Mr Finucane, 39, was shot dead in front of his family
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The family of murdered solicitor Pat Finucane have said they cannot take part in any inquiry into his murder under the terms set out in legislation published on Friday.
They said the Inquiries Bill did not comply with recommendations set out by the Canadian Judge Peter Cory who investigated the case.
In a statement, the Finucane family said they were concerned about the independence and the powers which the inquiry would have.
"Judge Cory recommended a public inquiry into the circumstances surrounding Pat's murder and identified the 'basic requirements' for a public inquiry," said the family.
"One of these requirements was stated to be that 'the tribunal should have full power to subpoena witnesses and documents
together with all the powers usually exercised by a Commissioner in a public inquiry'.
"Clause 17 of the bill is a wholesale departure from the Weston Park Agreement and the Cory Recommendation in that an inquiry established under this draft legislation will not have all the powers usually exercised by a Commissioner in a public inquiry since, it gives the Minister the power to determine when the inquiry sits in private and what material is to be withheld.
"These are self-evidently amongst the most important powers exercised by inquiries," said the Finucane family.
It added: "In addition, and in order to be truly independent, the tribunal will have to be international in character and be composed of judges of standing equivalent to Judge Cory.
"The Finucane family cannot take part in any inquiry established under these conditions."
'Controversial killings'
However, the Northern Ireland Office said the Finucane inquiry would have full powers to compel witnesses and the disclosure of documents.
Responding to the Finucane family's criticism of new legislation, the NIO said nothing would be withheld from the inquiry into Pat Finucane's murder.
"The government wants the inquiry to be able to get at the full facts of what happened," said an NIO spokesperson.
However, because of national security, a large proportion of evidence would "have to be considered in private".
Announcing an inquiry into the solicitor's murder in September, Secretary of State Paul Murphy insisted it would not be a "cover-up".
Mr Finucane, 39, was shot dead in front of his family at his north Belfast home by the loyalist Ulster Defence Association.
The killing was one of the most controversial of the 30 years of the Troubles in Northern Ireland, mainly because of the allegations of collusion between loyalist paramilitaries and members of the security forces.
Retired Canadian Judge Peter Cory was appointed by the British and Irish Governments to examine allegations of collusion surrounding the Finucane and other controversial killings.
He recommended a public inquiry into Mr Finucane's death.
Loyalist Ken Barrett, 41, was sentenced in September to life for Mr Finucane's murder, after admitting his part in the killing.