Panamanian President José Raul Mulino has ordered the temporary takeover of 2 ports operated by a unit of the Hong Kong (China)-based CK Hutchison corporation, after the country's constitutional court ruled to reject the business's concession contract.
Speaking on February 23, President Mulino said that the management and operation of 2 ports located on the Panama Canal strategic maritime route will be transferred to the Panama National Maritime Administration to "ensure the operation of the ports takes place continuously, safely and effectively".
Mr. Mulino emphasized that the takeover only applies to mobile devices at the port and "does not mean permanent ownership loss".
The Panamanian government will return assets, including cranes, to the owner "when the reason for the takeover no longer exists", and pay the corresponding compensation, unless these devices are sold to a third party.
According to La Prensa, APM Terminals - a subsidiary of AP Moller-Maersk, will temporarily operate one of the two ports, while the local unit of MSC Mediterranean Shipping Company based in Switzerland will manage the other port until a new contract is signed through a new bidding process.
The story revolves around 2 ports in Panama as part of a larger competition between the US and China, in which this Central American nation is stuck in the middle after President Donald Trump accused China of "running the Panama Canal".
CK Hutchison was originally expected to sell Balboa and Cristóbal ports to a joint venture of US investment company BlackRock, but this led to rapid intervention from the Chinese government, causing the deal to be suspended.
In January 2026, the Panamanian Supreme Court rejected the law approving the franchise contract for Panama Ports Company or PPC - a subsidiary of CK Hutchison. The ruling also invalidated the extension of port management granted in 2021, stripping of all legal basis for port operations.
PPC has operated these ports since 1997, when Panama granted the company the right to manage ports located at the Pacific and Atlantic Gateways of the Panama Canal.
CK Hutchison has sued Panama under the rules of the International Chamber of Commerce. It is not yet clear what the impact of the lawsuit will be and how long it will last. The Hong Kong-based company also threatened to sue APM Terminals if this unit operates franchising. The Danish group has responded that the group is not a party to the lawsuit.
