-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 DvU5tuLchr+JotfYPTNMmHSjvECxCaC236iiLxSy/7L34tcz4fy6nF2+oXUtbzMJ
 7/l1+TtPqj+2WITnRtD1Mw==

<SEC-DOCUMENT>0000905148-06-004997.txt : 20060726
<SEC-HEADER>0000905148-06-004997.hdr.sgml : 20060726
<ACCEPTANCE-DATETIME>20060726152147
ACCESSION NUMBER:		0000905148-06-004997
CONFORMED SUBMISSION TYPE:	N-Q
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20060531
FILED AS OF DATE:		20060726
DATE AS OF CHANGE:		20060726
EFFECTIVENESS DATE:		20060726

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			JAPAN SMALLER CAPITALIZATION FUND INC
		CENTRAL INDEX KEY:			0000859796
		IRS NUMBER:				133553469
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		N-Q
		SEC ACT:		1940 Act
		SEC FILE NUMBER:	811-05992
		FILM NUMBER:		06981473

	BUSINESS ADDRESS:	
		STREET 1:		2 WORLD FINANCIAL CENTER
		STREET 2:		BUILDING B, 22ND FLOOR
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10281-1712
		BUSINESS PHONE:		8008330018

	MAIL ADDRESS:	
		STREET 1:		2 WORLD FINANCIAL CENTER
		STREET 2:		BUILDING B, 22ND FLOOR
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10281-1712

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	JAPAN OTC EQUITY FUND INC
		DATE OF NAME CHANGE:	19920703
</SEC-HEADER>
<DOCUMENT>
<TYPE>N-Q
<SEQUENCE>1
<FILENAME>efc6-2037_emailformnq.txt
<TEXT>
                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                             Washington, DC 20549

                                   FORM N-Q

            QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
                         MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number:       811-8002
                                      ------------------------

                    JAPAN SMALLER CAPITALIZATION FUND, INC.
   -----------------------------------------------------------------------
              (Exact name of registrant as specified in charter)

                          Two World Financial Center
                            Building B, 22nd Floor
                         New York, New York 10281-1712
   -----------------------------------------------------------------------
                   (Address of principal executive offices)

                               Hiroshi Terasaki
                    Japan Smaller Capitalization Fund, Inc.
                          Two World Financial Center
                            Building B, 22nd Floor
                         New York, New York 10281-1712
   -----------------------------------------------------------------------
                    (Name and address of agent for service)

Registrant's telephone number, including area code: (800) 833-0018
                                                    --------------

Date of fiscal year end:       May 31, 2006
                         ---------------------------

Date of reporting period:      March 1, 2006 - May 31, 2006
                          ----------------------------------------------

Item 1.  Schedule of Investments


<TABLE>
<CAPTION>

                                               JAPAN SMALLER CAPITALIZATION FUND, INC.
                                                       SCHEDULE OF INVESTMENTS
                                                IN SECURITIES OF UNAFFILIATED ISSUERS
                                                            May 31, 2006

                                                                                                                              % of
                                                                                                   Market     Unrealized       Net
                                                                     Shares           Cost          Value      Gain/Loss    Assets
                                                                     ------           ----         ------     ----------    ------
COMMON STOCKS
<S>                                                                          <C>            <C>             <C>               <C>
Automotive Equipment and Parts
Musashi Seimitsu Industry Co., Ltd ....................             122,900     $3,419,183     $3,019,575      ($399,608)      1.0
 Ball joints, camshafts and gears
Nittan Valve Co, Ltd ..................................             371,400      3,115,238      3,478,104        362,866       1.0
                                                                                ----------     ----------       --------       ---
 Engine valves
Total Automotive Equipment and Parts .......................................     6,534,421      6,497,679        (36,742)      2.0
                                                                                ==========     ==========       ========       ===

Banks and Finance
The Bank of Fukuoka, Ltd. .............................             408,000      2,569,215      2,967,339        398,124       1.0
 Deposits, loans and exchange transactions
Iwai Securities Co., Ltd. .............................             195,200      5,317,278      4,265,955     (1,051,323)      1.3
 Financial services
Jaccs Co., Ltd. .......................................             626,000      6,449,160      6,586,834        137,674       2.1
 Consumer credit services
Matsui Securities Co., Ltd. ...........................             344,100      4,746,259      3,767,686       (978,573)      1.2
 Online brokerage services
Sapporo Hokuyo Holdings, Inc. .........................                 367      3,632,434      4,345,128        712,694       1.4
                                                                                ----------     ----------       --------       ---
 General banking services
Total Banks and Finance ....................................................    22,714,346     21,932,942       (781,404)      7.0
                                                                               ===========    ===========      =========       ===

Chemicals and Pharmaceuticals
Shizuokagas Co., Ltd. .................................             721,000      3,870,294      6,180,825      2,310,531       2.0
                                                                                ----------     ----------     ----------       ---
 Natural gas supplier
Total Chemicals and Pharmaceuticals ........................................     3,870,294      6,180,825      2,310,531       2.0
                                                                                ==========     ==========     ==========       ===

Electric
Mirai Industry Co., Ltd. ..............................             274,700      2,672,664      3,386,830        714,166       1.1
                                                                                ----------     ----------       --------       ---
 Plastic molded electric materials
Total Electric .............................................................     2,672,664      3,386,830        714,166       1.1
                                                                                ==========     ==========       ========       ===

Electronics
Dainippon Screen Mfg Co., Ltd. ........................             406,000      2,284,104      3,953,924      1,669,820       1.3
 Electronic components
Meiko Electronics Co., Ltd. ...........................             140,700      5,448,225      8,880,251      3,432,026       2.8
 Printed circuit boards
Sanken Electric Co.,Ltd. ..............................             303,000      4,833,173      4,393,884       (439,289)      1.4
                                                                                ----------     ----------      ---------       ---
  Semiconductors
Total Electronics ..........................................................    12,565,502     17,228,059      4,662,557       5.5
                                                                               ===========    ===========     ==========       ===

Food Manufacturing
Ozeki Co., Ltd. .......................................             123,200      3,722,662      3,816,584         93,922       1.2
                                                                                ----------     ----------        -------       ---
 Supermarket chain
Total Food Manufacturing ...................................................     3,722,662      3,816,584         93,922       1.2
                                                                                ==========     ==========        =======       ===

Information and Software
Jastec Co., Ltd. ......................................             281,000      2,945,922      3,079,281        133,359       1.0
 Applications software
Sorun Corporation .....................................             449,200      3,317,326      3,934,774        617,448       1.2
                                                                                ----------     ----------       --------       ---
 Computer software development
Total Information and Software .............................................     6,263,248      7,014,055        750,807       2.2
                                                                                ==========     ==========       ========       ===

Iron and Steel
Godo Steel Ltd ........................................             539,000      3,440,315      3,224,356       (215,959)      1.0
 Construction steel products
Neturen Co., Ltd. .....................................             275,900      2,359,367      3,043,042        683,675       1.0
                                                                                ----------     ----------       --------       ---
 Metal processors
Total Iron and Steel .......................................................     5,799,682      6,267,398        467,716       2.0
                                                                                ==========     ==========       ========       ===


                                              JAPAN SMALLER CAPITALIZATION FUND, INC.


<PAGE>


                                                       SCHEDULE OF INVESTMENTS
                                                IN SECURITIES OF UNAFFILIATED ISSUERS
                                                            May 31, 2006

                                                                                                                              % of
                                                                                                   Market     Unrealized       Net
                                                                     Shares           Cost          Value      Gain/Loss    Assets
                                                                     ------           ----         ------     ----------    ------
Machinery and Machine Tools
Hitachi Construction Machinery Co., Ltd + .............             395,800     $7,128,915     $9,513,153     $2,384,238       3.0
Construction machinery
Makino Milling Machine Co., Ltd. ......................             966,000      8,838,695     11,712,218      2,873,523       3.7
 Industrial machinery
Sintokogio, Ltd. ......................................             414,000      4,049,346      5,845,053      1,795,707       1.9
 Engineering equipment
Yamatake Corp. ........................................             223,200      5,317,500      5,662,705        345,205       1.8
                                                                                ----------     ----------       --------       ---
 Industrial Automation equipment
Total Machinery and Machine Tools ..........................................    25,334,456     32,733,129      7,398,673      10.4
                                                                               ===========    ===========     ==========      ====

Miscellaneous Manufacturing
Dowa Mining Co., Ltd. .................................             741,000      5,893,805      6,622,727        728,922       2.1
 Produces various metal-related products
Hamamatsu Photonics K.K. ..............................             220,000      5,292,182      7,148,262      1,856,080       2.3
 Electron tubes, semiconductors, and image processors
Kimmon Manufacturing Co. Ltd. .........................           1,186,000      4,081,110      3,146,197       (934,913)      1.0
 Produces various electronic measurement equipments
Mani, Inc. ............................................              80,100      1,994,046      6,060,889      4,066,843       1.9
 Medical goods and equipment
Nichias Corporation ...................................             720,000      3,880,584      5,210,843      1,330,259       1.7
 Building and construction materials
Nichiha Corporation ...................................             215,600      3,382,853      4,452,682      1,069,829       1.4
 Ceramic exterior walls and fiber boards
Seiko Corp. ...........................................             426,000      2,725,197      3,978,048      1,252,851       1.3
 Medical and commercial equipment
Topcon Corporation ....................................             301,600      3,858,391      6,376,463      2,518,072       2.0
 Medical instruments
Toppan Forms Co.,Ltd. .................................             224,700      3,235,906      3,144,420        (91,486)      1.0
 Commercial printing
Ulvac, Inc. ...........................................              77,300      3,012,643      3,302,978        290,335       1.1
                                                                                ----------     ----------       --------       ---
  Vaccuum devices
Total Miscellaneous Manufacturing ..........................................    37,356,717     49,443,509     12,086,792      15.8
                                                                               ===========    ===========    ===========      ====

Real Estate and Warehouse
Daibiru Corporation ...................................             423,800      3,544,150      4,715,805      1,171,655       1.5
 Leases office buildings, apartments and hotels
Leopalace21 Corporation ...............................             100,900      3,483,137      3,017,973       (465,164)      1.0
 Property manager
Suruga Corporation ....................................              45,400      2,839,369      2,990,697        151,328       1.0
                                                                                ----------     ----------       --------       ---
 Multi-unit commercial and residential building
Total Real Estate and Warehouse ............................................     9,866,656     10,724,475        857,819       3.5
                                                                                ==========    ===========       ========       ===

Restaurants
Doutor Coffee Co., Ltd. ...............................             260,000      5,082,643      4,453,109       (629,534)      1.4
                                                                                ----------     ----------      ---------       ---
 Coffee shop chains
Total Restaurants ..........................................................     5,082,643      4,453,109       (629,534)      1.4
                                                                                ==========     ==========      =========       ===

Retail
Askul Corp. ...........................................             156,000      4,574,005      4,034,183       (539,822)      1.3
 Office equipment products
Culture Convenience Club Co., Ltd. ....................             343,800      3,620,923      4,177,567        556,644       1.3
 Speciality bookstore
Village Vanguard Co., Ltd. ............................                 522      2,745,331      4,019,495      1,274,164       1.3
                                                                                ----------     ----------     ----------       ---
 Books, cd's, videos and office supplies
Total Retail ...............................................................    10,940,259     12,231,245      1,290,986       3.9
                                                                               ===========    ===========     ==========       ===


<PAGE>


                                               JAPAN SMALLER CAPITALIZATION FUND, INC.
                                                       SCHEDULE OF INVESTMENTS
                                                IN SECURITIES OF UNAFFILIATED ISSUERS
                                                            May 31, 2006

                                                                                                                              % of
                                                                                                   Market     Unrealized       Net
                                                                     Shares           Cost          Value      Gain/Loss    Assets
                                                                     ------           ----         ------     ----------    ------
Services
DTS Corporation .......................................             112,900     $3,871,678     $3,859,314       ($12,364)      1.2
 System and network engineering
Meiko Network Japan Co., Ltd. .........................             589,100      3,280,998      3,151,726       (129,272)      1.0
                                                                                ----------     ----------      ---------       ---
 Private schools and academic tutoring
Total Services .............................................................     7,152,676      7,011,040       (141,636)      2.2
                                                                                ==========     ==========      =========       ===

Telecommunications
Daimei Telecom Engineering Corp. ......................             383,000      3,916,318      4,739,129        822,811       1.5
                                                                                ----------     ----------       --------       ---
 Telecommunication wire installations
Total Telecommunications ...................................................     3,916,318      4,739,129        822,811       1.5
                                                                                ==========     ==========       ========       ===

Textiles and Apparel
Workman Co., Ltd. .....................................              80,700      1,598,227      3,067,512      1,469,285       1.0
                                                                                ----------     ----------     ----------       ---
 Uniforms
Total Textiles and Apparel                                                       1,598,227      3,067,512      1,469,285       1.0
 ...........................................................................    ==========     ==========     ==========       ===

Wholesale
Hitachi High-Technologies Corporation .................             212,500      4,288,552      6,091,156      1,802,604       1.9
 Computers and electrical devices
Kondotec, Inc. ........................................             251,500      1,986,800      3,235,123      1,248,323       1.0
 Construction materials
Yuasa Trading Co., Ltd. ...............................           3,503,000      7,181,256      7,359,309        178,053       2.3
                                                                                ----------     ----------       --------       ---
 Industrial machinery
Total Wholesale ............................................................    13,456,608     16,685,588      3,228,980       5.2
                                                                               ===========    ===========     ==========       ===

TOTAL INVESTMENTS IN COMMON STOCKS .........................................  $178,847,379   $213,413,108    $34,565,729      67.9
                                                                             =============  =============   ============      ====

</TABLE>


<PAGE>


<TABLE>
<CAPTION>
                                               JAPAN SMALLER CAPITALIZATION FUND, INC.
                                                       SCHEDULE OF INVESTMENTS
                                                IN SECURITIES OF UNAFFILIATED ISSUERS
                                                            May 31, 2006

                                                                                                                              % of
                                                                      Principal                       Market    Unrealized     Net
                                                                         Amount          Cost          Value  Gain or Loss  Assets
                                                                         ------          ----          -----  ------------  ------
INVESTMENTS IN FOREIGN CURRENCY
<S>                                                             <C>             <C>            <C>            <C>            <C>
Hong Kong Shanghai Bank- Tokyo
  Non- interest bearing account ................................JPY 365,192,983    $3,250,928     $3,250,928            $0     1.0
                                                                                  -----------    -----------           ---     ---
TOTAL INVESTMENTS IN FOREIGN CURRENCY ...................................           3,250,928      3,250,928             0     1.0
                                                                                   ----------     ----------            --     ---

TOTAL INVESTMENTS .......................................................        $182,098,307   $216,664,036   $34,565,729    68.9
                                                                                -------------  -------------  ------------    ----

OTHER ASSETS LESS LIABILITIES, NET .........................................................     $97,240,610                  31.1
                                                                                                ------------                  ----

NET ASSETS .................................................................................    $313,904,646                 100.0
                                                                                               =============                 =====

</TABLE>

+ Non-Income Producing Security
* Aggregate gross unrealized appreciation for all securities in which there is
  an exceed of value over tax cost was $40,453,036.
  Aggregate gross unrealized depreciation for all securities in which there is
  an excess of tax cost over value was $5,887,307.


      Portfolio securities and foreign currency holdings were translated
              at the following exchange rate as of May 31, 2006.

                                 Japanese Yen        112.34     =$1.00


<PAGE>

Item 2.  Controls and Procedures.

(a) The Registrant's Principal Executive Officer and Principal Financial
Officer evaluated the Registrant's disclosure controls and procedures within
90 days of the filing of this report and concluded that they were effective in
providing reasonable assurance that the information required to be disclosed
by the Registrant in its reports or statements filed under the 1934 Act is
recorded, processed, summarized and reported within the time periods specified
in the rules and forms of the Securities and Exchange Commission.

<PAGE>

(b) There were no changes in the Registrant's internal control over financial
reporting that occurred during the Registrant's last fiscal quarter that have
materially affected, or are reasonably likely to materially affect, the
Registrant's internal control over financial reporting.

Item 3.  Exhibits.

(a) Certifications of Principal Executive Officer and Principal Financial
Officer pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 are
attached hereto as an exhibit.

<PAGE>

                                  SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

JAPAN SMALLER CAPITALIZATION FUND, INC.



By: /s/ Hiroshi Terasaki
    -------------------------------
    Hiroshi Terasaki, President
    (Principal Executive Officer)

Date:  July 26, 2006


Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
dates indicated.




By: /s/ Rita Chopra-Brathwaite
    -----------------------------------
    Rita Chopra-Brathwaite, Treasurer
    (Principal Financial Officer)

Date:  July 26, 2006
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.CERT
<SEQUENCE>2
<FILENAME>efc6-2037_5667143ex99acert.txt
<TEXT>
                                                              Exhibit.CERT

                    Japan Smaller Capitalization Fund, Inc.

       Two World Financial Center, Building B, New York, N.Y. 10281-1712

                                                             Telephone
                                                                (800) 833-0018
                     CERTIFICATION PURSUANT TO SECTION 302
                       OF THE SARBANES-OXLEY ACT OF 2002


I, Rita Chopra-Brathwaite, certify that:

1.  I have reviewed this report on Form N-Q of Japan Smaller Capitalization
    Fund, Inc. (the "registrant");

2.  Based on my knowledge, this report does not contain any untrue statement
    of a material fact or omit to state a material fact necessary to make the
    statements made, in light of the circumstances under which such statements
    were made, not misleading with respect to the period covered by this
    report;

3.  Based on my knowledge, the schedule of investments in this report fairly
    presents in all material respects the investments of the registrant as of
    the end of the fiscal quarter for which the report is filed;

4.  The registrant's other certifying officer(s) and I are responsible for
    establishing and maintaining disclosure controls and procedures (as
    defined in Rule 30a-3(c) under the Investment Company Act of 1940) and
    internal control over financial reporting (as defined in Rule 30a-3(d)
    under the Investment Company Act of 1940)for the registrant and have:

    (a) Designed such disclosure controls and procedures, or caused such
        disclosure controls and procedures to be designed under our
        supervision, to ensure that material information relating to the
        registrant, including its consolidated subsidiaries, is made known to
        us by others within those entities, particularly during the period in
        which this report is being prepared;

    (b) Designed such internal control over financial reporting, or caused
        such internal control over financial reporting to be designed under
        our supervision, to provide reasonable assurance regarding the
        reliability of financial reporting and the preparation of financial
        statements for external purposes in accordance with generally accepted
        accounting principles;

    (c) Evaluated the effectiveness of the registrant's disclosure controls
        and procedures and presented in this report our conclusions about the
        effectiveness of the disclosure controls and procedures, as of a date
        within 90 days prior to the filing date of this report, based on such
        evaluation; and


<PAGE>


    (d) Disclosed in this report any change in the registrant's internal
        control over financial reporting that occurred during the registrant's
        most recent fiscal quarter that has materially affected, or is
        reasonably likely to materially affect, the registrant's internal
        control over financial reporting; and

5.  The registrant's other certifying officer(s) and I have disclosed to the
    registrant's auditors and the audit committee of the registrant's board of
    directors (or persons performing the equivalent functions):

    (a) All significant deficiencies and material weaknesses in the design or
        operation of internal control over financial reporting which are
        reasonably likely to adversely affect the registrant's ability to
        record, process, summarize, and report financial information; and

    (b) Any fraud, whether or not material, that involves management or other
        employees who have a significant role in the registrant's internal
        control over financial reporting.


    Date: July 26, 2006
                                                /s/ Rita Chopra-Brathwaite
                                                --------------------------
                                                Rita Chopra-Brathwaite
                                                Treasurer



<PAGE>


                    Japan Smaller Capitalization Fund, Inc.

       Two World Financial Center, Building B, New York, N.Y. 10281-1712

                                                             Telephone
                                                                (800) 833-0018
                     CERTIFICATION PURSUANT TO SECTION 302
                       OF THE SARBANES-OXLEY ACT OF 2002


I, Hiroshi Terasaki, certify that:

1.  I have reviewed this report on Form N-Q of Japan Smaller Capitalization
    Fund, Inc. (the "registrant");

2.  Based on my knowledge, this report does not contain any untrue statement
    of a material fact or omit to state a material fact necessary to make the
    statements made, in light of the circumstances under which such statements
    were made, not misleading with respect to the period covered by this
    report;

3.  Based on my knowledge, the schedule of investments in this report fairly
    presents in all material respects the investments of the registrant as of
    the end of the fiscal quarter for which the report is filed;

4.  The registrant's other certifying officer(s) and I are responsible for
    establishing and maintaining disclosure controls and procedures (as
    defined in Rule 30a-3(c) under the Investment Company Act of 1940) and
    internal control over financial reporting (as defined in Rule 30a-3(d)
    under the Investment Company Act of 1940)for the registrant and have:

    (a) Designed such disclosure controls and procedures, or caused such
        disclosure controls and procedures to be designed under our
        supervision, to ensure that material information relating to the
        registrant, including its consolidated subsidiaries, is made known to
        us by others within those entities, particularly during the period in
        which this report is being prepared;

    (b) Designed such internal control over financial reporting, or caused
        such internal control over financial reporting to be designed under
        our supervision, to provide reasonable assurance regarding the
        reliability of financial reporting and the preparation of financial
        statements for external purposes in accordance with generally accepted
        accounting principles;

    (c) Evaluated the effectiveness of the registrant's disclosure controls
        and procedures and presented in this report our conclusions about the
        effectiveness of the disclosure controls and procedures, as of a date
        within 90 days prior to the filing date of this report, based on such
        evaluation; and


<PAGE>


    (d) Disclosed in this report any change in the registrant's internal
        control over financial reporting that occurred during the registrant's
        most recent fiscal quarter that has materially affected, or is
        reasonably likely to materially affect, the registrant's internal
        control over financial reporting; and

5.  The registrant's other certifying officer(s) and I have disclosed to the
    registrant's auditors and the audit committee of the registrant's board of
    directors (or persons performing the equivalent functions):

    (a) All significant deficiencies and material weaknesses in the design or
        operation of internal control over financial reporting which are
        reasonably likely to adversely affect the registrant's ability to
        record, process, summarize, and report financial information; and

    (b) Any fraud, whether or not material, that involves management or other
        employees who have a significant role in the registrant's internal
        control over financial reporting.


    Date: July 26, 2006                         /s/ Hiroshi Terasaki
                                                --------------------
                                                Hiroshi Terasaki
                                                President


</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
