Hong Kong's CK Hutchison Holdings has escalated its dispute with Panama, formally notifying the government of a treaty dispute after authorities moved to replace the company at two key Panama Canal ports just days after the country's Supreme Court ruled the legal basis for its long‑standing concession unconstitutional.
The company said it initiated the treaty process "to protect its rights and interests" and has invited consultations with Panama over "measures taken by the Panamanian State that have impacted CKHH and Panama Ports Company S.A. (PPC)," according to a statement issued on Feb. 12.
The warning comes amid a rapidly intensifying conflic over the Balboa and Cristóbal terminals, operated by Hutchison's subsidiary PPC. .
Panama's Supreme Court announced on January 29 that Law No. 5 of 1997, the legal foundation for PPC's nearly three‑decade concession at the Balboa and Cristóbal terminals, is unconstitutional, finding that the laws underpinning the agreements violated the country's constitution and public‑interest requirements.
CK Hutchison said it considers any determination that Law No. 5 is unconstitutional "to be unlawful," noting that the ruling has not yet been published or entered into force.
Despite this, the company said Panama has already taken steps "toward a forced exit of PPC and transition of the port sector, with no clarity as to operational plans."
Panamanian authorities has also tapped a Danish logistics and ports operator to temporarily take over the facilities — prompting CK Hutchison to accuse the government of orchestrating a campaign against its operations and to signal that it would pursue legal remedies.
APM Terminals drawn into dispute
Panama's Maritime Authority announced on January 30 that it would rely on APM Terminals, part of A.P. Moller–Maersk, as temporary administrator of the Balboa and Cristóbal terminals during a transition period. APM Terminals confirmed the same day that it was willing to assume temporary operations "to mitigate any risks that could impact essential services for regional and global trade and provide support to Panama's logistics hub."
APM Terminals also emphasized that the company is "not involved in the ongoing legal proceedings and bears no role in decisions regarding the short- or long-term structure or future administration of Balboa and Cristobal terminals."
Meanwhile, Hutchison Port Holdings later cautioned Maersk that any move by APM Terminals or its affiliates to assume control of the Balboa or Cristóbal facilities without its consent would expose them to potential damages and legal action.
"On February 10, 2026, Hutchison Port Holdings Limited (HPH) notified A.P. Moller – Maersk A/S that any steps by APMT or any of its affiliates to assume the administration or operation of PPC's ports at Balboa or Cristobal in any capacity for any period of time without the agreement of CKHH will cause damages to CKHH, HPH and PPC and result in legal recourse against APMT and/or its affiliates involved," the global port operator said.
PPC separately confirmed that it initiated arbitration proceedings against the Republic of Panama on February 3, 2026, under the terms of its concession contract and the Rules of Arbitration of the International Chamber of Commerce. The company said Panama had breached its contractual obligations and that it would seek extensive damages.
CK Hutchison said it will continue consulting legal counsel on "all available recourse including additional national and international legal proceedings" against Panama and any third parties "colluding with them in this matter."
The dispute centers on two of the most strategically important container terminals in the Americas — situated at the Pacific and Atlantic entrances of the Panama Canal.
The Supreme Court's decision has cast uncertainty over the future of the concessions and has also complicated CK Hutchison's broader port‑sector plans, including a proposed multibillion‑dollar global port sale.
Operations at risk
CK Hutchison said the Panamanian State has provided "no assurances or clarity" regarding PPC's continued operations and is "pushing toward a forced stoppage or takeover," creating further disruption.
The company warned that if the Supreme Court ruling is published and results in termination of the concession, "the immediate result would be to render PPC’s operation of its terminals… impossible."
The company added that ongoing operations "depend solely on actions of the Panama Supreme Court and the Panamanian State," which are "wholly outside the control of CKHH, HPH and PPC."
Despite the dispute, CK Hutchison said PPC remains committed to protecting employees, avoiding operational disruptions, and supporting vessel and cargo flows through the Panama Canal "provided that the actions of the Panama Supreme Court and the Panamanian State permit."
Panama has earlier rejected accusations of political targeting, while China's Foreign Ministry has publicly urged Panama to protect the rights of Chinese companies operating in the country.