Ship Calm & Carry green – The Maritime iranian tax to cross the Hormuz Straight

Ship Calm & Carry green – The Maritime iranian tax to cross the Hormuz Straight

Can the maritime iranian tax to cross the Ormuz straight be legally characterised as criminal?

Introduction

The payment of a transit tax is contrary to the international law of the sea, but also, in another essential respect, contrary to the international law established for the purpose of combating terrorism throughout the world (A).

It happens that Iran is close to numerous terrorist groups and is even considered to be a terrorist State itself by some (B).

Consequently, the payment of an illegal tax to this specific State may give rise to sanctions (C).

What is The current international legal framework combating all terrorist acts and groups worldwide ?

 

The United Nations (UN) deploys legal instruments through which its Member States undertake to combat terrorism, including:

  • Resolutions and decisions of the United Nations General Assembly (UNGA)
  • Resolutions of the Security Council (UNSC)

It is important to emphasize that resolutions and decisions of the UNGA have the same legal status:

  • They reflect the views of Member States and provide recommendations, but are not binding, except in certain cases.
  • The Global Counter-Terrorism Strategy adopted by a UNGA resolution therefore calls upon States not to finance terrorism, directly or indirectly, without creating a worldwide legal obligation.

 

Conversely, decisions of the United Nations Security Council are binding.

United Nations Global Counter-Terrorism resolutions and decisions

The Plan of Action of the UN Global Counter-Terrorism Strategy (Resolution A/RES/60/288 of 8 September 2006) provides:

“We resolve to undertake the following measures aimed at addressing the conditions conducive to the spread of terrorism, including by depriving terrorists of the means to carry out their attacks […]:

1. To refrain from organizing, instigating, facilitating, participating in, financing, encouraging or tolerating terrorist activities […].”

Over the years, the United Nations has designed an important set of legislation aiming to tackle firmly global terrorism financing:

UN General Assembly (UNGA) Instruments:

  • UN Global Counter-Terrorism Strategy (Adopted under UNGA Resolution A/RES/60/288)

UN Security Council (UNSC) Resolutions:

  • UNSC Resolution 1373 (2001) (On preventing and suppressing the financing of terrorism, criminalizing terror funding)
  • UNSC Resolution 2161 (2014) (Obligations to prevent financial support to ISIL, Al-Nusra Front, and Al-Qaida-affiliated entities)
  • UNSC Resolution 2178 (2014) (Criminalizing the financing of foreign terrorist fighters)
  • UNSC Resolution 2199 (2015) (Reaffirming obligations under Resolutions 1373 and 2161)
  • UNSC Resolution 2462 (2019) (Reaffirming and expanding obligations on countering terrorism financing, including indirect support)

The 1999 International Convention and the Role of the Financial Action Task Force (FATF)

In addition to Security Council resolutions, the International Convention for the Suppression of the Financing of Terrorism of 9 December 1999, which entered into force on 10 April 2002:

  • Prohibits financing terrorism
  • Is binding on 191 States Parties, representing the majority of maritime States worldwide

Role of the FATF:

The FATF requires ratification of the 1988 SUA Convention and its Protocol on fixed platforms (under Recommendations 5 and 36), which criminalize terrorist acts against ships, including their financing, and mandate full implementation of the Terrorism Financing Convention.

European law

The Council of the EU adopted on May 2024 a new regulatory package, including the European Anti-Money Laundering and Counter-Terrorism Financing Authority (AMLA) and directly applicable legislative acts for all 27 member states.

It therefore follows from public international law and European Union law that the prohibition on financing terrorist activities worldwide is a legal obligation incumbent on the majority of States.

It is consequently also a legal obligation incumbent on economic operators incorporated in those States.

Iran, a specific international actor marked by its support for terrorism 

Following the political agreement reached by the EU Foreign Affairs Council on 29 January 2026, the Council formally designated the Islamic Revolutionary Guard Corps (IRGC) as a terrorist organisation on 19 February 2026.

The IRGC is subject to restrictive measures under the EU sanctions regime:

  • All funds and financial assets of the IRGC within EU Member States are frozen.
  • EU operators are prohibited from making funds or economic resources available to the IRGC.

In Iran, the IRGC is responsible for preserving the authority of the Supreme Leader and ensuring the survival of the regime. The Iranian State directly finances this organisation.

 

For EU member states, financing the Iranian State = directly or indirectly financing terrorist activities

Characterisation of Iran as a terrorist State:

As of June 2026, only a few States or jurisdictions worldwide characterise Iran or the IRGC as terrorist: the United States, the European Union, Canada, Australia, Albania and Argentina.

Support of Iran for Armed groups:

Iran’s support for armed groups classified as terrorist organizations by other States worldwide takes the form of sustained financial and logistical support. Many of these groups are classified as terrorist organizations and are subject to strict controls.

Consequence for shipowners:

Shipowners whose vessels fly the flag of one of these countries and who pay the Iranian tax could be found guilty of terrorism financing.

Possible sanctions for shipowners who pay the Iranian passage tax 

In order to criminalise the financing of terrorism, the States Parties have transposed the prohibition on terrorist financing into their domestic law, thereby making it possible to impose sanctions on those who breach it.

Example: For vessels registered under the Luxembourg, French or Belgian flag, the financing of terrorism is clearly prohibited by law.

  • Belgian Criminal Code, Article 140 et seq.
  • French Criminal Code, Article 421-2-2 et seq.
  • Luxembourg Criminal Code, Article 135-1 et seq.

Sanctions can result in :

  • Financial fines
  • Administrative fines
  • Freezing of funds, assets, or other economic resources
  • Prohibition or restriction on engaging in any financial activities
  • Imprisonment

Legal framework applicable to flags of convenience and consequences

What is the position for vessels flying the flag of Liberia, Panama, the Marshall Islands or Malta (48.6% of the world fleet) ?

 

Liberia: Criminalises the financing of terrorism :

  • Anti-Money Laundering and Countering the Financing of Terrorism Act (2021)
  • Targeted Financial Sanctions Act (2017)
  • Anti-Terrorism Act, as amended

Panama: Criminalises the financing of terrorism in its Criminal Code, in the chapter devoted to terrorism.

Marshall Islands: Criminalises the financing of terrorism in its Counter-Terrorism Act (2002), Section 120.

Malta: Criminalises the financing of terrorism under:

  • Criminal Code (Chapter 9)
  • Prevention of Money Laundering Act (Chapter 373)
  • Prevention of Money Laundering and Funding of Terrorism Regulations

Consequences for shipowners:

It therefore appears that more than half of the vessels registered worldwide are subject to criminal-law obligations to comply with the prohibition on directly or indirectly financing terrorism.

Accordingly, they would breach that prohibition by financing the Iranian regime through the voluntary payment of this illegal tax.

Risk of criminal prosecution, particularly since ignorance of the current geopolitical situation cannot be invoked as a good-faith mistake

 

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