This aerial photo shows the Taiwanese cargo ship “Yang Ming” departing from the Panama Canal on the Pacific side of Panama City on October 6, 2025.
Martin Burnetti | Martin Burnetti AFP | Getty Images
Hong Kong’s CK Hutchison Holdings has threatened legal action against Danish shipping giant AP Moller-Maersk after Panamanian authorities wiretapped the group to temporarily take over operations of two strategic ports at either end of the Panama Canal.
In a statement Thursday, CK Hutchison warned the Associated Press Moller-Maersk that he would likely “recourse to legal action” if the Danish group or its subsidiaries take “any steps” to operate the port without an agreement. According to CNBC’s translation of the Chinese statement:
The smoldering conflict has become a geopolitical flashpoint between the United States and China, with Panama also caught in the crossfire.
CK Hutchison negotiated a $23 billion deal with a BlackRock-led consortium to sell its non-Chinese port subsidiaries after US President Donald Trump claimed last year that China was “running the Panama Canal.” The Chinese government quickly intervened, describing the sale as a “humiliation” to U.S. pressure and stalling the deal.
Tensions escalated last month when Panama’s Supreme Court ruled that a subsidiary of CK Hutchison’s concession to operate two ports was “unconstitutional.” The company “strongly disagrees” with the ruling and has started arbitration proceedings against Panama.
CK Hutchison also said Thursday that it had notified Panama of the dispute under the Investment Protection Treaty and would pursue “all available avenues, including additional domestic and international litigation.”
APM Terminals, a subsidiary of Maersk, has asked to take over the port, the report said, saying it was not a party to the legal dispute and had only offered to intervene temporarily “to reduce risks that may affect services essential to regional and global trade.”
Maersk shares fell more than 3% in Copenhagen on Thursday.
Who has the card?
Interest in Panama’s ports has skyrocketed this year. The Panama court’s ruling is seen as a major victory for the United States, given that the White House has made curbing China’s influence on global trade arteries one of its top priorities.
In its strongest rebuke to date, the Chinese government warned on Wednesday that unless the Central American country changed course, “it is inevitable that it will pay a heavy political and economic price.” The Chinese government’s Hong Kong and Macau Affairs Office criticized the court’s ruling, calling it “logically flawed” and “utterly absurd.”
China also told state-owned companies to halt talks over new projects in Panama and asked shipping companies to consider rerouting cargo through other ports, Bloomberg reported last week.
The conflict may be easier for the U.S. government to manage than it appears, said Reba Gudjon, director of advisory firm Rhodium Group. The United States maintains significant influence through its treaty with Panama, which could allow it to defend against any national security intervention, he said.
However, the Chinese government claimed a partial victory, derailing the U.S. government’s original plan to fully acquire CK Hutchison’s global port holdings, Goudjon said.
Gujon said China needs to “make it as difficult as possible for the U.S. to counterattack in Panama so as not to set a precedent,” noting that China’s state-run shipping giant Cosco’s Chancay port in Peru, a major infrastructure investment by the Chinese government in Latin America, is also in the U.S. crosshairs.
The United States has raised concerns over its sovereignty over the port of Chancay, a deep-sea facility near Lima. The U.S. State Department’s Bureau of Western Hemisphere Affairs said in a post to X on Thursday that Peru may be “powerless” to oversee a vital port that is “under the jurisdiction of a predatory Chinese owner.”
But for CK Hutchison, that lawsuit is likely to be futile, said Peter Alexander, managing director at Z-Ben Advisors. “Even with behind-the-scenes support from Beijing, there’s little C.K. Hutchison can do.”
A vital trade route between the Atlantic and Pacific Oceans, the Panama Canal handles approximately 40% of all U.S. container traffic each year. Panama Ports Co., a subsidiary of CK Hutchison, has operated the vessel since 1997 and received a 25-year contract renewal in 2021.
The canal was built by the United States in the early 20th century and operated for several decades before transferring full control to Panama in 1999.
Analysts say the dispute could drag on and further strain U.S.-China relations, already soured by a year of tariff tensions, Beijing’s tightening of its grip on rare earth exports, disputes over Taiwan, and U.S. restrictions on high-tech exports.
CK Hutchison said Thursday that the continued operation of the two ports “depends solely on the actions of the Panamanian Supreme Court and the Panamanian state” and is beyond the control of the Panamanian government.
