Foreign fast-food franchises should be allowed in Bermuda -- but heavily disguised and not at the Airport, a committee has recommended.

The announcement yesterday further confused the franchise issue -- coming a week after Government recommended that Grape Bay Ltd, operating as McDonald's, should be given the Airport food concession.

It also failed to impress the "People's Five'' who said the report was a whitewash and would not lead to any compromise over the McDonald's issue -- despite appeals to accept the recommendations.

"It is unbelievable that they think the public will take this report seriously,'' said Dr. Clarence Terceira, one of the `Five'. "It is a bit of a comedy.'' Tourism Minister David Dodwell yesterday released the report of the committee on Franchise Policy and Related Issues, set up in June to examine Bermuda's franchise policy.

The report makes several recommendations including that there is no need to place controls on foreign non-food franchises.

However it recommended that foreign food franchises should be allowed to continue but under a number of controls, which include: A new Franchise Commission to regulate and oversee the operation of franchises.

Giving existing foreign food franchises one year to comply with any new or revised legislation.

A specially designed licensing procedure and the introduction of strict controls on aesthetics, image and appearance.

The controls would include the use of a local trade name and not the name of the foreign franchise, strict controls of signs inside and outside the business and designated restricted and sensitive areas around Bermuda.

Fast-food businesses would be banned from restricted areas which include the Airport, historic sites and environmentally sensitive locations.

Sensitive areas include the City of Hamilton, St. George's, the West End Development Corporation and the Bermuda Land Development Company -- which would have the right to stop them setting up.

The committee recommends that pending new legislation, if a McDonald's set up in Bermuda it should comply with the spirit of the report.

Mr. Dodwell, who chaired the committee, said: "Our goal in this exercise was to find a way to preserve and protect that which makes Bermuda a special place, but at the same time, a way which does not cut Bermuda and Bermudians off from being able to progress.

"This report may not entirely satisfy those with extreme views on either side of the issue, however the committee's recommendations represent a reasonable position which should satisfy the majority.'' The report will now be debated in Cabinet and then Caucus and then the House of Assembly and if accepted new or revised legislation could be introduced based on the recommendations.

However Government backbencher Ann Cartwright DeCouto has insisted she will press ahead with her Prohibited Restaurant Bill -- which will effectively halt any food franchises from setting up.

If her Bill passes before the committee's recommendations are turned into a Bill, the whole report could be wasted.

"I would appeal to Mrs. Cartwright DeCouto that what we have here is a significant report that has gone to the broader community who gave us considerable input,'' said Mr. Dodwell.

"Let's have an opportunity to debate the report. My hope is that there will be some willingness to accept this report, so changing the Prohibited Restaurant Act,'' added the Minister.

The committee's report also confuses the Airport food concession which was awarded to Grape Bay, operating as McDonald's, last week.

It is understood that Transport Minister Wayne Furbert was not aware of the committee's recommendations when he told the House of Assembly that Grape Bay Ltd. had been recommended for the food and beverage concession.

He told the House last week that the lease for the concession would be tabled after MPs had debated the Franchise Committee Report "as the report could necessitate some changes being made to that specific lease''.

Yesterday Mr. Furbert said: "I will take advice from my Cabinet colleagues as well as legal authorities on the issue.'' Last night two of the `People's Five', Dr. Terceira and C.V. Jim Woolridge said they were surprised at the timing of the Airport concessions announcement.

They also said they would discuss strategy on the future of the Prohibited Restaurant Bill -- but added that there was no room for compromise.

"There is a joke somewhere in this report. We predicted that the people on the committee would come up with a whitewash as to how we can dress fast-food franchises up, put them in a little cottage and make it OK,'' said Dr.

Terceira.

Mr. Woolridge added: "When you are digging a hole and you get in over your head stop digging. Time is ticking away towards another general election.'' RESTAURANT EAT