Reports that the UK would consider threatening Bermuda with pressure on the US over its tax treaty with Bermuda were yesterday denied by Deputy Governor Peter Willis.

Mr. Willis said: "The reports are untrue, uninformed and entirely misleading.'' He was reacting to reports in The Royal Gazette that Britain would contemplate leaning on its special relationship with America to end the treaty if Bermuda did not fully comply with whatever Britain felt was necessary to fulfill the rules amid a new crackdown on dodgy offshore jurisdictions.

The news came as the Bermuda Government submitted the first of three reports to international bodies to support its claim it does not belong on a hitlist of dubious so-called tax havens.

The 30-nation Organisation for Economic Cooperation and Development, the G7 group of the world's major economic powers and the EU have all asked for information on Bermuda's tax position.

Mr. Willis said: "It's true that several tax issues are being discussed -- it's a very complicated area and perhaps its easy to confuse them.

"But there is no question of the UK threatening anyone. I have no knowledge of it and the Ministries I have spoken to in the UK have no knowledge of it.

"There are discussions going on and they are going on in an entirely professional manner. This is very unfortunate, it's potentially damaging to Bermuda and I've put the record straight.'' The controversy broke out after Premier Pamela Gordon and Finance Minister Grant Gibbons, along with the heads of other Overseas Territories, were called to the Foreign Office in London to discuss tax issues.

British Civil Servants insisted all the leaders of the Territories did not discuss the content of the meeting -- likely to be the first of several -- outside the conference chamber.

And a Foreign Office spokeswoman later said it would not be issuing any statements on the meeting.

Britain -- on behalf of Bermuda -- signed a tax treaty with the US in 1986 which gives tax breaks to American insurance companies doing business in Bermuda.

US firms holding conventions in Bermuda also get a financial spin-off -- a lucrative market for the Island.

In return, Bermuda is obliged to supply the US Government and Internal Revenue Service with certain information on US companies and individuals if requested.