Panama court kicks Hong Kong’s CK Hutchison out of canal ports

January 30, 2026 adminsr

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Panama’s top court has annulled a contract for a unit of a Hong Kong company to operate a pair of Panama Canal ports, casting doubt over a deal to sell the terminals and boosting Donald Trump’s efforts to reassert US influence in the region.

In a unanimous ruling published late on Thursday, the Supreme Court said the concession for a unit of CK Hutchison Holdings to run the Balboa and Cristóbal ports at either end of the waterway was unconstitutional.

The court said in a statement the decision, in a lawsuit brought by Panama’s comptroller after a government audit alleging irregularities, was reached after “wide deliberation and discussion”.

The ruling will delight the US president, who vowed last year to “take back control” of the canal connecting the Pacific and the Caribbean.

It also throws into doubt a planned deal under which China, which has invested heavily in Panama since the country switched diplomatic recognition from Taiwan in 2017, hoped to keep sway over the two ports.

US critics of Chinese influence in the Latin American country have focused on the two ports, which CK Hutchison has operated for nearly 30 years. The contract was extended for 25 years in 2021, without a bidding process.

CK Hutchison said last March it had agreed to sell its 90 per cent stake in the company that owns and runs the two ports to a consortium including BlackRock.

The proposal also included an 80 per cent stake in subsidiaries that run CK’s 43 non-Chinese ports in 23 countries.

The $23bn deal won praise from Trump, who hailed it as a sign his administration was “reclaiming” the canal. But Beijing later insisted that China’s state-owned shipping giant Cosco should have a majority stakeprompting the buyers to reconsider.

CK Hutchison’s share price fell 3.2 per cent in Hong Kong to HK$64.15 (US$8.21) per share. The company did not immediately respond to a request for comment.

Panama is set to have to put the ports out to tender again amid speculation that officials could separate them to maximise value. Panama’s President José Raúl Mulino and the country’s maritime authority are expected to announce the next steps on Friday.

Panama’s finance minister Felipe Chapman said his country had stressed to China in the run-up to the ruling that “the executive has no sway and does not control what another branch of the state does”.

“We do have the responsibility to accept the decisions of the Supreme Court,” he told the FT this week.

Chapman also noted that Panamanian law did not allow state-owned companies to own port concessions, a stipulation that would rule out Beijing’s move to secure a majority stake for Cosco.

One person with knowledge of the ruling said the government will decide whether the canal’s state-owned operator, the Panama Canal Authority, will run the ports on a temporary basis until they can be tendered. It was not immediately clear when that decision will be made.

The court’s ruling cannot be appealed but Hutchison can seek clarifications, which might delay its implementation.

Panama’s comptroller brought the lawsuit, over whether CK Hutchison had breached concession contracts and violated the constitution, in July last year. It followed a government audit alleging irregularities and showing that $1.3bn in revenue had been lost since Hutchison took over the ports in 1997.

The US built the 82km canal more than a century ago and controlled it and an adjacent stretch of territory until it signed a treaty in 1977 for a gradual handover to Panama, which was completed in 1999.