NYT: Iran and Oman Secretly Discuss Toll System for Strait of Hormuz

The New York Times reported that Iran has discussed cooperating with Oman, a US ally, to establish a system to charge fees for vessels passing through the Strait of Hormuz, ignoring previous warnings from the Trump administration that no fees should be collected from ships passing through this critical international waterway. It is unclear whether these discussions will yield any concrete results, but the negotiations appear to indicate that despite President Trump's repeated claims that the war is nearing an end, there has been no progress between the US and Iran in ending a conflict that has severely damaged the global economy; at least in public, neither side has shown a willingness to compromise. After being attacked by US and Israeli forces in late February, Iran brought commercial traffic in the Strait of Hormuz to a near standstill, paralyzing international shipping and driving up energy prices. As the influence of the Strait of Hormuz on the global economy was established, Iranian officials began discussing how to maintain control over the waterway and use it to generate revenue. While discussing with Oman, the newly formed Persian Gulf Strait Authority in Iran stated on social media that it had "defined the boundaries of the management and supervision area of the Strait of Hormuz" and that passage would require the authority's permission. The Gulf of Oman is adjacent to the Strait of Hormuz, and one must cross the Gulf of Oman before reaching the strait from the east. Iran's state-controlled foreign media outlet, Press TV, recently reported that Iran has established a new mechanism to control maritime traffic passing through designated routes and charge fees for "professional services." Two people familiar with the discussions on the management of the Strait of Hormuz revealed that Iran does not intend to establish a simple toll system for passage; instead, Iran's negotiations with Oman explored a proposal to charge ships for services. According to two Iranian officials familiar with the negotiations who were not authorized to speak publicly, Oman initially rejected a joint partnership with Iran in the Strait of Hormuz but is now discussing the issue of revenue sharing. These officials said that Oman told Iran that after realizing the potential economic benefits of the fee system, it was willing to use its influence over Persian Gulf neighbors such as Bahrain, Kuwait, Qatar, Saudi Arabia, and the United Arab Emirates, as well as the United States, to promote the plan. Iran and Oman appear to be emphasizing that the proposed system would involve a "fee" for services, not a "toll" for passage, which is an important legal distinction. Under international law, charging a simple toll for vessels passing through a waterway could be illegal, but in some cases, it is permissible to charge for actual services provided to vessels, such as waste disposal at ports. However, experts point out that if this service fee system is just a change in name for a toll, it will still not be considered legal. The 1982 United Nations Convention on the Law of the Sea (UNCLOS) stipulates that as long as vessels comply with relevant regulations, procedures, and practices regarding safety and pollution control, they have the right to unimpeded passage through international straits. Iran is not a signatory to this convention and declares that it is technically not bound by it; Oman is a signatory. However, James Kraska, a professor of international maritime law at the U.S. Naval War College and a visiting professor at Harvard Law School, said that the rules and principles in the convention reflect customary international law and are binding on all countries, regardless of whether they are signatories. He pointed out that the regime of strait transit, which prohibits payment for passage, is "almost universally accepted" and that "for decades, Iran has acquiesced to this." Kraska noted that "they are trying to cleverly" incorporate their proposal into a legal framework. However, he said that charging a toll for a waterway that has long been free, while calling the toll a "service fee," is "just like the mafia collecting protection money."