Panama taps a US law firm for the ports fight

Panama's Cabinet Council on Monday 2 November authorised the Ministry of Economy and Finance (MEF) to hire the law firm Hogan Lovells Cadwalader US LLP for USD 3,887,350 to defend the country in the international investment arbitration brought by Hong Kong's CK Hutchison Holdings, La Prensa, Telemetro and Infobae reported. The Cabinet approved it as resolution 146-26 under an exceptional procurement procedure. The resolution has not yet been published in the Gaceta Oficial.

A day later, US President Donald Trump sent President José Raúl Mulino a 3 November message, released by the US Embassy, praising his government "for complying with the sovereign ruling" (quotes are our translation of the Spanish text released by the US Embassy) of Panama's Supreme Court on the ports of Balboa and Cristóbal.

How the dispute started

In late January 2026 the Supreme Court declared unconstitutional the law that approved the port concession of Panama Ports Company (PPC), a CK Hutchison subsidiary, at Balboa and Cristóbal (La Prensa).
PPC launched an arbitration at the International Chamber of Commerce on 3 February 2026 (La Prensa). Investment Treaty News reported a claim of USD 2 billion.
The state took over the terminals. Since late February 2026, APM Terminals (Maersk) has run Balboa and Terminal Investment Limited (MSC) has run Cristóbal under temporary contracts of up to 18 months, while a new concession model is prepared (Contraloría; La Prensa).
CK Hutchison then filed its own investment arbitration, notified to the government on 19 August 2026. It runs under the UNCITRAL Arbitration Rules (2021). CK Hutchison is represented by Paul Hastings LLP and Morgan & Morgan (La Prensa).

What Trump's letter said

Trump called Panama "one of our closest and most trusted partners" and said US humanitarian, logistics and technical aid reached quake victims within 24 hours (La Prensa; TVN).
He said complying with the port ruling reinforces "investor confidence" in Panama's courts and opens the maritime sector to "trusted investors" (US Embassy text as reported by La Prensa and TVN).
He mentioned Panama joining the Americas Counter Cartel Coalition, the Shield of the Americas and Pax Silica, and the in-person PANAMAX exercises, the first in 14 years.
He said he hopes to deepen Canal security cooperation and find "new economic opportunities" as Panama invests in the Canal and other infrastructure.

Also approved on 2 November

Resolution 145-26 lets Metro de Panamá hire Consorcio PMTS Línea 3 (Nippon Koei companies) for B/.16,223,996.07 to manage Line 3 until 30 June 2029, covering design, contract management and the underground section (Infobae).

What it means for expats

The arbitrations will take time and the costs fall on the state. For residents, nothing changes day to day; the ports keep operating under temporary operators.
For investors and business owners, the case is a test of how Panama handles long-term concessions. Watch the outcome if you hold or plan assets tied to state contracts.
US-Panama relations look calmer than in 2025. Trump's letter focuses on security and investment rather than the Canal ownership threats of last year.
Line 3 residents in Panamá Oeste: the new project-management contract runs to 30 June 2029.

Sources

La Prensa - MEF to pay USD 3.8 million to international firm for CK Hutchison arbitration - 2 Nov 2026
Telemetro - Cabinet approves B/.3.8 million contract for Panama's defence in CK Hutchison arbitration - 2 Nov 2026
Infobae - Panama prepares for CK Hutchison arbitration; Metro Line 3 contract - 3 Nov 2026
La Prensa - Trump sends letter to Mulino for the 123rd anniversary - 3 Nov 2026
TVN - Trump congratulates Panama and refers to Balboa and Cristóbal ports - 3 Nov 2026
Contraloría - Refrendo of the Balboa and Cristóbal transition contracts - 24 Feb 2026
La Prensa - How port operations are reorganised with APM Terminals and TIL - 23 Feb 2026
Investment Treaty News (IISD) - Panama faces USD 2 billion claim after port concessions annulled - 21 Apr 2026