Suez, Panama canals charge for transit — why can't Hormuz?
Iran has been widely condemned for demanding up to $2 million for vessels to ship through the Strait of Hormuz. DW explores the reasons why
Iran has been widely condemned for demanding up to $2 million for vessels to ship through the Strait of Hormuz. DW explores the reasons why Egypt can charge for the Suez Canal and Panama for its waterway, but Iran can't. The Iranian regime has been accused of extortion and threats to global energy security after reports emerged that Tehran has begun charging up to $2 million (€1.7 million) per vessel for "safe passage" through the Strait of Hormuz. The strait is the world's most indispensable energy corridor, squeezed between Iran and Oman. Before the Iran war, it carried one-fifth of all the oil and gas consumed worldwide. Iran's government has justified the fees as war reparations for damage suffered caused during US-Israeli attacks on the country, as well as payment for "navigational services," environmental protection and enhanced security. The government announced that it was drafting a joint protocol with Oman to require ships to obtain permits before transiting the strait. While some Asian shipping firms and smaller operators have quietly coughed up, major global players are refusing to pay, while the Institute for the Study of War (ISW) think tank labeled the tolls a maritime "protection racket." The United States and China agreed on their joint opposition to the levy, Reuters news agency reported earlier this month, citing a US State Department official. Gulf countries have also rejected the move. Maritime experts insist there are good reasons why Iran cannot charge fees in Hormuz when other vital chokepoints — like the Suez Canal and Panama Canal — levy similar tolls for passage through their waterways.
Can Iran control flow of data along with flow of oil? To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video What are the rules for straits? Under international maritime law, natural straits used by shipping are governed by a special set of rules designed to protect global trade and freedom of navigation. The United Nations Convention on the Law of the Sea (UNCLOS) gives vessels — and aircraft — from all nations the right of so-called transit passage through international straits that connect two parts of the high seas. To qualify for transit passage, a vessel must move through the strait without delay and without anchoring except in emergencies. Those transits must be allowed to happen without interference from the coastal state, the UNCLOS rules state. Coastal states can charge only limited service charges, including pilotage and towing. Shipping in the Strait of Hormuz has been restricted for more than 90 days Image: REUTERS Why can canal operators charge fees? Canals like Suez and Panama are man-made waterways built, owned and maintained by sovereign states at enormous cost. Egypt generates annual revenues of around $4 billion in fees for ships transiting the 193-kilometer (120-mile) Suez shortcut. The 1888 Constantinople Convention, signed by major powers at the time, explicitly allows the Egyptian government to levy tolls to cover maintenance, operations and upgrades. Meanwhile, the Panama Canal Authority, which runs the US-built canal on behalf of Panama, is also permitted to charge fees under separate treaties.
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