Outside it is a bright, warm summer's day and the narrow streets of Prague are thronged with tourists. Inside the faceless municipal building that houses the new Czech Securities Commission (CSC) the light is thick and gloomy and there is an almost unnatural quiet. It may reveal a sense of anticipation. Equally, it could be foreboding.
The effort to clean up the financial system is long overdue. For years the Czech Republic has taken the idea of a free market a little too literally. "Previously there was no will to enforce the law," says Jan Müller, the head of the new CSC. "It was part of the general policy, the policy of total freedom."
That policy has been accompanied by a dramatic decline in the relative importance of the Czech equity market compared with its rivals. In 1995 the market capitalization of the Czech market was over four times that of Poland, and seven times that of Hungary. By 1997 it had been overtaken by Hungary and it looks set to be surpassed by Poland in 1998.
International portfolio investors discovered that doing business in the Czech Republic was often more trouble than it was worth.