Bermuda has heard at first hand from the British Government of the possibility that the after-effects of the US terrorist attacks could be 'dramatic' on the Island's communication links with the world.

OverseasTerritories Minister Baroness Amos said failure to meet new security measures being introduced in the wake of the incidents could be serious for any territory.

The issue was top of the agenda at a meeting of the Overseas Territories Consultative Council this week, at which Premier Jennifer Smith was present.

Baroness Amos said: "It is inevitable that the short term effects, especially on the Caribbean Territories and Bermuda could be dramatic.

"The sectors which have been worst hit - tourism, the airline industry, investment, insurance and financial services, are the sectors on which some of your economies depend. I am sure that we will want to talk about these issues in this session. For example, the tragic events of 11 September will have dramatic implications for any civil aviation or airport authority which fails to meet the stringent new measures that are being introduced worldwide."

The Baroness also signed an Environment Charter committing Britain and the colonies to work in partnership for the benefit of the environment. The charter was signed at the end of the Consultative Council meeting yesterday.

Baroness Amos said: "The adoption of this Environment Charter by the UK and the Overseas Territories is a powerful indication of the importance we attach to the environment both locally and globally. It represents our shared commitment to working together for the future health of our environment."

The document sets out guiding principles and contains "some real long-term commitments which will make a practical difference to our environment", she added.

"The environment, after all, is critical to the future prosperity, well-being, and even survival, of many of the Overseas Territories and their communities. Both global and local actions are needed. This document shows how we can all contribute."

Representatives - which included Anguilla, the British Virgin Islands, the Cayman Islands , the Falklands Island, Gibraltar, Montserrat, St. Helena and the Turks and Caicos Islands - were also told that the British Overseas Territories Bill, which gives full British citizenship to Overseas Territories citizens, will become law by the end of this year or early next year, after receiving Royal Assent. Baroness Amos used the meeting to deny charges that Britain acts unilaterally in its dealings with the colonies.

A "good deal of progress" had been made since the terms of a new "partnership for prosperity" were laid three years ago, she said.

The Minister, who was chairing the meeting for the first time, said that based on a meeting of Overseas Territories Governors held earlier this year, Britain's relationship with its Territories is strong.

"I think it fair to say that a good deal of progress is being made across a range of issues," she said. But, she said, "three issues in particular - financial regulation; the Order in Council on homosexual acts and the Government's slow progress on delivering on the White Paper commitment to grant British citizenship to BDTCs - had obscured that progress."

"There was also a perception that the relationship is too one-sided, that we in London follow our own agenda and priorities and expect the Overseas Territories to toe the line. This is far from the truth. Like my predecessor, I am committed to working in partnership to our mutual benefit."

A broad range of other policy areas were tackled during this year's meeting, including human rights, aviation, financial and tax issues and education.

Some of the Territories had planned to demand more aid and autonomy from Britain.

"I see vigorous debate and discussion as a testament to the maturity of our relationship."

Ms Smith, who was accompanied by her chief of staff, Senator David Burch, Cabinet Secretary John Drinkwater and Attorney General Dame Lois Browne-Evans, introduced a session on Immigration and Nationality.