CK Hutchison, a company based in Hong Kong, has started arbitration against Danish shipping giant A.P. Moller-Maersk. This is part of a growing conflict over the control of important ports near the Panama Canal, which involves both business and political interests.

The company’s subsidiary, Panama Ports Company (PPC), announced that it has filed for arbitration in London. They claim Maersk broke its contract by working with the Panamanian government to remove PPC from operating the Balboa terminal.

This situation has been developing since January, when Panama's Supreme Court canceled a 1997 agreement that allowed PPC to operate the Balboa and Cristobal ports. The court's decision, based on constitutional issues, effectively ended CK Hutchison's nearly 30-year involvement at these key locations.

After the ruling, Panama took control of the ports and granted temporary operating contracts to Maersk and Mediterranean Shipping Company (MSC) while a new bidding process is being prepared. CK Hutchison has labeled this move illegal and has already filed another arbitration case against Panama, seeking over $2 billion in damages.

The conflict is also influenced by larger geopolitical factors. The U.S. is trying to limit China's presence near the canal, while China has criticized Panama's actions and has warned against unfair treatment of companies connected to China. The canal is vital, as it facilitates about 5% of global maritime trade.

Maersk has denied the accusations, stating that they do not believe they are at fault and will defend themselves in arbitration.

The arbitration between PPC and Maersk will be conducted alongside ongoing legal actions against Panama, and the process could take several years. The results may not only affect who controls these important ports but could also impact CK Hutchison's plan to sell its global ports business for $23 billion, which is now uncertain due to this conflict.