Hong Kong's CK Hutchison Holdings has warned shipping giant Maersk that it will take legal action if it attempts to take over two strategic ports in Panama.
The Supreme Court of Panama ruled that contracts held by CK Hutchison's subsidiary for operating the Balboa Port and Cristobal Port are unconstitutional, and arranged for a Danish company, Maersk’s subsidiary, to temporarily take over the operation of the two ports.
According to Bloomberg, CK Hutchison stated in a Thursday (February 12) statement that it has notified Maersk that taking over operations of the two terminals without its consent would cause the group losses and “will trigger legal claims against APM Terminals.” APM Terminals is a Maersk Group subsidiary specializing in port and terminal operations.
The statement also said that the court's ruling has not yet been published nor taken effect, and that once CK Hutchison's contracts are terminated, the two ports will be “unable to continue operations.” According to Hong Kong's Sing Tao Daily, sources indicated this is because APM Terminals' systems may not be compatible with existing Panamanian port facilities.
The statement also said that the court's ruling has not yet been published nor taken effect, and that once CK Hutchison's contracts are terminated, the two ports will be “unable to continue operations.” According to Hong Kong's Sing Tao Daily, sources indicated this is because APM Terminals' systems may not be compatible with existing Panamanian port facilities.
CK Hutchison stated in its announcement that the continued operation of the ports depends entirely on the subsequent actions of the Supreme Court of Panama and the Panamanian authorities.
The company further said it has invited relevant Panamanian parties for consultations to resolve the dispute over the two ports, and has notified the Panamanian side of relevant actions, but did not disclose further details. CK Hutchison has also initiated arbitration with the International Chamber of Commerce.
The company further said it has invited relevant Panamanian parties for consultations to resolve the dispute over the two ports, and has notified the Panamanian side of relevant actions, but did not disclose further details. CK Hutchison has also initiated arbitration with the International Chamber of Commerce.