Statement of Chairman DiBella on China’s Detention of Panama-Flagged Vessels

The Federal Maritime Commission is closely monitoring how recent developments surrounding the Panama Canal terminals and China's retaliatory actions against Panama are affecting global shipping conditions. Laws administered by the Commission empower it to investigate whether regulations or practices of foreign governments result in conditions unfavorable to shipping in the foreign trade of the United States.

On January 30, 2026, Panama's Supreme Court invalidated the legal framework supporting Hong Kong-based CK Hutchison's concession to operate the Balboa and Cristóbal terminals on the Pacific and Atlantic sides of the Panama Canal. The decision followed an audit that uncovered alleged irregularities and raised questions about the concession's legal basis. Following the ruling, the Panamanian government appointed U.S. subsidiaries Maersk APM Terminals and Mediterranean Shipping Company's (MSC) Terminal Investment Limited as interim operators under 18-month agreements. CK Hutchison has rejected the ruling, initiated legal proceedings against the Panamanian government, and has steadily escalated its arbitration campaign - including new actions filed as recently as March 24, which seek more than $2 billion in damages.

In a parallel response, the Chinese Ministry of Transport summoned Maersk and MSC to Beijing for high-level discussions. Chinese government-owned carrier COSCO subsequently suspended its services at Balboa and rerouted operations.

China has now imposed a surge in detentions of Panama-flagged vessels in Chinese ports under the guise of port state control, far exceeding historical norms. These intensified inspections were carried out under informal directives and appear intended to punish Panama after the transfer of Hutchison's port assets. Given that Panama-flagged ships carry a meaningful share of U.S. containerized trade, these actions could result in significant commercial and strategic consequences to U.S. shipping.

The FMC is charged with ensuring an efficient, competitive, and economical transportation system for the benefit of the United States. Actions by foreign governments that detain, delay, or otherwise impede the movement of vessels documented under U.S. law- or vessels of other nations engaged in commerce with the United States- are inconsistent with the Commission's mandate to protect the reliability and integrity of America's global supply chain.

Laura DiBella is a Commissioner with the U.S. Federal Maritime Commission. The thoughts and comments expressed herein are her own and do not necessarily represent the position of the Commission.