CK Hutchison initiates arbitration against Panama
Panama Ports Company S.A. (PPC), a subsidiary of CK Hutchison, initiated arbitration proceedings against the Republic of Panama on February 3, 2026. The filing, made under the terms of the applicable concession contract and the Rules of Arbitration of the International Chamber of Commerce, follows PPC’s assertion of a year-long campaign by the Panamanian state that specifically targeted the company and its concession agreement, while other port sector contracts remained unaffected. PPC contends that recent actions taken by the state constitute serious and imminent harm to its operations.
PPC stated that extensive efforts were made throughout the past year to engage in consultations with state authorities and to avert arbitration. While continuing to operate the ports and cooperate with the government, the company repeatedly communicated its concerns and sought clarification. However, these formal requests were reportedly disregarded.
The arbitration is rooted in the concession contract and the legal framework established nearly three decades ago, which PPC views as providing long-term legal certainty. The company alleges that Panama has violated both the concession contract and applicable law, and is seeking substantial damages, calculated based on financial assessments, along with other necessary remedies. PPC and its investors explicitly reserve all their rights.
In the context of this dispute, PPC references a judicial press statement issued on January 29, 2026, concerning a Supreme Court ruling that declared Law No. 5 of January 16, 1997, unconstitutional, along with other related legal instruments. PPC notes that this ruling has not yet been officially published or enacted and contradicts prior Supreme Court decisions on similar contracts.
Subsequent to this press statement, the Panamanian State reportedly began taking steps to assume control of PPC’s operations. These actions included site inspections and demands for unrestricted access to PPC’s facilities, commercial and intellectual property, information, and employees. These measures appear linked to the unpublished court ruling and a port transition plan coordinated among state authorities. PPC has maintained its management of port operations and continued engagement with government representatives, while simultaneously requesting access to the transition plan and opportunities for consultation.
PPC emphasized that under the ownership of CK Hutchison, significant investments have been channeled into infrastructure, technology, and workforce development, creating thousands of direct and indirect jobs and bolstering Panama’s position as a global port and logistics hub.
Despite commencing arbitration, PPC reaffirms its commitment to seeking clarity and dialogue with the Panamanian State to achieve a resolution to this dispute.