Islands, the law firm said in its December newsletter.

The move means CD&P, which incorporates and manages BVI International Business Companies (IBCs) through its various subsidiaries there, can now advise on BVI law.

The firm has had a BVI presence since 1988 when Codan Trust Company (BVI) Ltd., Codan Managements (BVI) Ltd. and Codan Services (BVI) Ltd. were set up.

A management office was opened in 1990 when Codan Trustees (BVI) Ltd. was incorporated to act as trustee of international trusts under BVI law. The vehicles are owned by CD&P partners.

CD&P is believed to be the first stand-alone, non-BVI law firm permitted to practise law in the Caribbean British dependency. Earlier, a Jamaican law firm merged with a BVI law firm and was given a BVI government Trade Licence to practise BVI law.

CD&P senior associate lawyer Donald Malcolm said with BVI wanting to incorporate more permanent companies, offering legal advise was more commercially viable. "In BVI, about 10,000 companies incorporate per year.

They have tended to be personal holding companies with bearer shares. But BVI is trying to diversify away from the traditional, simple IBC.'' BVI is looking for more "mature, complex'' companies which will do more in, and for BVI, have more of a physical presence, produce employment, generate more revenue, he said.

The average life of a BVI company is short, perhaps only two years, he added.

"With the increasing range and sophistication of international business vehicles now capable of being established in BVI, it was felt that CD&P should expand the scope of the firm's own operations in BVI,'' CD&P said.

Since the passage of the International Business Companies Act 1984, BVI has rapidly expanded as an offshore financial services jurisdiction. BVI government has encouraged international business development by updating existing legislation and passing new legislation expanding services for international business, CD&P said.

"This flexibility, together with exemption from BVI taxation and reasonably priced services renders BVI an attractive alternative jurisdiction for today's insurance needs.'' In 1994 BVI passed an insurance act. The result of a four year effort, it was the foundation for developing the jurisdiction's insurance sector and regulating insurers.

Prior to 1994, insurance companies had incorporated in BVI but were not as tightly regulated.

Legislation in the '90s prompted many BVI insurance companies to go elsewhere leaving behind a "core group of companies properly capitalised,'' BVI Supervisor of Insurance Peter Bates said.

Insurers currently make up a tiny percentage of BVI's 200,000 companies. BVI has 172 registered insurance companies, 126 of them captives.

After BVI's captives, the next largest group are domestic insurers, 23.

Insurance agents, insurance managers, offshore brokers and claims adjusters account for the remainder.

In the year ahead, BVI plans to "step up marketing'' as a captive insurance company incorporation jurisdiction, Mr. Bates said.

"While there are a number of offshore jurisdictions offering themselves as a location for international captive insurance companies, with Bermuda being the premier jurisdiction, considerable opportunities exist for the formation of these vehicles in BVI.

"Insurance entities can be incorporated as IBCs with much of the flexibility that has made BVI the dominant jurisdiction for establishment of IBCs,'' CD&P said.

Bermuda is the world's largest captive insurance company domicile. About 1,200 of its 1,454 insurance companies are captives.

As well as Bermuda and BVI offices, CD&P has operations in Cayman Islands, Guernsey and Hong Kong.

CD&P's BVI companies, as well as the new BVI legal practice, are located Romasco Place in Road Town, Tortola.

CD&P was given a BVI government Trade Licence in October.

"We're pleased so far. We've had a good flow of business,'' Mr. Malcolm said.

Initially manning the BVI law office is CD&P associate lawyer Guy Eldridge, with the firm since 1987 and called to the BVI Bar earlier this month.

The BVI practice will advise on a full range of BVI legal matters including establishment of companies, partnerships, trusts, mutual funds and insurance companies as well as all aspects of corporate and commercial activities.

The firm will also advise on structuring transactions involving BVI companies.

Advice will be rendered in such specialist areas as insurance, mutual funds, trusts, aircraft/shipping finance and registration, the registration of security documents and local prospectus requirements.