III. Specific Reforms

To create a desirable market, which we should strive to do, specific reforms must be implemented regarding products to receive investment, the market to balance demand and supply, intermediaries to provide asset investment transaction services, and administration to guarantee fair, effective, and competitive transactions. Because of the nature of the objectives of reform, such measures will be based upon the following principles.

-- Variety of Choice --

Reforms to expand the possibilities of the market. The expansion of possibilities of the market to answer diversified user needs would improve convenience for market users, thus making the market more profound.

-- Attractive to users --

Reforms to enhance the attraction and competitiveness of the Japanese market and intermediaries through providing innovative products and services that have high added value, or that can minutely and appropriately answer needs of customers. The enhancement of the attractiveness and competitiveness of products and services would make the Japanese market a competitive one which would attract both domestic and overseas users and which would be a worthwhile place of investment.

-- Fair and reliable market --

Reforms to make the principle of self-responsibility followed by every market participant and enhance the reliability of the market under clear and transparent rules. In government administration, the idea that investors should be shielded from risk should be abandoned. Instead, emphasis should be placed upon making the risk involved in investment known to individual investors. The creation of a fair and reliable market would restore people's confidence in securities investment and make securities investment closer to the people.

In view of the above fundamental principles, it seems necessary to consider such matters as transformation of the regulatory framework including the administration, which covers products, the market, and intermediaries. To restore the Japanese securities market in light of the 21st century, it is necessary to tackle these problems in a comprehensive manner. The General Committee, as a matter of course, will further discuss the respective problems. The Committee, at the same time, hopes that other people concerned will also deal spontaneously and positively with them.

Discussion of matters not mentioned here will in no way be excluded. We are ready to accept and discuss other new items, if necessary.

1. Investment products = (offering of attractive investment products)

2. Market = (offering of reliable, effective transaction framework)

3. Market Intermediaries = (offering of a variety of assets management services with high added value)

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