Ramesh Rajaratnam, an accountant, said Section 188(2)(a) is discriminatory and contravenes Article 8 of the Federal Constitution.
He said the provision does not distinguish between a director who trades in shares armed with information that is not generally available, and one who trades in compliance with Chapter 14 of Bursa Malaysia’s Listing Requirements which governs dealing in listed securities.
Ramesh said his exposure to prosecution under CMSA despite due compliance with the listing requirements is tantamount to a violation of his constitutional right to trade, a personal liberty under Article 5.
In the originating summons filed at the High Court here by solicitors Srimurugan & Co earlier, Ramesh named the Securities Commission and the government as defendants.
He said Section 188(2) also violated his rights to freedom of association and to property.
Ramesh, who wants the court to strike down the provision as null, void and unenforceable, is also seeking other relief deemed fit by the court, and costs.
On May 6, the Court of Appeal overturned a High Court decision handed down three years earlier acquitting Ramesh – also a former Malaysian Merchant Marine Bhd (MMM) executive deputy chairman – of insider trading.
A three-member bench comprising Justices Vazeer Alam Mydin Meera, Ahmad Zaidi Ibrahim and Wong Kian Kheong ruled that the lower court was wrong to acquit Ramesh without considering the merits of the case.
It reinstated the conviction and sentence handed down by the sessions court previously.
The Court of Appeal further directed that the appeal be remitted to the High Court and heard on its merits before a different judge.
Ramesh was charged in April 2015 with disposing of five million MMM shares in January 2010 while possessing inside information on Malaysian Rating Corporation Bhd’s plan to downgrade the firm’s credit rating.
He was also charged with disposing of 5.2 million MMM shares on two occasions a month later while possessing inside information involving MMM’s classification as a PN17 company.
He was convicted by the Kuala Lumpur sessions court on all three charges in September 2019 following a full trial.
He was sentenced by the trial court to five years in prison and a RM3 million fine for each charge, with each sentence to be served concurrently.