Iran's parliament is reviewing a draft bill to ban U.S. and Israeli vessels from the Strait of Hormuz and impose fines of up to 20% of cargo value on violators. The proposal emerges amid ongoing negotiations between Iran and Oman to establish a managed shipping corridor. The United States has rejected the terms, asserting the strait is an international waterway that must remain free of tolls, approvals, or impediments.
Iranian parliamentary shipping bill
- ▪Under the proposed bill, the Iranian government would work with the country's armed forces to oversee navigation, monitor vessel movements, and ensure security and environmental protection in the Persian Gulf.
- ▪The draft bill proposes to deny transit permission through the Strait of Hormuz and the Persian Gulf to countries and private entities deemed responsible for causing damage to Iran until compensation is paid.
- ▪The draft shipping bill is under review by the Iranian parliament's National Security and Foreign Policy Committee, which has invited specialists to submit recommendations before finalizing the text.
- ▪Iran's parliament is reviewing a preliminary draft bill, titled "Strategic Action for the Security and Sustainable Development of the Strait of Hormuz and the Persian Gulf," to significantly tighten state control over navigation.
U.S. vessel transit restrictions
- ▪The draft bill proposes to bar vessels belonging to the United States, Israel, and other countries designated as hostile from transiting the Strait of Hormuz.
- ▪The proposed Iranian legislation would prohibit the transit of military and civilian cargo linked to Israel through the Strait of Hormuz.
- ▪The draft bill would ban vessels or cargo deemed to have supported operations against the Iran-led "Axis of Resistance" from transiting the Strait of Hormuz.
Cargo fine penalties
- ▪An Iranian Foreign Ministry source stated that transit fees under the proposed framework would depend on the scope of maritime services provided, such as insurance, bunkering, and environmental protection, rather than cargo-based transit tolls.
- ▪An alternative draft plan reported by NPR on August 6, 2026, proposed imposing fees of up to 7% of cargo value on commercial vessels passing through the Strait of Hormuz.
- ▪The draft bill proposes heavy penalties for violations, including fines of up to 20% of a vessel's cargo value.
Iran-Oman corridor negotiations
- ▪Iranian Foreign Ministry spokesperson Esmaeil Baghaei stated that negotiations with Oman are moving forward and a joint statement is in the final stages of review, provided third parties do not obstruct the process.
- ▪Iranian Deputy Foreign Minister Kazem Gharibabadi stated on August 5, 2026, that the path of understanding is strictly between Iran and Oman, denying that direct negotiations were ongoing with the United States.
- ▪Iran and Oman are negotiating a phased framework to manage navigation through the Strait of Hormuz, initially retaining existing shipping lanes before transitioning to a centrally managed corridor.
- ▪Under the proposed Iran-Oman framework, inbound vessel traffic would be managed by Iran, while outbound traffic would be jointly managed by Iran and Oman.
U.S. rejection of terms
- ▪A U.S. official rejected the proposed restrictions, stating that the Strait of Hormuz is an international waterway where no party controls the lanes, and any temporary routes must have no tolls, charges, or required approvals.
- ▪U.S. Central Command stated on August 4, 2026, that the southern route through the Strait of Hormuz, which passes through Omani territorial waters, remains free and open for all commercial vessels.
- ▪President Donald Trump stated on August 6, 2026, that negotiations to reopen the Strait of Hormuz were progressing and a deal could be reached soon, while asserting that the U.S. currently controls the strait via its naval blockade.
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