Hong Kong-based CK Hutchison has launched international arbitration against Panama, seeking more than HK$11.7 billion (US$1.5 billion) in damages over the government’s takeover of two strategic ports at the entrances to the Panama Canal. Announcing the move on Thursday, the Li Ka-shing family-backed conglomerate said Panama had breached an investment-protection treaty and international law through “sovereign acts” targeting its decades-old concession to operate the Balboa and Cristobal terminals, and “destroyed CK Hutchison’s investments in Panama”. “Panama has demonstrated that it has become a risky country that disregards the rule of law, corporate form, the scope of parties to a contract, the scope of arbitration agreements, treaty rights and the resolution of treaty disputes,” the conglomerate said in a statement. The latest claim is separate from contractual arbitration initiated by its 90 per cent-owned subsidiary, Panama Ports Company (PPC), which is seeking at least HK$15.6 billion (US$2 billion) in damages over what it called an illegal takeover of the operations. CK Hutchison said it notified Panama of the treaty dispute on February 4, following a year-long state campaign against its assets, but that efforts to reach a resolution had failed. Panama’s Supreme Court ruled in January that PPC’s concession to operate the ports was unconstitutional, annulling the contract. The government took control of the terminals on February 23. CK Hutchison accused the authorities of seizing property, equipment, technology, documents and other materials during the takeover, causing substantial damage to its investments. The company said Panama held only one “perfunctory” consultation meeting, more than six months after receiving the treaty notice, and had made no offer of compensation or resolution. CK Hutchison said the latest proceedings concerned its rights under an investment treaty, while PPC’s contractual claims were being pursued separately through the International Chamber of Commerce’s International Court of Arbitration. The group revealed last week that the “forced termination” of operations at the two strategic Panama Canal ports cut overall throughput by 1 per cent in the first half of the year, even as its wider port portfolio performed better than a year earlier. CK Hutchison owns a 90 per cent stake in PPC and held a 25-year concession to run the Balboa and Cristobal ports, which was renewed in 2021. The dispute followed CK Hutchison’s attempt last year to sell 43 ports in 23 countries in a US$22.8 billion deal, triggering a geopolitical stand-off between Washington and Beijing over control of global trade infrastructure.