A legal storm has erupted in Panama as a lawsuit seeks to revoke the concession granted to a Hong Kong-based company managing two crucial ports along the Panama Canal. Panama Ports Company, a subsidiary of CK Hutchison Holdings owned by billionaire Li Ka-shing, is at the center of this legal dispute. The company oversees operations at Cristobal on the Atlantic side and Balboa on the Pacific side, both integral to Panama's maritime infrastructure.
The controversy stems from allegations that Panama Ports Company has not fulfilled its tax obligations and has benefited from alleged unlawful advantages. Two Panamanian lawyers, Norman Castro and Julio Macias, filed the lawsuit on February 3, 2025, in the Supreme Court of Panama. They argue that the concession, originally granted in 1997 and renewed automatically in 2021 for another 25 years, breaches constitutional provisions.
"violates what the constitution says in about 10 articles" – Norman Castro
The lawyers assert that their decision to pursue legal action came after thorough scrutiny of the contract terms.
"After a detailed analysis of the contract… we decided that an action for unconstitutionality was the appropriate means" – Julio Macias
The legal case underscores broader geopolitical dynamics in the region. Amidst this legal wrangling, Panama President Jose Raul Mulino announced that the country would not renew its participation in China's Belt and Road Initiative. This decision followed a visit by US Secretary of State Marco Rubio, highlighting potential shifts in Panama's international alignments.
Panama Ports Company's operations have been pivotal since the original concession by the Panama government in 1997. The company's management of Cristobal and Balboa ports is vital for global trade routes passing through the Panama Canal. However, the lawsuit casts a shadow over its future operations, questioning whether it will continue to hold such significant economic influence.
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