recover billions of dollars lost to tax evaders, smaller nations singled out as secretive offshore tax havens met with their critics yesterday in an effort to protect their lucrative banking industries.

Bermuda, although invited to the meetings, did not send a delegation. A spokesman at the Ministry of Finance explained that organisers of the Barbados conference gave short notice.

"The timing of these sessions is not good for us at all in the Ministry,'' the spokesman said. "We are very busy with the Budget and other matters that take priority. We only learned of this meeting in mid December.'' According to the Ministry the Barbados meetings are specially geared to those countries which were blacklisted by the Organisation of Economic Cooperation and Development (OECD). Bermuda did not appear on that list as it signed a letter of commitment with the OECD.

"We will monitor the event but the Government feels very comfortable with the commitment we already have,'' said the Ministry spokesman, "and the organisers accept that it is tight timing.'' Countries discuss `harmful tax' practices Officials from about 40 countries and territories met behind closed doors to exchange views on what the OECD, a group of wealthy industrialised nations that includes the United States, terms "harmful tax practices.'' The Paris-based organisation has set what it calls international standards that it wants all nations to abide by. It is pushing nations with no-tax or low-tax regimes to change their tax laws.

Leaders in the Caribbean, home to some of the world's most attractive tax havens, say the developed countries are imposing the standards and trying to take away revenues from small islands with fragile economies.

"Those who gain market share call it exploiting the competitive advantage.

And those who lose call it harmful,'' Prime Minister Owen Arthur of Barbados said in an opening address.

Arthur, however, also urged dialogue in an effort to reach common ground. "It is only through consensus-building and cooperative action among states that we will arrive at norms and practices that are universally accepted and applied, and can eradicate activities that are patently illegal,'' he said.

OECD Deputy Secretary-General Seiichi Kondo said the organisation's recommendations are aimed at ensuring economic stability.

"We are not trying to set minimum tax rates, or in any way to interfere with the legitimate concerns of individual citizens to protect and maintain their privacy,'' Kondo said. "What we want to defend are the interests of honest taxpayers in all countries around the world.'' In July, the OECD released a list of 35 alleged tax havens. It has urged countries and territories on the list to commit themselves to cooperate in making changes by the end of July, said spokesman Nicholas Bray. The intent is to stop people and companies from illegally evading taxes by hiding behind secrecy laws, he said.

Last year, a related organisation called the Financial Action Task Force issued a list of 15 countries considered uncooperative in fighting money laundering. Money laundering involves exchanging or investing funds earned from illegal activities such as drug trafficking to conceal the source and make the money appear legitimate.

Although they bristle at the outside judgments, many Caribbean leaders are eager to avoid the stigma of being linked with dirty money, and a few have changed their laws to make them more open to foreign investigators.

The United States and Britain issued advisories warning their banks to scrutinise transactions through countries on the money-laundering list, and some islands have reported losing offshore banks since then. The United States and some other OECD member countries are threatening sanctions against governments that do not cooperate with efforts to curb tax evasion and money laundering.

Talking heads: Organisation for Economic Cooperation and Development Deputy Secretary-General Seiichi Kondo (right) is shown with Nicol William of the OECD during a meeting in Barbados.

On call: Don McKinnon, Commonwealth Secretary General, takes a call during a lunch break during a meeting with officials from about 40 countries and territories on what the Organisation of Economic Cooperation and Development terms "harmful tax practices'' at the Sherbourne Conference Centre in Two Mile Hill, Barbados.