Thailand’s election body said it has decided to seek a court ruling on whether prime ministerial candidate Pita Limjaroenrat should be disqualified after finding that he breached election rules, posing the latest hurdle in the progressive politician’s path to become the nation’s next leader.

“The Election Commission found that Pita Limjaroenrat’s membership in the House of Representatives has grounds to be terminated according to the Thai constitution,” the agency said. “The matter will be submitted to the Constitutional Court for a ruling.”

The poll body is asking the court to rule whether Pita had violated the charter by holding shares in a media company when he applied to run for office as a member of the House. The baht erased an earlier gain to fall as much as 1.1% to 35.15 per dollar.

It was not immediately clear if the Constitutional Court would act on the election body’s request on Wednesday when judges are scheduled to have a weekly meeting. If it does, judges may also decide to suspend Pita’s status as member of parliament while it deliberates on the case. That will scupper his chances of contesting the prime ministerial election scheduled by the parliament for Thursday.

If found guilty by the court, Pita could be disqualified as a lawmaker. He was sworn in only earlier this month after the May 14 election. The parliament’s schedule to hold an election for premier on Thursday won’t be affected by the poll body’s decision, Senator Kamnoon Sidhisamarn told reporters at the parliament house.

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But the legal challenge hanging over Pita makes it increasingly likely that Thursdays’s vote may be postponed, said Punchada Sirivunnabood, an associate professor at Mahidol University.

“The case will have a huge impact,” Punchada said. “The timing of this gives away what it’s meant to achieve. It can also be used an excuse by senators to make a case to delay voting until there is clarity.”

The Election Commission started a probe last month following claims by a political activist that Pita had violated election rules by holding 42,000 shares in now-defunct broadcaster ITV Pcl.

Thailand’s constitution bars lawmakers from owning shares in media firms. Pita has said he didn’t own the shares but managed them as part of an estate left behind by his father. It has since been transferred to a family member, he said.

Pita’s eight-party coalition currently commands a clear majority in the 500-member House of Representatives. But the leader of the Move Forward Party, which is pushing for an amendment to the royal insults law, has struggled to muster enough backing from 250 senators appointed by the pro-royalist, military-backed establishment that will vote alongside the lower chamber.

A drawn-out government formation may also further spook investors. The nation’s benchmark stock index is the worst performer in Asia this year, and the baht is the second-biggest decliner in Southeast Asia since the May 14 vote.

--With assistance from Suttinee Yuvejwattana, Napat Kongsawad, Cecilia Yap and Karl Lester M. Yap.

(Updates with comments from the election commission, a senator and an analyst.)