Listing

- FONT SIZE
JAPANESE

1. Benefits of going public

From the point of view of the protection of public investors, a public company must meet certain legal and social obligations and responsibilities, such as periodic reporting, timely and accurately disclosure, and engagement in investor relations activities. However, a company can generally benefit by listing as outlined below.

（1）Increase in opportunities to access to public funds: Listing gives a company greater access to public funds in the primary market because the exchange secures liquidity of securities trading, and a liquidity provision function that the exchange can intrinsically control. Through listing, a company will have the strong option to finance by public offering and distribution, and will be able to improve and strengthen its financial structure.

（2）Improvement of internal control: Listing means disclosure of corporate information and thus a company must expose itself to public investors. This exposure will create the opportunity to develop credible internal control.

（3）Enhancement of credibility, prestige and public profile: Going public gives a company improved credibility, a high public profile and prestige as a result of exposure in the mass media.

（4）Improvement in employee morale and attraction of quality potential candidates: From a human resources aspect, going public can improve morale of employees. In addition, a listed company is more able to attract quality potential candidates thanks to heightened public recognition.

2. Two cash equity markets in FSE

After passing a criteria test, FSE conducts a review to determine whether the applicant company is eligible for FSE listing. In the process of the review, checks carried out by FSE include those for "timely and accurate disclosure" and "fair and faithful management." If after the due diligence process, the applicant is determined to be eligible, FSE will approve the application for listing.

FSE is comprised mainly of two cash equity markets: the Main Board and Q-Board.

Main Board

Market for companies which have stable and growing businesses with consistent financial track records. Founded July 1949.

Q-Board

Market for companies which have promising and unique businesses, especially regional small and medium companies. Founded May 2000.

For more information on listing criteria and eligibility requirements,click here

3. Listing procedures

Preparation of listing application: At an early stage in the IPO process, an applicant starts its listing preparation by preparing for the maintenance of management matters required by the exchange for listed companies, such as "development of a robust revenue base" and "reinforcement of internal control." An underwriting securities company and auditing firm usually lead the overall application although the applicant should carry out preparations on its own initiative. The applicant may consult with the FSE Foreign Stock IPO Promotion Office prior to application concerning interpretation of FSE criteria and preparation of the application documents.

Application: After completing the preparation process, the applicant submits documents required by FSE for the review process.
Please be advised that the applicant decides the date of submission of the application documents with the mutual consent of the underwriting securities company after it has established a schedule with FSE.
At the time of application, the applicant briefly explains to FSE the substance of its business and future prospects for the company.

Review process

a. Review based on listing application documents: FSE reviews and examines the listing application documents, and gains an understanding of the company overall, which will include corporate history, substance of business, track record, market trends and positioning.
b. Preparation of written response to written inquiries from FSE: FSE sends written questions to the applicant about its listing application. The applicant then prepares and submits written responses to the questions.
c. FSE IPO officer hearing with applicant company: FSE IPO officers conduct a hearing with the applicant on the submitted written responses.
d. FSE on-site investigation: FSE visits headquarters, customer offices and plants of the applicant to confirm whether it has properly implemented an internal control system and accounting procedures.
e. FSE hearing with applicant's auditing officers: FSE conducts a hearing with auditing officers on the applicant's state of affairs.
f. FSE hearing with applicant's auditing firm: FSE conducts a hearing with the applicant's auditing firm on the internal control system and disclosure of information.
g. FSE hearing with applicant executives: FSE executives conduct a hearing with the directors of the applicant on the future prospects of the business.

Approval of listing: FSE closes its review procedures after approval of the listing application, and notifies the applicant that FSE has approved the listing application. FSE also makes a public announcement on the approval of the listing application.

Execution of public offering and distribution: For the applicant to carry out a public offering or distribution of its equity, it takes about a month from the day listing was approved to the day of actual listing.
During this one-month period, FSE examines whether the financing meets distribution criteria.

Listing ceremony: On the day of listing, FSE holds a listing ceremony with the participation of the securities company, auditing firm, and other related organizations to celebrate the new listing, and presents a notice of listing approval and a commemorative plaque to the newly listed company.