Li Ka-Shing’s port unit starts arbitration against Panama

[HONG KONG] CK Hutchison Holdings has launched arbitration proceedings against the Republic of Panama after the nation’s Supreme Court ruled that the concession contract for two strategic ports operated by the Hong Kong conglomerate is unconstitutional.

The company, backed by the billionaire Li Ka-shing family, disclosed in a filing strictly before the Hong Kong market opened on Wednesday (Feb 4) that its subsidiary, Hutchison Ports PPC (PPC), initiated the action under the arbitration rules of the International Chamber of Commerce.

The board expressed strong opposition to the judicial ruling, stating it would continue to consult legal counsel and reserve all rights to pursue further domestic and international legal remedies.

The dispute centres on the Cristobal and Balboa ports, located at opposite ends of the Panama Canal. PPC is the only port operator in the country with state participation, as the Panamanian government holds a 10 per cent stake while Hutchison Ports controls the remaining 90 per cent.

The subsidiary originally secured the concession rights in 1997, and the contract was renewed in 2021 for an additional 25-year term.

Following the court’s decision, PPC issued a statement declaring the ruling a violation of the relevant legal framework and the laws that ratified the contract. The company characterised the move as a breach of good faith and the spirit of the agreement, vowing to permanently reserve its rights to seek legal recourse.

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China’s foreign ministry also weighed in on Monday, stating that Beijing will take all necessary measures to resolutely safeguard the legitimate rights and interests of Chinese enterprises.

The Supreme Court’s decision is expected to take effect in early February 2026. In the wake of the ruling and the cancellation of the contract, the Panama Maritime Authority has appointed a subsidiary of AP Moller-Maersk to temporarily manage the Cristobal and Balboa terminals.

The authority described the appointment as part of a “technical operational transition plan” aimed at ensuring uninterrupted port services and supporting global supply chains. CAIXIN GLOBAL