Mr Chin pointed to certain parts of the Offshore Companies Act 1990, now 11 years old, which needed to be amended to make it more "user-friendly".

"The law was adopted 11 years ago while offshore industry is a very dynamic industry... that is why our law must also be able to meet their needs," he told local newspaper the Business Times in an interview. Bringing it up to date would ensure the island's competitiveness over other offshore centres particularly with the rapidly changing landscape of the global offshore industry at the moment.

Mr Chin, who is also the executive chairman of Noblehouse International Trust Sdn Bhd said that one key change would be to simplify the redemption of shares by an offshore company.

The ALTCM has proposed that as long as a company still has net assets after the redemption of the shares, then they should be allowed to do it, whereas at present the redemption of shares has to be made out of profits generated by the company or out of proceeds from a new shares issue.

"These types of things are not good for the fund industry... because funds do not always make profits. In fact they can go down," he said.

Mr Chin added that the Labuan Offshore Securities Industry Act 1998 (Losia) also contains some provisions that are not so friendly to those who want to set up private (mutual) funds as there are many conditions involved.

"What we would like the authority to do is to just to make a single condition that needs to be fulfilled to call yourself a private fund," he said.

Executive director of Insinger Brumby Trust (Labuan) Sdn Bhd Raymond Wong agreed that the legislation need to be constantly updated in line with the technology boom which has brought rapid changes to the offshore industry.

"They can be further improved in the sense that they need to be more focused," he said. But he acknowledged that the Labuan Offshore Financial Services Authority (Lofsa) and Bank Negara Malaysia as the regulatory authorities of Labuan have been very receptive towards ideas and suggestions made by the offshore entities in Labuan, including proposals for changes to legislation.