CK Hutchison and its subsidiary, the Panama Ports Company (PPC), are escalating their legal fight against the Panamanian government over the revoked concessions for the Balboa and Cristobal port terminals. PPC has clarified that through its international arbitration filing, it is seeking a minimum of $2 billion in damages.
The dispute intensified after Panama’s Supreme Court ruled Hutchison’s operating contracts unconstitutional. On February 23, the Panamanian government officially seized the two ports.
In a March 6 statement, CK Hutchison accused Panama of executing a “state campaign” over the past year, deliberately ignoring communications and discontinuing consultations. The port operator called the government’s actions “radical breaches” of contract and international treaty rights.
Furthermore, PPC has filed an administrative petition challenging the decree that authorized the port takeover. The company alleges that Panamanian investigators unlawfully entered private storage facilities and seized legally protected documents unrelated to daily port operations. Panamanian officials countered that the search was tied to new information regarding potential crimes, stating they only took control of the equipment necessary to keep the terminals running without claiming ownership of the assets.
Despite the bitter legal battle, cargo continues to flow through the canal’s terminuses. Following the February 23 seizure, Panama immediately signed temporary contracts with major ocean carriers to maintain terminal operations.
According to the Panama Maritime Authority:
- Cristobal: Operations resumed under the management of Terminal Investment Limited (TiL), a division of MSC, on February 27.
- Balboa: Operations returned to 100% capacity under APM Terminals (Maersk) as of February 28.
Looking ahead, Panama plans to hold new port tenders within the next 18 months. To increase regional competition, future operators will be restricted to managing terminals in only one port.