KUALA LUMPUR (Dec 5): Apex Equity Holdings Bhd's second largest shareholder, ACE Group, and its subsidiary Apex Securities Bhd are seeking leave from the High Court to commence judicial review proceedings against the Securities Commission Malaysia (SC) for imposing "additional conditions" in respect of Apex's Capital Markets and Service Licence (CMSL).
According to the application filed on Oct 19, Apex Securities is seeking a declaration that SC's decision to impose the additional conditions pursuant to Section 62 of the Capital Markets and Services Act (CMSA) is null and void.
Apex Securities is also seeking to quash the decision as it claims that the conditions were issued wrongly, irrationally and illegally.
The hearing for the leave application commenced on Monday (Dec 5) at the High Court before judge Datuk Ahmad Kamal Md Shahid.
The SC was represented by Datuk Lim Chee Wee, who objected to the leave application on the grounds that the leave application concerned the issue of jurisdiction.
Apex Securities was represented by Datuk Seri Rajan Navaratnam.
The High Court then fixed Jan 19, 2023 for further submissions and directed the parties to file additional written submissions in the meantime.
This is in relation to the SC taking ACE Group to court to prevent it from taking over the stockbroking firm.
In a filing on Thursday (Dec 1), Apex Equity said the SC was seeking a court declaration that Apex Securities had contravened securities laws, and that ACE Holdings Bhd, which is part of the ACE Group, had been knowingly involved in the contravention.
The SC claimed that Apex Securities contravened the securities laws "as ACE has become a controller of Apex Securities, when ACE is not a fit and proper person" to do so.
The regulator is seeking a court order to refrain ACE from being a controller, not just of Apex Securities, but of any holder of a CMSL. It also wants ACE to remove relevant directors and senior management personnel from Apex Equity and Apex Securities.
ACE Group holds a 14.98% stake in Apex Equity through ACE Credit (M) Sdn Bhd. ACE Group is controlled by Datuk Calvin Choong Chee Meng, who was appointed as managing director of Apex Equity this year.
According to the CMSA, a controller of a CMSL holder controls 15% of the company, or has the power to appoint a majority of the directors of the company, or has the power to effect decisions in the business.
The Edge reported in August that at least three of seven Apex Equity directors at the time were linked to ACE Group, including Choong, Datuk Celine Leong Wai Leng, and Lim Kok Eng.
Of the other four Apex Equity directors not linked to ACE, only three have remained. The fourth — Apex Equity's non-executive chairman Datuk Ahmad Redza Abdullah — resigned on Sept 22, company filings showed.
It was reported that reservations by the SC over ACE stemmed from previous breaches of securities regulations by ACE Holdings, which had led the regulator censuring the company and banning it from fundraising activities.
The SC's writ of summons and statement of claim dated Nov 29 were issued to Apex Equity, Apex Securities and 11 others through law firm Messrs Lim Chee Wee Partnership.
The matter was fixed for case management on Dec 12. Apex Equity said it was seeking legal advice "and will strenuously defend" the case.