capturing a flourishing e-commerce market, a report states. An unrestricted immigration policy on work permits is also essential. Deidre Stark reports Bermuda's stellar international business reputation will not simply transfer into a thriving e-commerce market, a new study has warned.

And unless serious wrangles in the Island's telecommunications industry are solved and other social issues like the issuing of work-permits to foreign workers are addressed, Bermuda could miss the e-commerce boat all together.

International Management Consultants William R. Storie & Co. Ltd. published the "Will e-Commerce Succeed in Bermuda?'' discussion paper this week after several months of global research.

The company was a front-runner for the contract to draft Bermuda's e-commerce legislation -- which went to London-based law-firm Linklater's last month.

Last night the company's president Bill Storie said that too many people and gushing reports simply assumed Bermuda was going to capture e-commerce business without specifying the obstacles.

He said this latest report was not intended to be positive or negative but to identify issues to be addressed and spark widespread discussion.

The report is based on online searches, workshops and meetings with law firms, Lloyd's of London, LIMNET, as well as trading, technology, insurance, investment and network security companies in Bermuda, London and New York.

It identifies quality telecommunications as a potential thorn in Bermuda's effort.

"If we don't get our international telecommunications industry working, and working competitively, then e-commerce will zoom past our shores at high speed -- never to return,'' the report says.

"The engine room of any e-commerce business is a high-quality, global outreach telecommunications network, the highway. If it were to be cost efficient as well, then even more business would look at Bermuda seriously.

"Issues of bandwidth, fault tolerance, 24-hour service, security and so forth are critical to our success.'' Another vital issue the report identifies at the heart of the issue is Bermuda's Immigration policy and the snarls often involved in issuing work permits.

Mr. Storie did not want to comment on the Elbow Beach Hotel's current work-permit dispute with the Government.

But he said if the "e-commerce explosion'' was to take off in Bermuda it could need up to 2,000 employees.

And a committed effort by the Government and education facilities had to start now to propel young Bermudians into those ranks.

Island warned e-commerce success is `not inevitable' But if all the positions could not be filled with locals it would be necessary to bring in many foreign workers to "fill the gaps'', he said.

The report says: "Any tendency to unreasonably restrict foreign worker entry may thwart immediate e-commerce development, if Bermuda is to take a leading position worldwide.'' The Bermuda's Government should also avoid falling into the trap of drafting the necessary legal framework for e-commerce and then just waiting for it to happen.

"Bermuda Government's initiative to appoint framers thereof is to be warmly applauded. Let us however be very careful not to assume that a proper legislative framework will, in and of itself attract e-commerce to Bermuda.'' Bermuda's captive insurance industry thrived despite the fact that a legislative framework did not exist for ten years after captives began setting up here, it points out.

And e-commerce entrepreneurs would quickly find other jurisdictions in which to operate unless expensive red-tape in the review process of proposals was minimised.

The report calls for the appointment of a Government Minister to listen and adjudicate on new applications and changes to business objectives without having to drag them through a long process of legal compliance.

It is also suggests local business groups like the Chamber of Commerce and BIBA unite to forge a Bermuda e-commerce Association which could set the standards and guidelines of good practice.

Mr. Storie said Bermuda could not afford to think e-commerce success was inevitable.

"There's been a tendency for people to think that because Bermuda has such a strong position globally in the insurance industry that we'll simply open up tomorrow and because we've got the technology in place we'll be okay.

"That's not how it works. This report is saying that we have to bring a balance in the package we offer.

William Storie