Panamanian Government action/initiative to facilitate transition to transfer of the Canal to Panama at end of 1999  

January 25, 1995 - Panama President Ernesto Pérez Balladares created the Transition Committee for the Canal transfer.

May 26, 1995 - Panama's Legislative Assembly gave second and final legislature approval to the Constitutional Amendment on the Panama Canal. The new Title XIV of Panama’s Constitution established the Panama Canal Authority as a profit-making institution (upon transfer of the Canal to Panama) and stipulated payments to the National Treasure.

In 1995, the PCC initiated a ten-month infrastructure audit by the U.S. Army Corps of Engineers to review the pace and substance of the Commissions’s ongoing capital program.  The Corps worked hand-in-hand with a blue-ribbon panel of Panamanian engineers.  This joint-ten-month study confirmed the overall sound condition of the Canal, and helped the PCC to refine the pace and priorities of its billion dollar Capital Improvement Program over the next seven years of operation (1996-2003).

The Canal achieved record cargo levels in fiscal years 1995-1996 – 190 million long tons in 1995 and over 198 million long tons in 1996.

February 10, 1996 - The Panama Canal Commission becomes a government corporation with the signing of Public Law 104-106 by U.S. President Bill Clinton.  

June 19, 1996 - The transit of the vessel Maersk Stafford marked the Canal's 800,000th transit.

July 1996 – The Canal Commission Board of Directors  approved the aggressive one-billion dollar Capital Improvement Maintenance and Modernization Program to modernize and improve the Canal infrastructure and ensure the waterway remains viable in meeting traffic demands and providing quality transit services while remaining competitive well into the 21^st Century. The program comprehensively addressed all aspects of Canal infrastructure.  The Canal modernization program, carried out simultaneously with the agency's traditional preventive maintenance program key to the successful operation of the waterway, began in 1996 after completion of the ten-month Corps of Engineers review (concluded in early 1996) of the Canal's physical plan to review the pace and substance of the Commissions’s ongoing capital program. The major parts of the Modernization and Improvement Program include the widening of Gaillard Cut (begun in 1992), increase in the towboat fleet, purchase of new and more powerful locks locomotives, modernization of the marine traffic management and locks control systems and replacement of 50,000 feet of locks tow track. Ultimately, with other improvements, by 2002 Canal capacity was expected to increase by twenty percent, and provide average Canal water time under twenty-four hours. Completion of the modernization and improvements program will increase Canal transit capacity by about 20 percent. This program will guarantee a modern waterway and sufficient capacity for the Canal to safely and efficiently meet projected traffic demand well into the twenty-first century

August 18, 1996 - Alberto Alemán Zubieta was sworn in as the second Panamanian administrator of the Panama Canal Commission succeeding Gilberto Guardia F.

The Canal achieved record cargo levels in fiscal year 1996 – over 198 million long tons, up from 190 million long tons in 1995.

January 1, 1997 – 8.2 percent increase in Panama Canal toll rates implemented, with the generated revenues used  to  fund the ongoing one-billion dollar Capital Improvement Maintenance and Modernization Program of the Panama Canal.

May 14, 1997 - Approval of the Panama Canal Authority Organic Law.

June 11, 1997 - Panama President Ernesto Pérez Balladares signed the Canal Authority Organic Law.

July 1, 1997 - Changes in ship measurement regulations entered into force.

July 7, 1997 - Jorge E. Ritter was appointed as the first Panamanian Minister for Canal Affairs.

September 7-10, 1997 - The Panama Canal Universal Congress was held in Panama City.

September 9, 1997 - The Panama Canal Interoceanic Museum in Panama City  was inaugurated (in the building in the old Casco Viejo section of the city which had housed the headquarters of the French Compagnie Universelle du Canal Interoceanique in the 1880s and the initial years of the U.S. Isthmian Canal Commission 1904-1913).

December 27, 1997 - The Panama Canal Authority was created to replace the Panama Canal Commission upon transfer of the Canal to Panama at the end of 1999.

In 1997, Panama Canal Commission awarded the Mitsubishi Corporation the contract for the manufacture of new locomotives (to pull ships through the locks). The first eight prototypes were delivered in August 1999, at a cost of $2.3 million each. After a 6-month test period, they began operating at Miraflores Locks.

The second group arrived in August 2001, at a cost of $1.9 million per unit. Sixteen of the 26 locomotives ordered are already in operation at Miraflores Locks. The remaining 10 arrived in March 2002 and joined the Miraflores fleet. The fleet has now increased to 100 units, and the full replacement of the fleet with this new type of locomotives is now under way  

January 1, 1998 – 7.5 percent increase in Panama Canal toll rates implemented, with the generated revenues used  to  fund the ongoing one-billion dollar Capital Improvement Maintenance and Modernization Program of the Panama Canal.

February 12, 1998 - First meeting of the board of directors of the Panama Canal Authority.

July 17, 1998 - First joint meeting of the boards of directors of the Panama Canal Authority and Panama Canal Commission.

July 31, 1998 - A group of 12 Panamanians completed training as mediators for labor-management disputes, to serve after the Canal transfer.

September 3, 1998 - Alberto Alemán Zubieta was sworn in as the first Administrator of the Panama Canal Authority (in addition to being Administrator of the Panama Canal Commision). In addition, the Panama Canal Authority board of directors approved the regulations on procedures to revise Panama Canal toll rates and admeasurement regulations.  

March 24, 1999 - Panama's Cabinet Council approved the toll rates that will become effective on December 31 and retain the pre-transfer toll structure.

April 12, 1999 - In accordance with the Canal's corporate objectives, the agency's purchasing authority was decentralized for better control over purchasing and acquisition processes.

May 27, 1999 - Ricaurte Vásquez, the Canal Commission's Financial Officer, was appointed Panama Canal Authority Deputy Administrator to begin serving on January 1, 2000.

June 3, 1999 - The Panama Legislative Assembly approved the Panama Canal Authority's budget for Fiscal Year 2000.

June 28, 1999 - The Panama Canal Authority distributed job offer letters to Canal employees.

July 1, 1999 - The Panama Canal Authority approves the post-2000 Labor Regulations.

August 1999 – The first eight prototype Mitsubishi locomotives (contracted in 1997) were delivered in August 1999, at a cost of $2.3 million each. After a 6-month test period, they began operating at Miraflores Locks.  The second group arrived in August 2001 -- see 1997 entry above for details). 

August 18, 1999 - The Panama Legislative Assembly approved the law establishing the new boundaries of the Panama Canal Watershed, based on the provisions of the Panama Canal Constitutional Amendment.

September 2, 1999 - Ricardo A. Martinelli took office as chairman of the board of the Panama Canal Authority and Minister for Canal Affairs replacing Jorge Ritter (following the installation on September 1, 1999, of Mireya Moscoso as President of the Republic of Panama 1999-2004).

October 4, 1999 - The Panama Canal Authority's Contracting Regulations are approved, marking the 21st and last agency regulation to be approved.

December 14, 1999 – Noon December 31 was mandated the official transfer date under the 1977 Panama Canal treaty in which the United States agreed to give Panama control of the 50 mile-long canal. However, because of concerns that the December 31 date would conflict with millennium observances around the world, a more elaborate affair to mark the transfer of the Canal was held December 14, and another ceremony -- "for the Panamanian people" (as  President Mireya Moscoso called it) was held at noon December 31.

(For details of the December 14 ceremony GO TO.)

December 31, 1999 - Canal was formally transferred to the Republic of Panama with the official  ceremony  held outside the Panama Canal Administration Building at Balboa Heights the morning of December 31, ending at noon.  Secretary of the Army Louis Caldera (representing President Clinton) – who was also the last Chairman of the Panama Canal Commission’s Board of Directors – headed the U.S. delegation which included U.S. Ambassador to Panama Simon Ferro.

(For details of the December 31 ceremony GO TO.)