Hong Kong-based CK Hutchison Holdings, a leading port investor, developer and operator, warned on Thursday (local time) of legal action against Danish shipping giant AP Moller-Maersk, CNBC reported.
AP Moller-Maersk faced legal action after Panamanian authorities tapped the group to take over the operation of two critical ports, Port of Balboa on the Pacific coast and Cristóbal on the Atlantic side, at either end of the Panama Canal, from the Hong Kong-based company.
In a statement issued on Thursday, CK Hutchison warned the Danish group that “any action” by the group or its subsidiaries to operate ports without an agreement could “result in legal action”.
At the end of January, Panama’s Supreme Court ruled that a contract entered into by a subsidiary of Hutchison to operate the ports was unconstitutional. Before a bid could be submitted and the contract awarded, the court ordered the Danish shipping giant to take control of the ports in the interim, the AP reported.
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Panama dispute
The dispute over two Panamanian ports is part of a wider rivalry between the US and China, with the Central American country caught in the crossfire. In 2025, US President Donald Trump claimed that China was operating the Panama Canal, and CK Hutchison was to sell the two ports to a consortium that included US investment firm BlackRock. While Hutchison negotiated a $23 billion deal to sell non-Chinese port subsidiaries, Beijing quickly intervened and the deal was put on hold.
Panama Ports Co is a subsidiary of a Hong Kong firm that has operated both Panamanian ports since 1997. In 2021, the company’s contract was extended for 25 years.
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The Panama Canal served as a key trade passage connecting the Pacific and the Atlantic. The canal handles roughly 40% of all Washington container traffic each year. Built by Washington in the early 20th century, it was operated by US authorities for decades before handing over full control to Panama in 1999.
CK Hutchison’s response to the Supreme Court of Panama
Tensions escalated this January after the Supreme Court’s decision, with which Hutchison “strongly disagreed” and launched arbitration proceedings against Panama.
On Thursday (local time), the Hong Kong-based company said Panama had been notified of the dispute under the investment protection treaty, adding that it would pursue “all available means, including further domestic and international legal proceedings”.
Panamanian President José Raúl Mulino previously promised that both ports would be able to operate without any interruption after the Supreme Court decision. However, CK Hutchison said the continued operation of the ports “depends solely on the actions of the Supreme Court of Panama and the State of Panama,” which he cannot control.
In a statement, the company also said it will consider and explore all available remedies, which include further domestic and international legal proceedings regarding the Panamanian ports.
Not a party to the legal dispute: APM Terminals
APM Terminals, a local subsidiary of Maersk, told the AP it was not a party to the legal process over the ports, adding that it had only expressed interest to the Panamanian government to take over operations at the ports in the meantime “to mitigate risks that could affect essential services for regional and global trade.”
China reacts to the Supreme Court decision
In what could be seen as China’s strongest rebuke yet, the country warned Panama on Wednesday (local time) that it would pay a heavy price, politically and economically, and advised it to change course.
Beijing also ordered state-owned firms to suspend negotiations on new projects in the region and asked shipping companies to consider rerouting their cargoes through other ports.
Is the verdict in favor of the US?
The ruling by the Panamanian Supreme Court is seen as a major victory for the Trump administration, given that the US has made blocking Chinese influence in global trade one of its top priorities.
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The CNBC report further suggests that the standoff between Beijing and Washington could turn out to be more manageable for Washington than it seems, according to Reva Goujon, director of consulting firm Rhodium Group. She said the U.S. has significant leverage through its treaty with Panama that could help it resist any intervention on national security grounds.
what’s next
Citing analysts, the report suggests that the law is likely to end up in vain for CK Hutchison and that there is very little the Hong Kong-based company can do despite having behind-the-scenes support from Beijing. Any legal claims brought by Hutchison, including allegations of trespass, will depend solely on whether the Company’s Port Agreement is valid or has been officially terminated.
Will the dispute end the recent thaw in bilateral relations between the US and China, or will both sides try to prevent it from escalating into a wider diplomatic rift?