Nasdaq Japan to follow US sibling in listing rules

Nasdaq Japan to follow US sibling in listing rules
Kiyoshi Takenaka

FEBRUARY 23: The Nasdaq Japan stock market will emulate its big brother in the United States in setting listing criteria, paving the way for shares listed on the new market to trade worldwide, founders of the new market said on Wednesday.

The National Association of Securities Dealers (NASD), which created the US Nasdaq market, plans to set up Nasdaq Japan in June as part of its global strategy. "If you have the IPO here in Tokyo, and the company measures up to our standards, global standards, that company not only trade here, it will be reflected on our screens in the United States and reflected in our screens in Europe," NASD chairman Frank Zarb told a new conference.

The June launch of Nasdaq Japan will be followed by the establishment of Nasdaq Europe early next year as part of NASD's plan to eventually offer 24-hour trading in new, fast-growing Asian, European and US companies. NASD has formed a partnership with Internet investor SoftbankCorp to set up the new exchange in Japan.

LISTING CRITERIA: Listing criteria for Nasdaq Japan have been keenly awaited byJapanese entrepreneurs, who want to see on which market they have the best shot of listing shares to raise funds needed for business expansion.

Zarb, along with Softbank president Masayoshi Son and KyojiKitamura, president of the Osaka Securities Exchange (OSE), spoke at the news conference ahead of a meeting later in the day of some 1,400 firms that are interested in listing on Nasdaq Japan.

Nasdaq Japan will be set up as a new section of the OSE. The draft requirements for initial listing and formaintaining a listing were largely in line with existing criteria for the US Nasdaq market. For instance, minimum market capitalisation for the "Growth" section of the planned market is tentatively set at 500 million yen, roughly equivalent to the $5 million threshold for the corresponding section of the U.S. Nasdaq market.

Organisers used an exchange rate of 100 yen to the dollar insetting criteria. The dollar is currently trading at about 110 yen.

SPECIAL INFLUENCE: Asked about concern Softbank may wield special influence inthe marketplace as a co-founder of the new market, Son, the billionaire founder of Softbank, said firms will be screened for listing in a fair, unbiased manner.

Softbank, which has a stake in more than 300 companies around the world, is widely expected to list many group firms on Nasdaq Japan. The announcement last June of plans to set up Nasdaq Japansent a jolt through the nation's securities industry.

The Tokyo Stock Exchange, the nation's largest exchange, reacted by hastily establishing a new market -- called Mothers -- for venture companies last December. Also, the Japan Securities Dealers Association, whichoperates the over-the-counter market, relaxed its listing standards in a effort to attract new venture firms. "Our small initiative has changed the entire Japanese economy," Son said. "Good things are coming to Japan."