registration of some of its vessels from Bermuda to Britain in response to new legislation in the United Kingdom.

P&O confirmed to The Royal Gazette yesterday that some of its ships registered in Bermuda will move to London as a result of the British Government introducing a new tonnage tax.

The decision will be a blow to the Ministry of Finance, which earns between $3,000 and $25,000 a year depending on tonnage for registering ships.

But the company said it may also register some new vessels in the future with the Bermuda Registry of Shipping.

The announcement by P&O confirms fears expressed in The Royal Gazette this week by Captain Pat Nawaratne, the Principal Marine Surveyor at the Registry of Shipping in Bermuda.

Capt. Nawaratne said he expected a number of ships registered in Bermuda and other offshore British territories to return to London because of the changes announced by British Transport Minister, John Prescott, which are due to be introduced in January.

The new plans will allow shipping companies based in the UK to pay tax to the Chancellor of the Exchequer based on tonnage rather than a corporation tax based on earnings.

Hundreds of ships have quit the British register in the past 20 years because it is cheaper to register in other parts of the world.

The new tonnage rate will not be revealed until the Budget in November but it is thought it will be less than the rate charged in Bermuda.

Speaking from London, P&O spokesman Peter Smith told The Royal Gazette : "We will be bringing some ships back to the UK register and that involves shipping on a variety of registers at the moment.

"There are some in Bermuda, but there are a lot in other registers such as Liberia, Hong Kong and the Bahamas. There will be some from Bermuda but we haven't reached a final decision about which ships.

"In some instances, we may be taking other ships into the Bermuda register.

We still regard Bermuda as an important location for us and there will still be P&O ships remaining on the Bermuda register.'' Mr. Smith was unable to confirm how many ships the company currently had registered in Bermuda.

Lawyer Stephen Rossiter, of Conyers, Dill and Pearman, which acts as agents for the largest number of ships on the register, said he was not aware that any of his clients were planning to transfer from Bermuda to London. Capt.

John Moore of Meyer Agencies said he had no indication that any of his clients were leaving the Bermuda register.