CK Hutchison vows legal action after Panama Ports taken over by A.P. Moller-Maersk Unit

CK Hutchison said it will pursue legal action over the damage caused by the takeover of two Panama ports previously operated by its subsidiary, the Panama Ports Company. The company warned that if the takeover is enforced, vital systems data and operational information could be removed, forcing the terminals to cease functioning.

The Panama Supreme Court earlier ruled that the concession rights held by CK Hutchison's Panama Ports Company for the two terminals at either end of the Panama Canal were unconstitutional. Days later, the Panama Maritime Authority handed control of both ports to APM Terminals, a unit jointly operated by Denmark-based A.P. Moller-Maersk.

CK Hutchison said it formally notified Maersk that taking over and operating the two ports without CK Hutchison's consent has caused damage to CK Hutchison, Hutchison Ports, and Panama Ports Company, and that it intends to pursue legal action against all parties involved. The company also warned third parties not to collude in any illegal actions related to the operation of the two container terminals.

CK Hutchison added that it has also informed the Republic of Panama of the dispute under applicable investment protection treaties, seeking to safeguard its rights and interests.

According to the concession agreements, the continued operation of the two ports depends entirely on the actions of the Panama Supreme Court and the Panama government. If a formal ruling is issued terminating the concession rights, the terminals' operations would become unlawful and could no longer continue.

Separately, Panama Ports Company has initiated arbitration under the relevant concession contracts and the International Chamber of Commerce rules, urging the Panama government to provide a clear explanation and resolve the dispute through negotiation.

Chief Executive John Lee recently urged the Panama government to respect the spirit of the contracts and provide a fair and just business environment for lawfully operating companies, ensuring their legitimate rights and interests are not interfered with.