Hong Kong’s CK Hutchison Holdings has issued a formal warning of legal action against Denmark’s A.P. Moller-Maersk and reaffirmed its intention to pursue all available legal avenues after Panama’s Supreme Court ruled that its concession to operate the Balboa and Cristóbal ports at both ends of the Panama Canal was unconstitutional.

The court decision, handed down in late January, voided the contract held by the company’s Panama Ports Company subsidiary, casting uncertainty over its long-standing role in managing two of the world’s most strategic maritime gateways and complicating plans to sell global port assets.

In its statement, CK Hutchison said it had notified Panamanian authorities of a dispute under an investment protection treaty and was inviting consultations to protect its rights and interests.

It also directly warned A.P. Moller-Maersk’s unit, APM Terminals, that any attempt to assume control of the terminals without CK Hutchison’s agreement would lead to damages claims and other legal recourse.

The company has already launched international arbitration proceedings against Panama, asserting its strong disagreement with the court ruling and retaining the right to pursue additional national and international proceedings.

Panamanian authorities earlier indicated that APM Terminals could temporarily operate the Balboa and Cristóbal terminals to avoid disruption to essential services for regional and global trade while a new concession process is organised.

APM Terminals has said it is not a party to the underlying dispute but signalled its willingness to step in to ensure continuity of operations.

CK Hutchison countered that Panama has provided no clear assurances about the continued operation of its subsidiary and said the situation is worsening uncertainty over the ports’ future.

The dispute has taken place against the backdrop of broader geopolitical tensions between the United States and China, with the strategically vital Panama Canal at the centre of competing interests.

CK Hutchison’s subsidiary has operated the ports since the 1990s, with the concession last renewed in 2021, and the company had been exploring a sale of its global ports business, including the Panama terminals.

The court’s decision and the potential transitional arrangement with APM Terminals have added complexity to those plans.

Despite reassurances from Panama’s president that port operations will continue uninterrupted, CK Hutchison maintains that the ultimate control of the terminals and the protection of its long-term investments depend on the outcome of ongoing legal processes.