Hong Kong's CK Hutchison has initiated international arbitration against Panama, seeking more than $1.5 billion in damages after the country seized two ports at the Panama Canal, according to a company statement reported by infohub.kz.
The company alleges that Panama breached an investment protection treaty through "sovereign acts that targeted a decades-old ports concession" and conducted a "state attack campaign" on its assets in the Central American country.
In February, Panama's government seized the Balboa and Cristobal ports, located at each end of the canal, after its Supreme Court ruled that a concession held by CK Hutchison's subsidiary to operate the ports was unconstitutional.
The ports have become a flashpoint in U.S.-China tensions, with Donald Trump accusing China of "running" the canal after his return to the White House.
The Panama Canal is owned and managed by Panama. However, CK Hutchison's subsidiary, Panama Ports Company, had operated the two ports since 1997 and renewed its concession for 25 years in 2021.
Beijing and Hong Kong have protested Panama's takeover of the ports.
CK Hutchison, controlled by the family of Hong Kong's richest man Li Ka-shing, last year agreed to sell its global ports business, including the two Panama ports, to a consortium involving U.S. investment firm BlackRock for $23 billion. However, the deal has stalled amid geopolitical tensions and legal disputes among China, the U.S., and Panama.
In March, Panama Ports Company separately sought at least $2 billion in compensation from Panama over the takeover, initiating international arbitration. CK Hutchison said those proceedings are progressing.
CK Hutchison emphasized that the new arbitration focuses on its treaty rights, distinct from the contract rights of Panama Ports Company in the earlier case.
In April, the subsidiary also launched arbitration against Danish shipping group Maersk after it took over some port operations in Panama. Maersk has denied liability.