THE "snail's pace" legislative process in Bermuda must be accelerated if the island is to remain a competitive player in the world of international finance, Shadow Legislative Affairs Minister John Barritt has warned.

The United Bermuda Party MP spoke out after the Segregated Accounts Companies Ammendment Act was tabled but not debated for four months because there wasn't time to fit the lengthy bill into the legislative calendar. He said the delay showed there was a need for a reform of rules in the House of Assembly.

"Last Friday in the House of Assembly we debated a piece of legislation on how it was important for Bermuda to pass the Segregated Accounts Companies Ammendment Act which would keep Bermuda well-placed to be competitive in the world of international finance," he said.

"I pointed out that it was tabled on December 14 but not taken up until last week, to show that as a legislative body, we were not (operating) in a timely fashion and it was a matter of concern to those in the industry. It shows a need to reform our rules in the House of Assembly.

"We want to put ourselves on the cutting edge of the international financial services industry but if we take this long it undermines the whole idea of being timely. It sat there for four months because we couldn't find a slot to fit a bill of that magnitude and when we came back in February, we were preoccupied with the Budget."

Mr. Barritt said that he had brought up the need for change but, as of yet, nothing had been done. "Over a year ago I made a number of suggestions as to how the rules of the House of Assembly could be reformed so as to not hold up legislation with long bills. It shows a need for a Committee to facilitate and expedite the passage of critical legislation, something like the Private Bills Committee.

"The time would then be cut down. Things would get through a lot quicker, especially when it's an important piece of legislation, especially when we're dealing with bi-partisan bills of this nature, issues that are neither contentious nor controversial but which will benefit all Bermudians.

"Why aren't we ammending the rules? It's so obvious that there has to be a better way of dealing with this so that we have a more effective and efficient use of our time."

The Segregated Accounts Companies Ammendment Act will allow mutual funds - and possibly Bermudian businesses - to segregate their accounts in the same way as insurance companies and will also keep Bermuda competitive with other offshore jurisdictions such as Guernsey, the Cayman Islands, the Bahamas, and the Republic of Ireland. Mr. Barritt said that the Act was an important one.

"It's an important piece of legislation and allows for the statutory development of a form of company whereby different lines of business or services can be protected from creditors by starting up separate, segregated accounts," explained Mr. Barritt. "So far it has been used by the insurance industry but it is of interest to other industries as well and it's a bill that is of keen interest to attorneys. It's the mother of companies, as it segregates accounts without (companies) necessarily having to go and set up subsidiary companies.

"Because it's a different and unique concept and now known to common law, it's important to have a statutory provision to facilitate this happening and to protect people as well."

Legislation to amend the Segregated Accounts Companies Act 2000 was introduced following recommendations from Bermuda International Business Association (BIBA).

The Ammendment would offer a number of benefits, said Tom Conyers, chair of the BIBA Legislative Change Committee.

"The original registration and approval process was a little complex and made it difficult for companies which had segregated accounts by virtue of a private act to register as well as being a complex process for new registrations and we've streamlined that," said Mr. Conyers. "We'd like to think that we have more private accounts receiving the benefit accrued to companies which register under the public act.

"The original act did not explicitly make it clear that one segregated account in a company could transact business with another segregated account or with the general account.

"The new act makes that explicit and sets out the ground rules under which those transactions operate. We have made it simpler for mutual funds to use, in particular for umbrella funds and master feeder structures.

"We have created some sections or provisions that allow a company to respond to issues caused when a court in a foreign jurisdiction deals with a segregated account company that's incorporated in Bermuda. We've also fixed and fiddled with a number of technical issues and removed the requirement that companies must have the letters 'SAC' in the company name so they wouldn't have to change the name of the existing company if they wanted it registered.

"We have required, that on their letterhead and in their contracts, they must make it clear that they are a segregated accounts company. Hopefully this will expand the number of companies that take advantage of the provision and hopefully the Ministry will soon, as a matter of policy, see fit to open (the Act) to mutual fund and regular companies that seek to take advantage of its provisions."