CK Hutchison pursues $1.5 billion damages claim against Panama over seized ports

Hong Kong-based conglomerate CK Hutchison Holdings has initiated arbitration seeking more than $1.5 billion in damages from Panama after the Central American nation seized two key Panama Canal ports. The dispute centers on the takeover of Balboa and Cristobal ports, which Panama’s Supreme Court ruled unconstitutional in February, stripping CK Hutchison’s subsidiary of its decades-long concession. The company alleges Panama breached an investment protection treaty through what it describes as a “state attack campaign” targeting its assets, framing the seizure as a sovereign act amid escalating U.S.-China tensions over control of the canal. CK Hutchison’s Panama Ports Co. had operated the ports since 1997, with a 25-year concession renewed in 2021, but the government’s takeover followed allegations from former U.S. President Donald Trump that China was “running” the canal after his return to office. Beijing and Hong Kong have publicly opposed the seizure. The legal battle unfolds against a backdrop of geopolitical friction, with CK Hutchison’s planned $23 billion sale of its global ports business—including the Panama assets—to a BlackRock-led consortium stalled by these disputes. Separately, Panama Ports Co. had already sought at least $2 billion in compensation in March over the unlawful takeover claim, while its subsidiary initiated arbitration against Danish shipping giant Maersk in April after Maersk took over some port operations. Maersk has denied liability. CK Hutchison emphasized that the new arbitration focuses on treaty rights distinct from the earlier contract-based claims, signaling a multi-pronged legal strategy to recover losses from the port seizures.