Iran is exploring the imposition of "access fees" on undersea internet cables traversing the Strait of Hormuz, a strategic waterway already at the center of global trade tensions. The proposal, first reported by the IRGC-linked Tasnim news agency, could generate up to €13 billion in annual revenue for Tehran, but it also raises serious questions for Europe's digital economy.
European companies from France, Italy, Greece, and the United Kingdom either own or co-manage at least four cables passing through the strait, according to the Submarine Telecoms Forum. Two are especially critical for connectivity between Asia and Europe: the Asia Africa Europe-1 (AAE1), with landing points in Crete, Bari, and Marseille, and the PEARLS/2Africa system, which runs beneath Sicily before reaching Genoa, Marseille, and Barcelona.
How the fees would work
The plan envisions three layers of impact. Logistically, cable operators would be forced to pay an "access fee" to Iran. From a regulatory standpoint, tech giants such as Google, Meta, Microsoft, and Amazon would need to comply with vaguely defined "laws of Iran." Additionally, Iran could take over cable maintenance in the strait and charge further fees.
Meredith Primrose Jones, head of geopolitics and security at risk advisory firm Leidra, told Europe in Motion that European financial institutions, cloud providers, and telecommunications firms rely heavily on low-latency submarine cable networks for banking, digital services, energy trading, and industrial operations. "Any increase in political risk around the Strait of Hormuz could raise connectivity costs, delay infrastructure projects, and create greater vulnerability for Europe's digital economy," she said.
This comes at a time when the European Union is already grappling with broader trade uncertainties, as seen in the EU's deliberations on tariffs and supplier rules amid a looming trade war with China.
Minimal impact or systemic risk?
Not all experts share the alarm. The International Cable Protection Committee (IPCC) downplayed the threat, noting that bandwidth traversing the Strait of Hormuz accounts for less than 1% of international bandwidth globally. "Many cable systems serving the Gulf region utilize branching architectures connected to larger international trunk systems," the IPCC said, adding that submarine cable faults are routine—150 to 200 occur annually worldwide, mostly from fishing or ship anchors rather than sabotage.
However, critics argue that the symbolic and legal implications could be far-reaching. Unlike Egypt, which charges fees for cables that physically cross its territory, most cables in the Strait of Hormuz do not enter Iranian waters. The United Nations Convention on the Law of the Sea (UNCLOS), which Iran signed but never ratified, protects maritime flows and international navigation. This legal ambiguity could embolden Tehran to test boundaries, especially given its recent establishment of a Strait of Hormuz Authority to levy transit fees on ships.
The broader geopolitical context adds urgency. Iran's IRGC-linked media have been actively pushing for fees on these cables, and the country's history of digital control—including an 82-day internet blackout that critics called digital apartheid—raises concerns about potential service disruptions.
For Europe, the stakes are clear: even a small increase in connectivity costs could ripple through financial markets, cloud services, and industrial supply chains. Yet the continent's existing backup systems, including terrestrial routes through the Gulf region, may provide a buffer. The question is whether Iran's move is a negotiating tactic or the start of a new era of digital chokepoint politics.
