CK Hutchison Holdings Limited has escalated its legal actions against the Panamanian State, challenging the seizure of assets and documents of its subsidiary Panama Ports Company (PPC), and qualifying the actions of the Panamanian government as "illegal."
Panamanian authorities took physical, administrative, and operational control of the two ports on February 23, following the annulment by the government of the 25-year extension of the concession that PPC held over both terminals. The ports now operate under temporary concessions granted to APM Terminals and Terminal Investment Limited (TIL), the investment arm in terminals of MSC.
CK Hutchison Holdings has submitted a supplement to its previous dispute notification against the Panamanian State under an investment treaty that provides for international arbitration, after what the company describes as a continued breakdown in communications with the authorities. "The State has maintained a pattern of ignoring communications and discontinuing consultations," the company pointed out, adding that the authorities had "occupied the ports and taken the property and personnel" of PPC "without transparency." CK Hutchison also noted having detected "inaccurate statements" from the State, which it believes have "further exacerbated the circumstances."
In parallel, PPC has submitted an administrative petition requesting reconsideration of Executive Decree number 23, which led to the occupation of the facilities and the confiscation of assets. The subsidiary is also challenging the alleged seizure of documents belonging to it. These actions add to a previous arbitration demand submitted under the rules of the International Chamber of Commerce.
CK Hutchison has stated that it "does not agree with the latest harmful conduct" and that it will continue to evaluate new legal options with its legal advisors, including procedures at both the national and international levels.
The two ports were part of a broader acquisition agreement that CK Hutchison was negotiating with a consortium made up of BlackRock and MSC. According to the latest information, that consortium—recently joined by Chinese company COSCO—plans to exclude the ports from the operation amid the ongoing legal dispute.