Iran’s de facto closure of the Straits of Hormuz and proposal to establish a fee regime, along with the Unites States’ imposition of a counter-blockade, has precipitated an urgent quest for a resolution of this crisis given the Strait’s importance. As a conduit through which one third of the world's liquefied natural gas and one quarter of total global oil production is transported, the issue is of immense global importance.
Despite previous reports that Tehran and Muscat were discussing new proposals for regulating maritime traffic in the Straits, the Sultanate of Oman has reaffirmed its commitment to the existence legal status of the Straits along with a rejection of proposals to impose fees on vessels transiting the waterway. As part of the search for a durable solution, it is necessary to examine the international legal regime relating to navigation in this case. This insight contends that while there are competing priorities for state sovereignty and the Law of the Sea, restrictions on the passage of vessels and the imposition of fees would not be justified under international law
The Law of the Sea and the Straits of Hormuz
As determined by the 1982 UN Convention on the Law of the Sea (UNCLOS), ‘third country’ shipping has the extensive right to transit international waterways such as the Straits of Hormuz. The Convention codified historical precedents that would support a case for free transit through strategically important channels as international customary law. In the 1949 Corfu Channel case, the International Court of Justice held that navigation through an international waterway linking the high seas in a time of peace required no authorisation provided that such passage was ‘innocent’. On the basis of Corfu Channel, it could be assumed the right to access an international strait took precedence of states’ territorial rights in such waterways.
Although nations retain sovereignty over their territorial seas and Exclusive Economic Zones, the assumption of the UNCLOS regime is that freedom of navigation in straits also serves the interests of the wider international community. The principle of ‘innocent passage’ was expanded in the 1958 Geneva Convention on the Territorial Sea and Contiguous Zone. UNCLOS, which subsumed the original Convention, subsequently reaffirmed the principle that ‘ships of all States, whether coastal or land-locked, enjoy the right of innocent passage through the territorial sea’.
Within Part III of UNCLOS, ‘Transit passage’ rights as set out in Articles 37 and 38 relate to ‘the exercise in accordance with this part of the freedom of navigation and overflight solely for the purpose of continuous and expeditious transit’. While littoral states have the right to regulate transit passage in respect to navigational safety, shipping traffic, pollution, fishing, and border and customs management, Article 44 provides that for vessels transiting international waterways, littoral states should not seek to ‘hamper’ or enact a ‘suspension’ of legitimate transit passage’.
The regime established by the Convention assumes the critical international importance of strategic waterways such as the Straits of Hormuz. Violations of UNCLOS Part III not only include closure, but any activity that obstructs transit passage and effects navigation. Articles 41 and 42 acknowledge littoral states’ sovereignty in designating sea lanes and ensuring maritime safety, fishing rights, environmental protection, customs and immigration among others. However, such rights do not, according to UNCLOS, assume the control of transit passage or the right to privilege some vessels flying under national flags while rejecting others.
Iran’s ‘closure’ of the Straits of Hormuz
The Islamic Republic of Iran has signed but not ratified UNCLOS is an important determinant factor. In its Declaration on signing the Convention, Iran pointed to ‘rights of the Coastal States to take measures to safeguard their security interests including the adoption of laws and regulations regarding…the requirements of prior authorization for warships willing to exercise the right of innocent passage through the territorial sea’. Tehran has thus consistently contended that the relevant UNCLOS provisions on transit and innocent passage did not codify customary international law or established practice. Seeing these aspects of the Convention as contractual between the signatories, Tehran has reserved its position on the right of ‘innocent passage’ subject to the state’s sovereign control and national security.
Iran’s reservation of its position on the right of ‘innocent passage’ implied such rights could be regarded as weaker than ‘transit rights’, given that a state could deny passage if it were deemed not to be innocent. Nevertheless, UNCLOS prohibits the unjustified prevention of ‘innocent passage’ and does not require any transiting vessel to give notification or seek authorization for their activity. More specifically, Article 34 provides that the exercise of sovereignty by states bordering straits is subject to the special regime set out by the convention and other international law principles.
However, Iran’s announcement of a closure of the Straits of Hormuz and proposed fee regime arguably goes far beyond the exercise of its sovereign and regulatory rights as provided for by UNCLOS. While Iran could also claim a right to self-defence in accordance with Article 51 of the United Nations Charter, previous international legal suggests that defensive measures undertaken by states must be dictated by necessity and proportionality. While necessity in such cases determines whether or not a defensive action was required to repel or prevent the attack, proportionality assesses whether the scope and effects of an action were required for defensive needs.
Even a justification based on an emergency and security requirements does not provide a legal basis for closure of the Straits. The downgrading of transit rights to a discretionary privilege, along with the charging of fees, seriously undermines the regime established by UNCLOS, given that the Convention is clear that littoral states should ensure that ‘laws and regulations shall not discriminate in form or in fact among foreign ships or in their application have the practical effect of denying, hampering or impairing the right of transit passage as defined in this section’The questions of obstructing transit rights and imposing tolls in the Straits of Hormuz raise important questions over how states can reconcile their sovereign rights with the principle of freedom of navigation. Iran’s attempt to impose discretionary control over the Straits of Hormuz while also proposing to collect toll payments raises fundamental issues. The Law of the Sea applied in this case as determined by precedent and UNCLOS suggests that Tehran’s actions in the Straits during the recent crisis undermines the existing legal regime for this globally important waterway.
Conclusion
Although Iran has consistently highlighted its reservations regarding UNCLOS, these do not justify the closure of the Straits or any attempt to charge transit fees. A system that would give Tehran discretionary control over transit according to whether or not they were hostile would run directly counter to the principle of free navigation as outlined not only by the Convention but also international legal precedent. In addition, it would be difficult for Iran to invoke Article 51 of the UN Charter to claim that restricted passage and a fee regime would be necessary and proportionate.
These international legal considerations still apply even in the context of Iran’s previous efforts to establish regional cooperative mechanisms such as the Hormuz Peace Endeavour (HOPE) proposed by Tehran in 2019, which aimed to establish a forum with the Arabian Gulf states to encourage inclusive intra-regional dialogue and cooperation. Such proposals underscore the importance of finding durable solutions for regional stability. However, ‘regionalisation’ through an instrument such as HOPE to manage the Straits of Hormuz would undermine the international legal principle of free navigation. Oman’s rejection of Iranian proposals to establish a bilateral transit and fees regime for the Straits illustrates the waterway’s importance as a key nexus connecting the Arabian Gulf countries to the high seas and the global economy.
