Panama's Supreme Court has voided contracts held by Panama Ports Company (PPC), a unit of Hong Kong-based CK Hutchison, finding the agreements did not 'serve the public interest and social welfare.'
The court said the contracts granted exclusive privileges and tax exemptions, lacked required environmental impact assessments, and forced the government to seek PPC's approval for future concessions. A copy of the decision was obtained by TVN; the full written ruling has not yet been released.
PANAMA CITY, Jan 30 (Reuters) — Panama's Supreme Court on Thursday voided contracts held by Panama Ports Company (PPC), a unit of Hong Kong-based CK Hutchison, that governed the operation of container terminals at the Panama Canal's Pacific and Atlantic entrances.
The court said the agreements did not 'serve the public interest and social welfare.' While the decision was announced on Thursday, the court has not yet released the full written opinion explaining its reasoning. A copy of the decision was obtained by local broadcaster TVN and a court official confirmed its authenticity.
According to the court, the contracts violated Panama's constitution for several reasons: they granted PPC exclusive privileges and tax exemptions not available to other competitors; they lacked required environmental impact assessments; and they included clauses obliging the government to seek the company's approval before granting future concessions.
PPC, a subsidiary of CK Hutchison, has operated container terminals at both entrances to the canal since the 1990s. The court's decision could prompt renegotiation of terms, affect future concession processes and raise legal and commercial questions for the company and the Panamanian government. The full implications will become clearer once the court publishes its written ruling.
Reporting: Elida Moreno; Additional reporting: Natalia Siniawski and Kylie Madry; Editing: Emily Green.
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