Panama Faces $1.5B Claim as CK Hutchison Escalates Port Dispute
Hong Kong conglomerate files second arbitration over cancelled Balboa and Cristobal concessions.
Hong Kong-based CK Hutchison Holdings has launched a second arbitration against Panama, seeking over $1.5 billion in damages for the abrupt cancellation of its port concessions at Balboa and Cristobal.
CK Hutchison alleges that Panama breached an investment protection treaty through a series of state actions targeting its subsidiary’s operations. According to the company, the campaign began in early 2025 and included a “sudden new investigation that lacked due process,” a reversal of legal protections, and what it describes as a “scheme to replace the Panama Ports Company.” The conglomerate’s statement pulls no punches, accusing Panama of attempting to “cover up its conduct through disinformation.”
The original concession, granted in 1997 when Panama took over the canal’s port operations from the U.S., was renewed in 2021 for an additional 25 years. However, the Panama Supreme Court ruled in early 2026 that the enabling laws for the concession were unconstitutional and void. The decision left CK Hutchison’s subsidiary, Panama Ports Company, without legal cover and prompted the government to award temporary contracts to rivals MSC’s Terminal Investments Limited and Maersk’s APM Terminals.
CK Hutchison’s latest arbitration filing argues that Panama failed to engage meaningfully in resolving the dispute. The company claims it issued a supplemental treaty notice and that Panama responded with only “one perfunctory consultation meeting.” No offer of compensation or resolution has been forthcoming, according to the conglomerate, which now frames Panama as a “risky country” for foreign investors, a line that echoes criticisms from the Chinese government.
Beijing has reportedly warned Chinese companies about operating in Panama, and COSCO has suspended some shipping services to the country while increasing inspections of Panama-flagged vessels in Chinese ports.
What’s next for Panama’s ports and the $1.5bn dispute: CK Hutchison
Panama’s government has signalled its intent to retender the Balboa and Cristobal terminals, but with a key change: bidders will be limited to operating only one of the two ports, rather than the single contract that previously covered both. The country is also pushing ahead with plans for competing greenfield terminals at each port, further complicating the landscape for potential investors.
CK Hutchison, meanwhile, is in the process of exiting its international port operations. Bloomberg reports that a sale of the Panama assets was agreed but is now “waiting for clearer political signals” before proceeding. The conglomerate’s decision to file a second arbitration, this time for $1.5 billion, appears calculated to pressure Panama into negotiations.
“Panama has demonstrated that it has become a risky country.”
CK Hutchison Holdings·“Panama has demonstrated that it has become a risky country.”
CK Hutchison Holdings
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