Panama Ports Company, S.A. (PPC), the operator of the Balboa and Cristobal port terminals under a concession contract approved by Law 5 of January 16, 1997, has issued a response to recent statements concerning its operations and obligations, according to CK Hutchison Holdings's release.
The company addressed claims related to its financial commitments and compliance with the contract and its addenda.
In 2005, PPC and the Panamanian State entered into an addendum to the concession contract, approved by Law 55 of 2005. Under this agreement, PPC committed to invest over $1,000 million balboas and pay an additional $102 million balboas for infrastructure inherited in 1997.
PPC states that it has invested $1,695 million balboas, exceeding both the original $50 million requirement and the $1,000 million stipulated in the addendum. A 2020 audit by the Comptroller General of the Republic, conducted over four months, confirmed these figures.
PPC disputes claims that it owes approximately $1,200 million balboas to the State, arguing that such statements fail to account for the addenda and distort the legal relationship between PPC and the State. The company notes that it has paid $668 million balboas to the State over 28 years, alongside $126 million balboas in dividends as the only port operator in Panama with a 10% State shareholding. PPC emphasizes that its tax exemptions, granted under the 1997 contract and addenda, align with those of other port operators in Panama.
The 2020 audit by the Comptroller General concluded that PPC is in substantial compliance with the concession contract, a finding supported by the Panama Maritime Authority’s 2021 certification.
PPC also highlights its contribution of more than $5,900 million balboas to the national economy, including payments to the State and investments.
The company states that its service provider contracts have generated significant savings over the past decade and that it has met all container movement payment requirements set by the Panama Maritime Authority at standard rates.
Panama Ports Company, S.A. is a port operating company responsible for managing the Balboa and Cristobal port terminals in Panama. Established under a concession contract approved by Law 5 of January 16, 1997, PPC is a subsidiary of Hutchison Ports, a global port operator based in Hong Kong. The company has operated these terminals for over 28 years, focusing on container handling and maritime logistics. It is notable for being the only port operator in Panama with a 10% stake held by the Panamanian State, which entitles the government to dividend payments.
The Comptroller General of the Republic is Panama’s government auditing and oversight body, tasked with ensuring transparency and accountability in public finances and contracts. It conducts audits of state-related entities and concessions, such as the one involving PPC. In 2020, it performed a four-month audit of PPC’s operations, concluding that the company was in substantial compliance with its concession obligations.
The Panama Maritime Authority is the governmental agency responsible for regulating and overseeing maritime activities in Panama, including port operations and compliance with concession contracts.