Hong Kong conglomerate CK Hutchison Holdings has launched fresh arbitration proceedings against Panama, seeking more than $1.5 billion in damages over the government’s takeover of two key ports serving the Panama Canal.
The company said Thursday that Panama had breached an investment protection treaty through what it described as “sovereign acts” targeting its decades-old concession to operate the Balboa and Cristobal ports.
Panama took control of the two ports in February after the country’s Supreme Court ruled that a concession held by CK Hutchison’s subsidiary, Panama Ports Company, was unconstitutional.
The ports, located at opposite ends of the Panama Canal, have become a focal point in rising tensions between the United States and China. U.S. President Donald Trump has repeatedly raised concerns over China’s influence around the strategically important waterway.
The Panama Canal itself is owned and managed by Panama. However, Panama Ports Company had operated the Balboa and Cristobal facilities since 1997, with its concession renewed for another 25 years in 2021.
The takeover drew criticism from Beijing and Hong Kong authorities, while CK Hutchison said the latest arbitration was focused specifically on its treaty rights and was separate from an earlier case concerning the company’s contractual rights.
CK Hutchison, controlled by the family of Hong Kong billionaire Li Ka-shing, had also announced a $23 billion deal last year to sell its global ports business, including the two Panama facilities, to a consortium involving U.S. investment firm BlackRock. The transaction has since faced geopolitical and legal obstacles.
In March, Panama Ports Company separately began arbitration proceedings seeking at least $2 billion in compensation, arguing that Panama’s takeover of the ports was unlawful. CK Hutchison said those proceedings were making progress.
The company also launched separate arbitration proceedings in April against Danish shipping and logistics giant Maersk after the company took over some port operations in Panama. Maersk has rejected liability for the claims.
