New laws loosening regulations on trusts are a vital in Bermuda's battle to stay ahead of the pack, Finance Minister Grant Gibbons said yesterday.

Dr. Gibbons told the House of Assembly Bermuda had been a leader in trusts -- but that competing jurisdictions had followed that lead.

He said: "We had, for want of a better word, perhaps become a little old-fashioned.'' Dr. Gibbons was speaking as he introduced the Trusts (Special Provisions) Amendment Act 1998.

The Act broadens the scope to use trusts for non-charitable purposes and remove the need for one of the trustees to be a "designated person'' -- in effect a barrister or accountant. The Island will also axe a register of "purpose trusts.'' Dr. Gibbons said: "As Bermuda was the first offshore jurisdiction to use purpose trusts, there are a number of safeguards built into the Act because it was a very new process.'' Shadow Finance Minister Eugene Cox said: "When you look at what is happening in the international sphere in purpose trusts and other types of measures and instruments, one has to conclude that Bermuda is certainly at a crossroads in her history.

"As the Minister has said, we are not so much the prima donna when you look at islands like the Caymans and Jersey. I agree we must be looking at our laws and updating and streamlining them.'' Youth and Sport Minister John Barritt said: "In some areas we fell behind because we basically chose to fall behind because we don't want to change the Bermudian culture in terms of knowing our clients.'' He added the cost of doing business in Bermuda was not so important as "the services being worth the cost of doing business in Bermuda.'' Shadow Community and Cultural Affairs Minister Paula Cox added the subject was probably a turn-off for most people not involved in the field.

But she said changes to the law "would protect the assets for ordinary people -- not just the super-rich.'' And Ms Cox -- a barrister in the field -- added: "We are at a crossroads.

We're seeing trusts being used much more inventively and trustees are having to be much more entrepreneurial.'' Finance Minister Grant Gibbons