Construction Law and the expansion of the Panama Canal

Derecho de la construcción en Panamá : construction law in Panama

In 2016, the Panama Canal, an engineering marvel and global trade hub since its opening in 1914, inaugurated its massive expansion. This ambitious project doubled the canal capacity and posed complex challenges in engineering, environmental, logistical, and construction law in Panama. 

Infrastructure lawyers had to overcome the challenges of international maritime law, environmental regulations, and construction contracts to ensure smooth progress and completion of this colossal project.

Panama Canal expansion involved more than building new locks. It also implied intricate legal work to manage national and international contracts and ensure their compliance. Infrastructure lawyers were essential in drafting the contracts that guided relationships between stakeholders, from construction companies to government entities. 

The first challenge was the holding of the Referendum of Approval of the expansion of the Panama Canal, which was held on October 22, 2006, presenting the Panamanian people with the option of accepting or rejecting the expansion because the Political Constitution requires it according to its article 325, which dictates:

“The international treaties or agreements concluded by the Executive Body on the Canal of locks, its adjacent area, and the protection of said Canal, as well as the construction of a Canal at sea level or a third set of locks, must be approved by the  Legislative Body. After their approval, it will be submitted to a national referendum, which may be held after three months following legislative approval.”

Following the approval of the expansion, construction law in Panama professionals were responsible for ensuring that the contracts with the different construction companies and contractors were strong enough to develop a construction project of this magnitude without legal setbacks.

The benefit of multi-front expertise

The expansion of the Panama Canal is located in one of the regions with the highest and most extraordinary biodiversity in the world. Therefore, preserving the environment was a key concern for Panamanians and vital for the operation of the Canal.

The lawyers for the canal expansion worked closely with the Panama Canal Authority to carry out the necessary environmental impact assessments and obtain the required permits as part of a project that prioritized the environment.

On the other hand, the lawyers were also at the forefront of the re-evaluation of current maritime regulations and conventions due to the introduction of new routes and ships with greater capacity called Neopanamax.

Supporting infrastructure development in Panama

The story of the expansion of the Panama Canal is a story of success, precision, and legal skill where legal professionals bridged the gap between visionary engineering and national and international legal regulations.

Mónica Castillo Arjona – Law Firm has become synonymous with excellence in legal advice, particularly in the field of infrastructure in Panama. With a deep knowledge of the local and international legal landscape, we are allies for business owners and entrepreneurs who develop their construction projects in the country.

Our team of lawyers specialized in construction law in Panama provides comprehensive support for companies involved in infrastructure, such as architects, engineers, and legal professionals, which participate in developing projects that require applying strict environmental, labor, and legal standards that govern the industry in the country.


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