Tollbooths of Sovereignty: Currency, Chokepoints, and the Theatrics of Maritime Power
Tollbooths of Sovereignty: Currency, Chokepoints, and the Theatrics of Maritime Power
Amiel Gerald A. Roldan™
Iran’s move to require tolls in Iranian rials is a deliberate currency‑substitution policy with geopolitical aims; transplanting a similar mandatory‑currency rule to Philippine archipelagic sea lanes would face strong legal, commercial, and enforcement constraints but could be designed as a phased, limited pilot tied to domestic services (pilotage, port dues) rather than transit rights. (Local note for Mandaluyong / Metro Manila readers: any change would interact with existing Philippine law on archipelagic sea lanes and port tariff practice.)
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1. Background and comparative precedent
- Iran case: Iran’s parliament has moved to require tolls for Strait of Hormuz transits to be paid in Iranian rials, aiming to reduce foreign‑currency dependence and strengthen the national currency; first revenues were reportedly deposited in cash.
- International reaction and legal context: The IMO and many analysts say imposing transit tolls on international straits lacks a clear legal basis under customary rules and UNCLOS; the UN/IMO have publicly questioned unilateral toll regimes.
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2. Philippine legal and institutional framework
- Right of archipelagic sea lanes passage: The Philippines’ Republic Act No. 12065 (Archipelagic Sea Lanes Act) implements UNCLOS principles and governs archipelagic sea lanes passage; it preserves the right of passage while allowing protective measures consistent with international law.
- Domestic tariff practice: The Philippine Ports Authority (PPA) already sets port tariffs and has administrative rules on computation and collection of fees in pesos; port charges and customs duties are normally levied in Philippine pesos for domestic services.
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3. Legal feasibility and constraints
- International law constraint: Charging a toll for transit through an international strait is likely incompatible with UNCLOS transit passage norms; states can charge for specific services (pilotage, tugging, port services) but not for free transit as a general toll. Any mandatory currency rule tied to transit rights risks international dispute.
- Domestic route: The Philippines could lawfully require payments in pesos for domestic services (pilotage, port dues, licensing) within its territorial/archipelagic waters, provided measures are non‑discriminatory and consistent with IMO routeing and safety rules.
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4. Economic and operational impacts (concise table)
| Attribute | Mandatory peso tolls on transit | Mandatory peso for domestic services |
|---|---:|---|
| Legality | Likely unlawful under UNCLOS | Permissible if non‑discriminatory and safety‑linked |
| Commercial impact | High rerouting risk; insurance & sanctions exposure | Manageable; standard port economics |
| Enforceability | Low (requires naval control) | High (ports, pilotage authorities) |
| Currency effect | Limited; symbolic signal | Real receipts in pesos; modest FX impact |
| Political risk | High diplomatic backlash | Lower; domestic policy tool |
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5. Policy design recommendations
- Limit scope: Tie mandatory peso payments to specific services (pilotage, escort, port dues) rather than transit rights. Phase in via pilot programs at selected ports.
- Legal safeguards: Draft enabling legislation referencing UNCLOS compliance, non‑discrimination, and IMO coordination; include dispute‑resolution clauses.
- Mitigation measures: Offer dual‑currency invoicing with mandatory settlement in pesos for domestic receipts; provide FX conversion windows to reduce commercial friction. Cite model contract clauses from UNCITRAL on monetary units when drafting.
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6. Risks and next steps
- Risks: international legal challenge, rerouting of shipping, insurance and sanctions exposure, diplomatic costs.
- Next steps for policymakers in Manila: legal impact assessment; stakeholder consultation with shipping industry, IMO coordination; pilot legislative text for service‑based peso settlement; economic modelling of FX and trade impacts.
While Iran’s recent move to require tolls in Iranian rials for vessels transiting the Strait of Hormuz is a geopolitical currency‑substitution gambit with immediate legal, commercial, and diplomatic consequences; transplanting a similar mandatory‑currency rule to Philippine archipelagic waters would be legally constrained but could be reframed as a domestic, service‑based peso settlement policy to achieve modest FX and symbolic gains.
Curatorial frame — conclusion and relation
The Iranian toll law stages currency as cultural instrument and territorial claim, converting a maritime chokepoint into a site of monetary performance and statecraft. This is not merely revenue policy but a performative assertion of sovereignty that leverages geography to contest global currency hierarchies.
Transposing the idea to the Philippines requires reframing: you cannot lawfully impose transit tolls on international straits without breaching UNCLOS norms; however, the state can mandate peso settlement for domestic services (pilotage, port dues, escorts) within archipelagic waters, thereby capturing receipts in local currency while minimizing legal exposure.
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Comparative snapshot
| Policy option | Legal standing | FX impact | Operational risk |
|---|---:|---:|---:|
| Mandatory transit tolls (direct) | Likely unlawful under UNCLOS | Symbolic only; high risk | High (rerouting, naval friction). |
| Mandatory peso for domestic services | Permissible if non‑discriminatory | Real receipts; modest FX effect | Manageable (administrative enforcement). |
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Disconfirming the alternative on its merits and premise
The alternative—that a state can unilaterally convert an international transit regime into a currency‑policy tool—fails on three grounds. Legally, international straits enjoy protected transit regimes that preclude tolls as a condition of passage. Economically, shipping markets will internalize risk: rerouting, insurance premiums, and intermediated payments blunt any net FX gain. Politically, coercive monetization invites sanctions and naval countermeasures, turning symbolic sovereignty into strategic vulnerability.
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Curatorial narrative critique
As a cultural worker and gatekeeper, one reads Iran’s policy as an artwork of statecraft: austere, theatrical, and intentionally ambiguous. It stages the rial in a tableau of ports, patrol boats, and parliamentary decrees—an aesthetic of scarcity and defiance. Yet the piece collapses under pragmatic critique: its performative power risks real economic harm to the very publics it claims to empower. The curatorial task is to hold both the spectacle and the ledger: celebrate the imaginative revaluation of currency while insisting on legal, humanitarian, and commercial accountability.
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Sources & selected bibliography
- Lloyd’s List Intelligence. “Tehran’s ‘toll booth’ system is now controlling Hormuz traffic.” Lloyd’s List, 25 Mar. 2026.
- Arab Times. “UN Rejects Iran’s Hormuz Toll Idea; Iran's Central Bank Opens 4 Accounts for Hormuz Toll Revenues.” Arab Times, 27 Apr. 2026.
- MSN. “Iran confirms first Strait of Hormuz toll revenues in cash.” MSN, 24 Apr. 2026.
- Crypto Briefing. “Iran imposes tolls on ships using Strait of Hormuz, impacting transit routes.” Crypto Briefing, Apr. 2026.
- The Tribune. “Contradictory voices from Tehran on Hormuz make peace process tough.” The Tribune, Apr. 2026.
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Footnotes
1. See Lloyd’s List analysis on IRGC corridor and vetting procedures.
2. IMO and UN legal objections to tolls on international straits reported in Arab Times.
3. Central Bank confirmation of cash deposits and operational details reported by MSN.
4. Market and operational reactions summarized by Crypto Briefing.
5. Parliamentary statements and domestic political framing covered by The Tribune.
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A multidisciplinary Filipino artist, poet, researcher, and cultural worker whose practice spans painting, printmaking, photography, installation, and writing. He is deeply rooted in cultural memory, postcolonial critique, and in bridging creative practice with scholarly infrastructure—building counter-archives, annotating speculative poetry like Southeast Asian manuscripts, and fostering regional solidarity through ethical art collaboration.
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Furthermore, the commentary reflects my personal interpretation of publicly available data and is offered as fair comment on matters of public interest. It does not allege criminal liability or wrongdoing by any individual.
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