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President Jose Mulino signs temporary concession agreements for APMT and TiL
The Panamanian government yesterday formally took control of the container terminals at Cristobal and Balboa from Hutchison’s Panama Ports Company (PPC), and handed over operations to MSC and APMT, respectively.
Hong Kong’s CK Hutchison confirmed that the government had physically taken over the facilities yesterday and prevented PPC staff from going to work.
It said: “Over a short period of time on the morning of 23 February, government representatives arrived without invitation to the terminals and informed representatives of PPC that the concession no longer exists and that PPC must cease operations, and instructed that PPC employees would be transferred out of PPC, must not communicate with PPC, and must comply with government instructions, under threat of criminal prosecution.
“The state now has control of the terminals,” it added.
Shortly before entering the facilities, Panama’s official gazette published its Supreme Court ruling on PPC’s operating concession – Law No 5 of 16 January 1997 – accompanied by an executive decree issued by the president ordering “the temporary occupation” of all movable property, “which includes, but is not limited to, cranes, motor vehicles of any kind, computers, programs, software, and other goods of any nature that are inside or outside the facilities of the ports of Balboa and Cristobal, that are necessary, as provided and required by the Panama Maritime Authority, to maintain the continuous and safe operation of the ports of Balboa and Cristobal”.
Meanwhile, Panama’s cabinet council also met yesterday to push through contracts allowing APM Terminals and MSC’s port operating arm, TiL, to assume operations.
Visiting the Balboa terminal yesterday, as PPC executives were ejected, Panama’s minister of labour and labour development, Jackeline Muñoz, promised there would be no job losses as a result of the seizure.
“I want to give the assurance that the work of each of the Panamanians who are in this port is guaranteed,” she said.
However, an equally pressing priority for APMT is the installation of a new terminal operating system, the operator set to replace the existing nGen system, designed in-house by Hutchison and deployed elsewhere in its port portfolio, such as Felixstowe, with the widely used Navis N4 system.
APMT Panama CEO Marliz Bermudez said the “priority is to ensure continuity of the logistics hub while a new operating system is installed to restore container movements at Balboa with the least possible disruption”.
There has been a build-up of containerships at Balboa in recent days – according to Xeneta’s eeSea liner database, 83% of vessels at the port are awaiting a berth, with 10 at anchor and two alongside.
A further 34 vessels are en route to Balboa.
APMT said the Balboa terminal’s workers would be incorporated into the new concession framework through “the employer‑substitution process”.
And Ms Bermudez said: “During this initial stabilisation phase, our responsibility is to ensure that Panama maintains the continuity and reliability of its logistics hub, while safeguarding cargo and protecting the safety of all the workforce.
“This process requires speed and precision, so that the port can progressively resume operations once the system installation is completed, along with other operational, audit, training, and verification tasks that our team will be carrying out at the port of Balboa starting today,” she added.
Meanwhile, CK Hutchison continued to claim the action was “unlawful”, and indicated it would press ahead with legal action.
“PPC and CKHH will continue to consult with their legal advisors regarding the ruling and forceful takeover, the purported termination of PPC’s concession and all available recourse, including additional national and international legal proceedings against the republic of Panama and its agents and third parties colluding with them, to reserve all rights and recourse against them, in relation to this matter,” it said.
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