The IPO process is very convoluted, although it no longer takes two or three years. Few analysts expect all to survive independently, and the Mothers market has already fallen out of favour. The exchange was hoping to attract over 30 stocks by mid-2000 it has 10, and more than half were trading below their IPO price at the time of going to press. The global downturn is partly to blame, but investors are also pointing fingers at lax disclosure rules. The hope is that Nasdaq Japan s more stringent disclosure requirements will restore confidence and spur rival markets to raise standards.
Liquidity is a major problem.
This means that stock splits can t be done easily, the number of shares outstanding remains small, and shares often carry startlingly high price tags. Communication infrastructure is another area that needs revamping. The US is at less than half that. The US has argued that the company s high charges impede competition and Internet usage. A frequent complaint among entrepreneurs is that Japan s historical and cultural legacy is resistant to change.