Panama revokes CK Hutchison concession, Maersk–MSC takes over

JAKARTA – The Panamanian government has officially terminated the port concession contract held by a CK Hutchison subsidiary near the Panama Canal, paving the way for Maersk and Mediterranean Shipping Company (MSC) to take over operations on a temporary basis.

A ruling by Panama’s Supreme Court, published in the country’s official gazette, annulled the concession for the Balboa and Cristobal terminals, which had been managed for nearly 30 years by Panama Ports Company, a CK Hutchison unit. With the publication, the cancellation is now legally in effect.

According to Reuters, the Panama Maritime Authority (AMP) immediately assumed control of both ports through a decree to ensure operational continuity.

The government then approved two temporary concession contracts lasting up to 18 months. APM Terminals Panama, a Maersk subsidiary, will operate the Port of Balboa, while TIL Panama, affiliated with MSC, will manage the Cristobal Terminal.

This move could disrupt CK Hutchison’s plan to sell its global port assets, valued at US$23 billion, to a consortium led by BlackRock alongside MSC, which includes assets in Panama.

Previously, CK Hutchison stated it would pursue international arbitration to challenge the ruling and had notified the Panamanian government of a dispute under investment protection agreements.

The company stressed that any takeover without consent could trigger legal action against APM Terminals Panama.

The court decision, issued at the end of January, comes amid rising trade rivalry between the United States and China.

US President Donald Trump has pushed for limiting China’s influence over the Panama Canal, a route that handles around 5% of global maritime trade.

Panamanian President Jose Raul Mulino emphasised that the temporary contracts do not amount to nationalisation, but are a lawful measure to ensure continued operations until asset valuations are completed and a more competitive concession framework is prepared.

He also assured that port operations and workers would not be affected during the transition period. (DK/LM)