The current framing conflates the law with the commercial agreement, a simplification that amplifies the perceived lawfare impact and legal uncertainty.

Click here to read this article in Spanish/Español.

Alejandro Kouruklis, Director of Institutional Relations for Panama Ports Company (PPC), a subsidiary of CK Hutchison, has publicly responded in an interview to the Supreme Court of Justice ruling that declared the law approving PPC’s concession contract with the state unconstitutional. While expressing the company’s intent to cooperate with authorities, Kouruklis launched a detailed critique, framing the decision as an unprecedented and damaging act by the state against its own prior actions.

It is crucial to clarify a pivotal nuance in this legal conflict that the Supreme Court’s ruling did not directly declare the commercial contract with Panama Ports Company unconstitutional. Instead, it invalidated the specific law passed by the National Assembly that approved and gave legal force to that contract.

This important distinction, however, is often lost in public discourse, where both media coverage and government communications frequently frame the issue simplistically as “the contract” being struck down. The current framing conflates the law with the commercial agreement, a simplification that amplifies the perceived lawfare impact and legal uncertainty. This focusing on the “contract” rather than the “law of approval,” risks obscuring the core constitutional question, the legislature’s compliance with procedural and substantive legal norms, and amplifies the message of investor risk, as the practical outcome for the company remains the same: the legal foundation for its concession has been removed.

Kouruklis’s core argument is one of legal inconsistency and state self-contradiction. He emphasizes that the original 1997 contract and its subsequent amendments were drafted, negotiated, and approved by the state itself, specifically by the Executive Branch and the Legislative Assembly, through a public bidding process he describes as unique. “The State drafted that original contract, the State drafted the amendments, the Legislative Assembly approved them,” Kouruklis stated. Therefore, for the Judicial Branch, another branch of the state, to now declare those same acts unconstitutional represents the “State acting practically against its own acts.” He argues this creates profound legal insecurity, sending a message that laws ratifying contracts offer no long-term guarantee to investors, even after they have made multi-billion dollar investments based on those very laws.

Addressing the specific audit by the Comptroller General that alleged Panama sipposedly failed to receive approximately $1.337 billion in port revenues over 24 years, Kouruklis contends this is a fundamental misunderstanding and a misrepresentation of what the contract itself stipulates. He clarifies that the Comptroller placed responsibility on the state’s contract terms, not on PPC’s compliance.

According to Kouruklis, PPC has fulfilled all its financial obligations under the contract. The so called “missing” revenues, he argues, are not unpaid fees but a hypothetical calculation of a desired amount that was not in the actual contract, the amount was what some wanted to have collected under a different contract structure. He asserts the real obligation was investment, pointing out that PPC invested $1.8 billion against a $1 billion requirement by the law, — $0.8 billion more than the required amount — transforming the ports into assets now as “The ports of Balboa and Cristóbal are now coveted by other companies precisely because of that investment,” he noted. The careful distinction between the Comptroller’s audit “findings” and PPC’s contractual compliance is a key tactical move to undermine the ruling’s factual premise in the public sphere.

Regarding the automatic 25-year extension of the concession in 2021, which the Court also found unconstitutional by proxy as the law was the thing targeted, Kouruklis maintains it was contractual and automatic, not subject to the re-approval requirements established for new concessions by the 2008 General Ports Law. He states that even if there were disputes over the extension, the contract and the law provide mechanisms like dialogue or arbitration, not constitutional nullification, to resolve them, as “this is not justification for declaring a contract unconstitutional,” he asserted.

Kouruklis warns of severe commercial and operational consequences stating that a planned sale of the ports is now “tremendously affected,” and while PPC will cooperate in a transition to ensure port continuity, the situation is operationally complex. He notes that critical infrastructure like cranes, vehicles and the proprietary operating system software are private assets of CK Hutchison, essential for port functionality and daily operations, and a transition would take months. Despite this, his tone towards the Mulino administration is cautiously diplomatic, welcoming its commitment to worker rights and service continuity and expressing a preference for dialogue over protracted litigation, while firmly reserving the company’s right to pursue all legal avenues, noting that international and local lawyers are analyzing the ruling for potential actions.

Kouruklis’s public statements are a form of strategic signaling, reassuring the global maritime community of PPC’s cooperative stance, applying diplomatic pressure on the Panamanian government by invoking a recent mining case, mentioning possible reputational risk, bringing up comparisons to “dictatorial” regimes, and setting the public narrative that PPC is a victim of state capriciousness he amplifies a perceived risk for foreign capital in Panama.

Hiding the Lawfare Under the Protocol Rug

The state, via the Comptroller and the Supreme Court, has wielded constitutional review as a tool to unilaterally alter the fundamental terms of a commercial relationship, effectively using legal mechanisms to achieve a political or economic rebalancing. The state’s argument rests on constitutional supremacy and public interest, while PPC’s defense is based on contractual sanctity, legitimate expectations, and legal stability. Kouruklis’s retort that the state is “acting against its own acts” shows the asymmetry in this Donroe Doctrine lawfare as the state can repudiate its own prior legal acts through a separate branch of government, leaving the counter-party with no procedural defense within the original contractual framework. The Mulino administration’s call for dialogue attempts to de-escalate the lawfare into a negotiated settlement, recognizing that a full legal victory in court could still result in a costly international arbitration defeat.

*

Click the share button below to email/forward this article. Follow us on Instagram and X and subscribe to our Telegram Channel. Feel free to repost Global Research articles with proper attribution.

Miguel Santos García is a Puerto Rican writer and political analyst who mainly writes about the geopolitics of neocolonial conflicts and Hybrid Wars within the 4th Industrial Revolution, the ongoing New Cold War and the transition towards multipolarity. Visit his blog here. 

He is a Research Associate of the Centre for Research on Globalization (CRG). 

Featured image is from the author

Global Research is a reader-funded media. We do not accept any funding from corporations or governments. Help us stay afloat. Click the image below to make a one-time or recurring donation.