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This decision adds more uncertainty to the earlier agreement about selling Hutchison Global Port assets to a group of investors.
The Supreme Court of Panama, following a thorough examination of the matter, determined that the laws and regulations forming the basis of the concession agreement between the government and Panama Ports Co. (a subsidiary of Hutchison) are unconstitutional. This decision, which was released on Thursday, states that the rules governing the management of the ports of Balboa, located on the Pacific Ocean, and Cristobal, situated on the Atlantic Ocean, are not in line with the constitution.
Hutchison's subsidiary entered into a terminal management agreement in 1997, and this agreement was later renewed in 2021.
Panama Ports stated that it has not yet received an official notice regarding the court's decision. The company states that the resolution goes against the legal foundation of its operations in ports and urges collaboration with the government to prevent interruptions and ensure the protection of the concession. Panama Ports stated that it retains the right to utilize all available legal measures.
The company is unable to challenge the Supreme Court's ruling, but it has the option to ask for further explanation from the court, which will postpone the end of the port management agreement.
After removing the license from Panama Ports, the country's officials intend to hire a company to oversee the ports' operations to keep them running smoothly until a new licensing process is conducted, according to The Wall Street Journal, which is citing state sources.
source: wsj.com
The Supreme Court of Panama, following a thorough examination of the matter, determined that the laws and regulations forming the basis of the concession agreement between the government and Panama Ports Co. (a subsidiary of Hutchison) are unconstitutional. This decision, which was released on Thursday, states that the rules governing the management of the ports of Balboa, located on the Pacific Ocean, and Cristobal, situated on the Atlantic Ocean, are not in line with the constitution.
Hutchison's subsidiary entered into a terminal management agreement in 1997, and this agreement was later renewed in 2021.
Panama Ports stated that it has not yet received an official notice regarding the court's decision. The company states that the resolution goes against the legal foundation of its operations in ports and urges collaboration with the government to prevent interruptions and ensure the protection of the concession. Panama Ports stated that it retains the right to utilize all available legal measures.
The company is unable to challenge the Supreme Court's ruling, but it has the option to ask for further explanation from the court, which will postpone the end of the port management agreement.
After removing the license from Panama Ports, the country's officials intend to hire a company to oversee the ports' operations to keep them running smoothly until a new licensing process is conducted, according to The Wall Street Journal, which is citing state sources.
source: wsj.com