CK Hutchison seeks over $1.5bn in Panama ports case

CK Hutchison said on August 20 that it had filed international arbitration proceedings against Panama over the cancellation of its concession to operate two ports in the Panama Canal.

The Hong Kong conglomerate is seeking more than US$1.5 billion in damages. Its board said in a filing to the Hong Kong Stock Exchange that the claim was for the “destruction of the Company's investments in Panama.”

The dispute follows a Panama supreme court ruling in January that struck down the contract allowing Panama Ports Company, a CK Hutchison unit, to manage the canal's Pacific port of Balboa and the Atlantic port at Cristobal.

CK Hutchison said the arbitration concerns alleged breaches of an investment protection treaty that culminated in the cancellation of the concession and the takeover of the two ports. The board said it disagreed with Panama's measures and would keep seeking a resolution while pursuing its rights under the treaty and international law.

Panama Ports Company filed a lawsuit in February opposing the suspension of its Panama Canal operations and later said it was seeking at least US$2 billion in damages. CK Hutchison said the subsidiary would continue to pursue its own separate arbitration rights.

The Panama Canal connects the Atlantic and Pacific oceans and handles about 40 percent of US container traffic and five percent of world trade. The court decision came after claims by US President Donald Trump that China effectively ran the canal, amid wider tensions between Washington and Beijing.