(Feb 12): CK Hutchison Holdings Ltd has warned AP Moller-Maersk A/S of legal action should the Nordic company’s terminal unit try to take over operations at two ports near Panama’s strategic canal.
The warning came after authorities in the Central American nation invalidated CK Hutchison’s contract to operate the Balboa and Cristobal ports, seeking Maersk’s APM Terminals to run them in a transition phase.
“CK Hutchison has notified Maersk that any assumption by APM Terminals of operations of the two terminals without the agreement of CK Hutchison will cause damages” to the group and “will result in recourse against APMT”, the Hong Kong-based firm said in a statement on Thursday.
CK Hutchison also said it has notified Panama of a dispute to safeguard its rights and interests in an investment protection treaty, inviting consultations to resolve it. The company said last week it is seeking “extensive damages” through arbitration against Panama’s decision.
A spokesperson for Maersk in Copenhagen declined to comment on CK Hutchison’s warning and referred to the Danish company’s previous statement on the matter from Jan 30 when it said it would follow all legal requirements and procedures in starting operations.
Panama’s top court ruled in late January that the contract granted to Hong Kong tycoon Li Ka-shing’s CK Hutchison to operate the two ports was unconstitutional. Disputes over the Balboa and Cristobal ports in Panama have injected fresh uncertainty to CK Hutchison’s plan to sell 43 global facilities.
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The deal has become a proxy of US-China rivalry, making it one of the company’s most geopolitically complex yet. The ruling has handed a political win to President Donald Trump’s push to curb China’s influence over strategic infrastructure in Latin America, including the canal. But Beijing has expressed strong displeasure, warning of “serious political and economic consequences”.
The conglomerate said it remains fully committed to ensuring its local unit, Panama Ports Co, takes all steps reasonably available to protect its employees and avoid disruptions to port operations, according to the statement.
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