Li Ka-Shing’s Port Empire Hit by Forced Takeover Amid Panama Legal Dispute
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The Balboa port in Panama. Photo: VCG
The Panamanian government has forcibly seized control of two key canal ports from a subsidiary of Hong Kong-based CK Hutchison Holdings Ltd., following a presidential decree that revoked the company’s operating rights.
Authorities in Panama City issued the executive order on Monday based on a Supreme Court ruling from late January, formally engaging the Panama Maritime Authority to assume control of the facilities. The government designated units of A.P. Moller-Maersk A/S and Mediterranean Shipping Co. (MSC) to take over operations immediately on an interim basis for 18 months.
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- Panama seized two key canal ports from CK Hutchison, citing a Supreme Court ruling declaring the concession unconstitutional.
- Maersk and MSC were appointed to operate the ports for 18 months; CK Hutchison halted operations and started arbitration, condemning the seizure as illegal.
- The move raises global investor concerns about legal certainty and risks for infrastructure investments in Panama.
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Who’s Who
- CK Hutchison Holdings Ltd.
- CK Hutchison Holdings Ltd. (长和), a conglomerate controlled by Li Ka-shing's family, had its operating rights for two key Panama Canal ports revoked by the Panamanian government. This action, based on a Supreme Court ruling, led to the immediate seizure of the Cristobal and Balboa container terminals. CK Hutchison, which held a 90% stake in the operator, has condemned the move as illegal and plans to pursue legal action, including international arbitration, to address the forced termination and seek damages.
- A.P. Moller-Maersk A/S
- A.P. Moller-Maersk A/S (Maersk) is a Danish shipping and logistics company. Its subsidiary, APM Terminals, has been designated by the Panamanian government to temporarily manage the Balboa port for 18 months. This follows the Panamanian government's seizure of two key canal ports from a subsidiary of Hong Kong-based CK Hutchison Holdings Ltd.
- Mediterranean Shipping Co.
- Mediterranean Shipping Co. (MSC) had its subsidiary, Terminal Investment Limited (TiL), designated by the Panamanian government to temporarily operate the Cristobal port. This assignment is for an interim period of 18 months, following the Panamanian government's seizure of the port from CK Hutchison Holdings Ltd.
- Hutchison Ports PPC
- Hutchison Ports PPC is the operator of the Cristobal and Balboa container terminals in Panama, with CK Hutchison holding a 90% stake and the Panamanian state holding the remaining 10%. The Panamanian government has forcibly seized control of these ports, revoking Hutchison Ports PPC's operating rights following a Supreme Court ruling.
- APM Terminals
- APM Terminals, a subsidiary of Maersk, has been designated by the Panamanian government to temporarily manage the Balboa port. This decision follows the government's seizure of two key canal ports from CK Hutchison Holdings Ltd. The temporary arrangement, effective immediately, is set for 18 months, aiming to maintain continuity in port operations after the eviction of the previous operator.
- Terminal Investment Limited (TiL)
- Terminal Investment Limited (TiL), a subsidiary of Mediterranean Shipping Co. (MSC), has been designated by the Panamanian government to temporarily operate the Cristobal port for an 18-month period. This follows the Panamanian government's seizure of two key canal ports from CK Hutchison Holdings Ltd.
- Haiwen & Partners
- Haiwen & Partners is a law firm. Liu Yang, a partner at their Hong Kong office, provided expert commentary on the Panamanian government's seizure of canal ports from CK Hutchison. Liu indicated that the critical battleground for this dispute would likely be international arbitration, focusing on potential violations of concession contract obligations, "indirect expropriation," or "fair and equitable treatment" if investment treaties are involved.
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What Happened When
- 1997：
- Initial agreement was made for the concession contract on the Panama Canal ports.
- 2021：
- Initial agreement for operating the port terminals was renewed for another 25 years.
- As of March 2025：
- Cristobal and Balboa terminals were among 43 international assets CK Hutchison had planned to sell.
- Late January 2026：
- Panama Supreme Court ruled to revoke CK Hutchison Holdings Ltd.'s concession contract, declaring it unconstitutional.
- 2026-01-29：
- Panama’s Supreme Court issued a formal decision on the company's concession contract.
- Early February 2026：
- CK Hutchison announced it had commenced arbitration proceedings against Panama.
- 2026-02-23：
- Panamanian authorities issued an executive order to revoke the company's operating rights and engaged the Panama Maritime Authority to assume control.
- 2026-02-23：
- Government officials forcibly entered Cristobal and Balboa container terminals, barring CK Hutchison representatives and halting company operations.
- 2026-02-24：
- CK Hutchison publicly confirmed the seizure, condemned the action as illegal, and stated intentions to pursue further legal action.
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