A Panamanian court has annulled a port contract held by a Hong Kong-based company, leading President José Raúl Mulino to reassure the public that operations through the Panama Canal will remain uninterrupted.

On Thursday, the court declared that the port concession awarded to the Panama Ports Company, a subsidiary of Hong Kong’s CK Hutchison Holdings, was unconstitutional.

The ruling has been met with approval from the United States and criticism from China, according to reports from The Associated Press.

Gordon Chang, a noted China expert, commented to Fox News Digital in an email, saying, “Beijing plays hardball, but Trump plays harder. The American president has demonstrated to China who holds sway in the Western Hemisphere.”

An aerial shot of the port of Rodman in Panama City as seen on January 30, 2026. (Marin Bernetti/AFP via Getty Images)

Chang further remarked, “By removing Nicolás Maduro and his wife from Caracas, President Trump has effectively diminished China’s influence in Venezuela. With the revocation of Hutchison’s port concessions in Panama, it’s clear that Trump is resolute in eliminating China’s presence in the region, and other nations are beginning to align with the American president’s stance.”

Mulino said Friday that port operations at both ends of the canal will continue as the ruling is carried out, adding that Panama’s Maritime Authority will work with Panama Ports Company to keep the ports running, the AP reported.

Once the concession is formally terminated, Mulino said, a local subsidiary of Danish shipping giant A.P. Moller-Maersk will temporarily operate the ports while the government opens a new bidding process for a long-term concession.

Panamanian President José Raúl Mulino waves before giving a speech at his swearing-in ceremony at the Atlapa Convention Centre in Panama City July 1, 2024.  (AP Photo/Matias Delacroix)

The court decision followed an audit by Panama’s comptroller that identified irregularities in a 25-year extension of the concession granted in 2021, according to the AP.

The ruling aligns with long-standing U.S. concerns over China’s presence near the Panama Canal. 

Limiting Beijing’s influence in the region has been a priority of the Trump administration, and Panama was the first overseas stop this year for U.S. Secretary of State Marco Rubio, the AP reported.

Secretary of State Marco Rubio appears before the Senate Foreign Relations Committee Jan. 28, 2026. (J. Scott Applewhite/AP Photo)

“The United States is encouraged by the recent Panamanian Supreme Court’s decision to rule port concessions to China unconstitutional,” Rubio posted to X on Friday.

Panama Ports Company said it has not been formally notified of the ruling and argued it lacks legal basis, warning it could harm thousands of Panamanian families and undermine legal certainty. The Hong Kong government also rejected the ruling, according to the AP.