Hong Kong’s CK Hutchison seeks HK$11.7b from Panama over canal ports dispute

Hong Kong's CK Hutchison, a Li Ka-shing family-owned conglomerate, has initiated international arbitration against Panama, demanding compensation exceeding HK$11.7 billion (US$1.5 billion) due to the government's seizure of two key ports adjacent to the Panama Canal. The conglomerate alleges that Panama violated an investment-protection treaty and international law by taking control of the Balboa and Cristobal terminals without proper process, effectively destroying its investments in the country.

Panama's Supreme Court recently ruled that the ports' concession was unconstitutional, leading to their takeover by the authorities on February 23. CK Hutchison asserts that the government forcibly removed property, equipment, technology, and other assets during the takeover, causing significant damage. The company maintains that Panama only held a brief consultation six months after receiving notice and has not offered any compensation.

While CK Hutchison pursues its claim under an investment treaty, its 90% stake subsidiary, Panama Ports Company (PPC), is separately seeking at least HK$15.6 billion (US$2 billion) through the International Chamber of Commerce's International Court of Arbitration, alleging an illegal takeover of its operations.