Legislation to update laws to help in the fight against terrorism passed its first hurdle in the House of Keys on Tuesday.

The Customs and Excise Bill was granted a second reading, when the general principle of the legislation is considered.

It aims to update and apply UK and EU legislation to comply with the terms of the Isle of Man’s current customs agreement with the UK and also to allow co-operation with UK agencies in addition to HM Revenue and Customs.

The bill amends the Terrorism and Other Crime (Financial Restrictions) Act, to allow the Treasury to delegate its functions to a body responsible for investigating terrorist-related financial crime, which is not possible under the current wording

It will amend existing law to permit the disclosure of information and documents by Customs and Excise to outside agencies where civil investigations or civil penalties are involved - in addition to criminal investigations - and update the rules to enable the Financial Intelligence Unit to deal with United Nations and European Union sanctions reports from businesses in the same way as it does with suspicious activity reports of money laundering.

It will also require the Treasury to keep records of cash declarations and disclosures and of any seizure of cash and to place an annual report before Tynwald.

Treasury member Ralph Peake (Douglas North) told MHKs the purpose of the bill would ensure ’the continuing relevance and effectiveness’ of laws covered by the Customs and Excise agreement with the UK’.

It also implements some of the recommendations of the Moneyval report on money laundering, so future examination ’produces a favourable result’.