CK Hutchison said its subsidiary Panama Ports Company (PPC) has started international arbitration proceedings against Panama after the country's top court annulled a concession allowing it to operate ports at the Panama Canal.

"The board strongly disagrees with the determination ⁠and corresponding actions in Panama," CK Hutchison said in a statement to the Hong Kong Stock Exchange.

"The group continues to consult with its legal counsel and reserves all rights, including recourse to additional national and international legal proceedings in the matter."

PPC said it has begun arbitration "after a campaign by the Panamanian state specifically against PPC and its concession contract, throughout a year marked by a series of abrupt actions by the Panamanian state, culminating in serious damages."

Panama's Supreme Court last week ruled the contracts violated the country's constitution by giving the company exclusive privileges and tax exemptions.

The Hong Kong and Macao Affairs Office criticised the court decision.

In a post on its official WeChat account, the office said the ruling ignored the facts, breached trust and seriously damaged the legitimate rights and interests of companies in the SAR.

The post also said the verdict reflected Panama's "complete subservience and obsequiousness to hegemony", adding that it severely damaged the country's relations with other international bodies.

It's not immediately clear how long the arbitration proceedings would take.

CK Hutchison has operated the ports for nearly three decades. The concession was extended for 25 years in 2021.

The two Panama Canal ports are at the heart of a US$23 billion buyout bid led by Blackrock and Mediterranean Shipping Company of CK Hutchison's 43 ports in 23 countries. (Agencies)