Panama's supreme court has ruled that the concession held by Panama Ports Company (PPC), a subsidiary of Hong Kong's CK Hutchison, for ports at each end of the Panama Canal is unconstitutional. The decision, announced on Thursday, aligns with US efforts to curb Chinese influence over the strategic waterway.
President José Raúl Mulino assured that the canal would continue operating normally. In a video address, he stated that maritime officials would work with PPC until the ruling is executed, after which a subsidiary of Danish logistics firm AP Moller-Maersk would temporarily operate the ports until a new concession is awarded.
The court's ruling followed an audit by Panama's comptroller, which alleged irregularities in the 25-year extension granted in 2021. The Trump administration has made blocking Chinese influence over the canal a priority, with US Secretary of State Marco Rubio visiting Panama as his first overseas stop to press the issue.
PPC said it had not been notified of the decision and insisted its concession resulted from transparent international bidding. It stated the ruling lacked legal basis and jeopardised thousands of Panamanian families, reserving the right to pursue legal action in Panama or elsewhere.
The Hong Kong government firmly rejected the ruling, urging Panama to respect contractual obligations and provide a fair business environment. It advised Hong Kong enterprises to review their investments in Panama. China's foreign ministry spokesperson Guo Jiakun said Beijing would take all necessary measures to safeguard the legitimate rights of the Chinese company.
