Danish shipping giant Maersk will temporarily operate two ports at the Panama Canal after Panama’s Supreme Court ruled that the concession contract awarded to a Hong Kong-based operator was unconstitutional.
The ruling targets the long-running concession held by Panama Ports Company, a subsidiary of CK Hutchison, which operates key terminals at both ends of the canal. The court said the contract violated Panama’s constitution and “did not serve the public interest,” faulting the deal for granting exclusive privileges and tax exemptions, and for lacking requirements such as environmental impact assessments.
In its decision, the court said: “Disproportionate rights and prerogatives are granted to PPC, creating conditions that effectively eliminate competition and result in a monopoly in practice, even though no monopoly is formally declared.”
Panama’s president said port operations would continue without interruption during the transition, as authorities move to ensure continuity for a route that handles a significant share of US container traffic and a meaningful slice of global maritime trade.
Reporting around the ruling also highlighted audit concerns. The Los Angeles Times reported that the concession was struck down following audit findings that included accounting errors and $300 million in irregularities.
The court decision injects uncertainty into a larger, separate transaction: a proposed multi-billion-dollar sale of global port assets linked to CK Hutchison. Analysts and shipping observers say the Panama terminals carry outsized geopolitical weight despite being ports adjacent to the canal rather than the canal itself.
What happens next is expected to include a formal transition plan and, potentially, a new bidding process for longer-term operators under revised terms, with global logistics firms likely to watch closely.