Recent events - Iran's closure of the Strait of Hormuz, attacks on commercial shipping by the Iran-backed Houthis in the Red Sea, and threats to vital submarine cables and offshore installations - expose the limits of the international law of the sea in protecting merchant shipping from hostile States and non-state actors.

With a substantial share of global seaborne trade having to pass through one or more maritime choke points, the question for the shipping industry is whether the international law of the sea is about to collapse, is merely passing through a period of turbulence and stress, or is undergoing a re-setting of customary international maritime law.

The UNCLOS Framework

The adoption of the United Nations Convention on the Law of the Sea ("UNCLOS") in 1982 created a comprehensive legal framework regulating territorial seas, exclusive economic zones (EEZs), continental shelves, international straits, the high seas and the settlement of disputes.

UNCLOS strikes a balance between the sovereign rights of coastal States and the interest of the international shipping community in maintaining accessible sea lanes across the world. Central to that balance is the freedom of navigation upon which global trade depends.

UNCLOS secures three principal navigational rights. First, foreign vessels enjoy the right of innocent passage through the territorial sea, provided that passage is not prejudicial to the peace, good order or security of the coastal State (Arts 17-19). Second, all ships enjoy the right of transit passage through straits used for international navigation (Arts 37-44). Third, on the high seas, vessels of all States enjoy freedom of navigation, subject only to the limitations of international law (Art 87).

The rationale of UNCLOS was to establish an international rules-based order as the foundation of global commercial shipping. It was never intended to reserve these fundamental rights to a handful of powerful States with formidable navies and missile capabilities. The shipping industry may be legally entitled to freedom of navigation, but international law cannot guarantee that a vessel will be able to exercise that right safely.

The Strait of Hormuz, the Red Sea and Merchant Shipping

Nowhere is this gap between legal entitlement and practical reality more evident than in the Strait of Hormuz and the Red Sea, where current geopolitical tensions pose a real threat to international shipping. The preferred route is increasingly the safest and most resilient one, rather than, as in the past, simply the shortest.

UNCLOS establishes a special regime of transit passage through straits used for international navigation, such as the Strait of Hormuz and the Bab el-Mandeb Strait at the southern entrance to the Red Sea. Article 38 grants all ships the right of transit passage, while Article 44 provides that States bordering straits shall not hamper or suspend it. Yet the existence of a legal right and the practical ability to exercise it are not the same. Instead of complying with these obligations, Iran has:

• closed an international strait vital to shipping in order to put pressure on Western economies, driving up the price of oil and energy and indirectly depleting world oil stockpiles;
• reportedly imposed transit levies on commercial vessels;
• attacked commercial vessels of certain neutral Western States that are not at war with it, in order to increase pressure on the Western world; and
• targeted certain ships because of a perceived connection with particular States and their close ties with the United States and/or Israel.

In the Red Sea, the Houthis have likewise attacked merchant vessels transiting the Bab el-Mandeb Strait. The ripple effects are felt in the cost of energy and shipping worldwide: higher insurance premiums, increased fuel consumption, longer transit times and higher charter rates.

The International Maritime Organization has condemned these attacks, while the United Nations Security Council has maintained reporting arrangements concerning attacks on merchant and commercial vessels.

The Enforcement Gap in International Law

These events expose a deeper, structural problem. International law differs fundamentally from domestic law. It has no standing enforcement mechanism comparable to that of a domestic legal order to ensure compliance with its rules, and treaty obligations bind only those States that have consented to be bound.

International law may create legal rights and establish institutions to settle disputes, but it is weak on enforcement, particularly given the realities of world politics and shifting alliances between States. The Strait of Hormuz illustrates the gap between legal rights and their enforcement. The legal position is complicated by the fact that Iran, although a signatory to UNCLOS, has not ratified it. Nonetheless, the right of transit passage is widely regarded as reflecting customary international law, which binds States irrespective of treaty ratification.

States may also seek to reconcile their strategic national interests with their international obligations, and there may be divergent interpretations of what is lawful and legitimate under international law - for instance, as to the scope of a coastal State's rights in its EEZ, or whether a State may impound a sanctioned vessel of another State.

Groups of States may act through organisations such as NATO and the EU to protect their interests. However, in the absence of an effective central world authority, the question often arises as to the point at which maritime law enforcement by one or more States becomes an unlawful use of force under the UN Charter.

Courts and tribunals under UNCLOS, such as the International Tribunal for the Law of the Sea (ITLOS) and arbitral tribunals constituted under Annex VII, may determine rights and obligations, but they possess no independent enforcement machinery comparable to that of a domestic court. This weakness is felt most acutely by small States, whose rights rest on legal recognition rather than physical power.

Under UNCLOS, a coastal State enjoys sovereign rights over its EEZ not because it can physically defend 200 nautical miles of sea, but because international law recognises those rights.

If physical control eventually becomes more decisive than legal entitlement under the Convention, UNCLOS will be further weakened. The danger is not merely that a particular award may be disregarded, but that States may resort to unilateral and arbitrary acts of force, or the threat of force, to secure their national interests.

The existence of a rule is therefore not enough. For the law to retain credibility, vessels must be able to rely upon it in their commercial operations. The South China Sea arbitration is another example of this problem. On 12 July 2016, an arbitral tribunal constituted under Annex VII of UNCLOS delivered its award in Philippines v China, largely in favour of the Philippines; China, however, continues to reject the award as null and void.

Implications for Malta

As a small island State at the centre of the Mediterranean, and as a major flag administration and maritime centre, Malta depends heavily on a rules-based maritime order that ensures legal certainty and freedom of navigation. It has a strong interest in the peaceful settlement of disputes, consistent navigation rights, the protection of civilian shipping and international cooperation against maritime threats.

Malta also made a seminal contribution to the development of the international law of the sea. In 1967, Arvid Pardo, Malta's Permanent Representative to the United Nations, proposed to the UN General Assembly that the seabed beyond national jurisdiction be recognised as the common heritage of mankind, initiating the negotiations that eventually led to UNCLOS.

Any weakening of this order would affect not only Malta's security and its maritime boundary disputes, but also its ship registry, while increasing the cost of shipping and of imported goods.

Conclusion

It would be premature to declare that UNCLOS has become irrelevant. It remains one of the most comprehensive and successful achievements of modern international law. States still invoke it, international institutions monitor threats to shipping, and governments generally argue about what the law permits rather than claiming that international maritime law has irrevocably broken down.

The real risk is that non-compliance becomes the norm: that the exercise of rights under the Convention comes to depend on whether a State has the military and naval power to guarantee those rights for its vessels, or that violations continue to yield strategic gains without consequences.

A further challenge is the extent to which international maritime law can constrain the major world powers, which seek to interpret and apply it principally in accordance with their immediate strategic interests. The concern is that international law becomes a tool for justifying power rather than limiting it. This would be harmful for shipping and for every State that requires certain and predictable access to the world's sea lanes. For a maritime nation such as Malta, the stakes could not be higher.

Karl Grech Orr, Consultant at Ganado Advocates

Valentina Refalo, legal intern at Ganado Advocates, contributed to this report

Disclaimer: This article is for informational purposes only and does not contain or convey legal advice. The information contained in this article should not be used or relied upon in regard to any particular facts or circumstances without first obtaining legal advice.