Panama's Supreme Court annulled the legal basis for CK Hutchison’s concession to operate two Panama Canal port terminals, affecting Cristóbal and Balboa and casting doubt on a planned sale to a BlackRock‑led consortium. The ruling follows allegations and an audit claiming the company owed about $1.2 billion and could prompt appeals and diplomatic responses. Beijing and Hong Kong protested, while Panama reiterates the canal’s neutrality amid U.S.–China rivalry.
Panama Supreme Court Voids CK Hutchison’s Canal Port Concession, Putting BlackRock Deal in Doubt
The Port of Balboa at the Pacific entrance of the Panama Canal in Panama City on October 6, 2025 (MARTIN BERNETTI)(MARTIN BERNETTI/AFP/AFP)
Panama's Supreme Court on Thursday annulled the laws that allowed Hong Kong-based CK Hutchison to operate two major port terminals on the Panama Canal, a decision that weakens Chinese commercial influence over the strategic waterway and creates legal uncertainty for a high-profile proposed sale.
Background and Ruling
In a statement, the Supreme Court said the legislation underpinning CK Hutchison's concession to operate two of the canal's five terminals was "unconstitutional." The ruling affects Panama Ports Company (PPC), the CK Hutchison subsidiary that manages Cristóbal at the Atlantic entrance and Balboa on the Pacific side. The concession had been automatically renewed in 2021 for another 25 years.
Commercial and Political Fallout
CK Hutchison has been negotiating a sale of the terminals to a consortium led by U.S. asset manager BlackRock. That proposed transaction is now in doubt pending clarification of the legal status of the concession. PPC called the judgment legally unfounded and warned it "jeopardizes not only PPC and its contract, but also the well‑being and stability of thousands of Panamanian families who depend directly and indirectly on port activity." Shares in CK Hutchison fell more than 4% in Hong Kong after the ruling.
Allegations and Audit Findings
The lawsuit that reached the high court argued the concession rested on unconstitutional laws and alleged the company failed to pay required taxes. In April, Panama's Comptroller's Office released an audit claiming PPC did not remit about $1.2 billion from its operations — an allegation the company disputes.
Geopolitical Reactions
Beijing pledged to "take all necessary measures to resolutely safeguard the legitimate rights and interests of Chinese companies," and Hong Kong's government also protested the decision. The episode has been framed in the wider contest between Washington and Beijing for influence over strategically important global trade routes: the United States and China are the canal's top users, and roughly 5% of global maritime trade transits the waterway.
Panama's Position
Panamanian leaders have sought to emphasize canal neutrality. President José Raúl Mulino has warned against turning the canal into a theatre of great‑power rivalry and urged both sides not to enlist Panama in their geopolitical competition. Nevertheless, Panama has recently taken steps that appear calculated to reassure the United States — withdrawing from China’s Belt and Road Initiative last year and announcing new joint U.S.–Panama canal defense drills earlier this month, the fourth such exercise since 2025.
Observers say the ruling could prompt legal appeals and diplomatic pressure, complicating operations at two of the canal’s busiest terminals and raising questions about the future ownership and management of key global trade infrastructure.
What Comes Next
The immediate next steps are likely to include legal challenges and negotiations among the Panamanian government, CK Hutchison, potential buyers and foreign governments with strategic interests. The fate of the BlackRock‑led purchase, the outcome of any appeals and the government’s response will determine both short‑term port operations and the longer‑term geopolitical balance around the canal.
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