Rules restricting professional incorporations are to be relaxed Finance Minister Paula Cox said Friday.

Currently registration of companies in businesses such as law, accounting, dentistry, medicine, health services or architectural services have been restricted with such professions only allowed to form partnerships.

She said the policy change would put professionals on the same limited liability footing available to providers of other services such as project management, construction and building services and repairs services.

Ms Cox said: ?Historically it has been accepted that professionals must stand behind their services and take on unlimited liability. However, times have changed. In the past it was rare for clients to sue but clients have become more litigious.

?In some cases, professionals are seen to have ?deep pockets? and as a consequence are drawn into litigation.?

She said in a global economy partners from different parts of the world may be joined in a court action involving the actions of its global partners.

?As partners may be sued jointly and severally, an individual partner may be held responsible even though he or she was not involved in offering the services required.?

Government has studied legislation in the US and Canada where professionals can incorporate provided they are licensed by the relevant professional body and meet minimum insurance requirements.

?Similar developments have taken place in the UK. It is important for Bermuda to stay abreast of such developments in order to maintain its position as a jurisdiction of choice for international business.

?If professionals choose to incorporate the services will be provided by the company which itself will have limited liability.

?Professionals will be directors and employees of the company and will have all the rights and protections of any other director or employee of a company incorporated under the Companies Act 1981.

?At common law, individual professionals may be liable as directors or employees of the company.?

In order to move forward with the incorporation of professionals, each professional body must adopt the necessary provisions to oversee the regulation of professional companies.

The relevant professional body must ensure there is adequate insurance coverage and that the professional companies will be bound by all codes of conduct and regulations which are imposed on individual members.

Although companies do provide limited liability protection, individual professionals must still abide by all professional regulations, said Ms Cox.

She said Government is taking prudent action to ensure this process is done in a manner that meets Bermuda?s needs to remain competitive without compromising its commitment to quality as a jurisdiction.