finance, who are consulting with the Attorney General, are reviewing the BIBA committee's report.

Mr. Collis identified a need to "tidy up and make more consistent the legislation that applies to offerings of shares in companies and also the law that applies to prospectuses''.

"We have recommended there should be a common set of rules in respect of companies and other vehicles, such as partnerships and unit trusts, for instance. Currently, there is no consistency,'' he said.

BIBA also wants to ensure that foreign companies that offer securities to Bermuda residents should meet basic rules and standards of disclosure.

"We are trying to propose means of tidying up the manner of regulating exempted companies entering Bermuda.

"At the moment, exempted companies are regulated by the BMA. It has always been considered odd that Bermuda's international business can set up here and offer shares once granted permission under an exchange control law.

"This law is aimed at currency controls and not securities regulations. It makes more sense to regulate exempted business under a financial services act, than a currency movement law,'' he said.

Thirdly, Mr. Collis said that a desire exists in Bermuda to ensure a common standard is applied to all companies providing investment management services.

"They will be made subject to a licensing requirement, so as to ensure those holding themselves out as offering investment advice have the necessary expertise.

"BIBA does not intend that Government impose a terribly onerous set of regulations. BIBA proposes that investment management companies should be subject to a licensing procedure similar to those applicable to other professionals, like lawyers and accountants.