By: Kamyar Mehdiyoun
© American Journal of International Law



In the aftermath of the breakup of the Soviet Union and the birth of new sovereign nations bordering the Caspian Sea, the legal status of the sea has emerged as one of the most contentious international problems facing the region. The discovery of large offshore oil and gas deposits in the area has added urgency to the need to resolve the twin issues of the legal status of the sea and the corresponding mining rights.1

The Caspian, the largest inland body of water in the world, is approximately the size of Japan.2 The south Caspian is the deepest part and contains the most productive oil and gas fields. The oilproducing area of the south Caspian that holds the most promise extends along a narrow structural zone across the sea from the Apsheron Peninsula in Azerbaijan to the Peri-Balkhan region of western Turkmenistan.3

As a result of the breakup of the Soviet Union in 1991, five littoral states now border the sea: Russia, Kazakhstan, Turkmenistan, Iran, and Azerbaijan. One author has calculated each state’s share of the coastline as follows: Russia, 18.5 percent; Kazakhstan, 30.8 percent; Turkmenistan, 16.8 percent; Iran, 18.7 percent; and Azerbaijan, 15.2 percent.4 Lacking any direct outlet to the ocean, the Caspian is linked to the Black and Baltic Seas through the Volga River and a series of canals and other rivers. The water level of the Caspian has fluctuated in recent decades but still lies well below sea level.5 The sea contains approximately fifty islands.6 An authority on Soviet and Russian law of the sea has observed that in geological terms there is some doubt whether the Caspian Sea has a physical continental shelf. Instead, the area may be viewed as being only a depression in the continental landmass.7

The characteristics of the Caspian have prevented its ready geological and legal classification. It has alternatively been called a lake, an enclosed sea, a closed sea, an inland sea, a sea, and, finally, a “unique body of water.”8 The labeling is significant because the category determines which body of law applies to delimitation of the waters and the resources of the subsoil.9


International Treaties

One of the main objectives of tsarist Russia in the beginning of the nineteenth century was to expand its territory southward. In the Caucasus this southward drive provoked a series of wars between Russia and the declining kingdom of Persia (now Iran). Persia’s defeat in these wars resulted in the conclusion of two treaties, which, in addition to fixing the Russo-Persian land borders, regulated shipping rights in the Caspian.10 The first of these treaties, the Golestan Treaty of 1813, barred Iran from deploying its naval forces in the Caspian.11 The Turkmenchai Treaty, concluded in 1828, reiterated these limitations on Persian naval shipping.12

The legal regime regarding the Caspian remained unchanged until after the Russian Revolution of 1917. The 1921 Treaty of Friendship between Iran and Russia abrogated all prior treaties and restored Iranian shipping rights in the Caspian.13 Under the Treaty of Establishment, Commerce and Navigation concluded by the two states on August 25, 1935, each party “reserv[ed] to vessels flying its own flag the right to fish in its coastal waters up to a limit of ten nautical miles.”14 They reaffirmed the 10-mile fishing zone in the Treaty of Commerce and Navigation of March 25, 1940.15/ Beyond the 10- mile zone, fishing was allowed only to Soviet and Iranian nationals.16 The Treaty was silent on seabed mining.17 Significantly, the Treaty and the notes attached to it contained several references to the Caspian as a “Soviet-Iranian sea.”18 A more recent comprehensive boundary treaty, concluded in 1954, determines the land border between the two sides without delimiting the sea boundary across the Caspian.19


Municipal Law and State Practice

Soviet jurists viewed the legal regime of the Caspian as that of a closed sea.20 The Russo-Soviet doctrine of the closed sea is highly controversial and aims at limiting commercial and military activities in certain bodies of water to nationals of littoral states.21 In addition to the Caspian, the Black and Baltic Seas were also usually declared to be closed seas by the Soviets.22 This designation, especially as it applied to the latter two seas, was contested by the Western powers, which successfully barred its inclusion in the draft 1958 Geneva Convention on the High Seas.23

In the case of the Caspian, however, Iran’s municipal law also recognized the Caspian as a “closed sea.” The Iranian Law on the Exploration and Exploitation of the Continental Shelf, dated May 19, 1949, effectively asserted national jurisdiction over the natural resources of the seabed and subsoil of the continental shelf in the Persian Gulf and the Gulf of Oman. The law, however, was silent on the Caspian Sea.24 Six years later, a note was added to Article 2 of the law that read in its entirety: “As regards the Caspian Sea, the rules of international law relating to closed seas are applicable.”25

In light of the contested nature of the doctrine of closed seas, however, the intent of the Iranian legislature remains unclear.26 It is noteworthy that the lawmakers recognized that the terms of the Soviet-Iranian Treaty of 1940 did not apply to the delimitation of the continental shelf and subsoil resources of the Caspian. Thus, the legislation neither mentioned the 1940 Treaty nor applied the shared-use/ownership principle. Given Soviet technological superiority in the exploration and exploitation of subsoil resources, one can easily understand Iran’s reluctance to “share” the Caspian with its northern neighbor.

In 1949 the Soviet Union started to exploit the Caspian hydrocarbon resources offshore. The operations were centered in what is now the coastal region of Azerbaijan.27 Before the Soviet Union switched its exploration and exploitation efforts to Siberia in the 1960s, the fields off Azerbaijan were its most productive.28 There is no evidence that the Soviet Union ever consulted Iran on its Caspian oil operations.29 Iranian commentators point out that Iran acquiesced in these unilateral Soviet actions, which in the Iranian view breached the “common sea” principle of the 1940 Treaty, out of reluctance to antagonize its powerful northern neighbor by lodging a diplomatic protest.30 As will be discussed below, post-Soviet Russia and Islamic Iran have both supported the position that the “common sea” principle has always governed the Caspian. The practices of the littoral states, however, weaken this claim.



The Iranian arguments may be summarized as follows. Because of its unique geographical characteristics, which distinguish the Caspian from similar bodies of water, the international law of the sea is not applicable to it.31 Instead, until the five littoral states jointly devise a new legal regime for the sea, the Soviet-Iranian Treaties of 1921 and 1940 must govern.32 The silence of these Treaties on mining rights must be seen in the light of the inadequacy of offshore mining technology at the time.33 The intent of the parties, however, to own and use the Caspian on a shared basis can readily be seen from the repeated references in the Treaties to the Caspian as a “Soviet-Iranian sea.”34

The Iranian position may best be understood by analytically separating two distinct issues. The first issue is, How should the littoral states approach the task of mineral exploitation in the Caspian before the legal regime of the sea has been determined?35 Here, Iranians emphasize that the littoral states must agree upon a temporary minerals regime by consensus.36 Thus, even if these states later decide not to share the mineral resources of the Caspian and instead divide the sea among themselves, they should all agree in the meantime on any plans to explore and exploit those resources.37 The second issue is the Iranian argument that, given the unique geographical and ecological conditions of the Caspian, the most sensible legal regime is one based on the principle of “condominium” or res communis.38

Economic, political, and geographical realities underlie Iran’s opposition to dividing the Caspian seabed resources among the littoral states on a sectoral basis. Economically, Iran is not in a position to divert its scarce resources to oil exploration and production in the Caspian.39 Iranian politicians who support foreign participation in energy projects not only are hampered by conservative domestic political forces, but also must overcome foreign legal obstacles to such ventures.40 Moreover, Iran appreciates the geological fact that whatever oil reserves it may have in the southern Caspian would be situated in some of the deepest, hence most difficult to mine, areas of the sea.41 Finally, the twin principles of condominium and consensus enable Iran to oppose the presence of Western powers in the Caspian.42

Azerbaijan’s adamant refusal to accept “shared ownership” and Russia’s shifting position vis-à-vis the principle of condominium isolated Iran among the littoral states.43 In September 1998, Iran officially announced its acceptance of the principle of sectoral division, on the condition that a single division scheme be applied to both the waters and the seabed.44 In addition, Iran has argued that such a division must be equal (i.e., that each littoral state’s share must be 20 percent of the waters and the seabed).45



Azerbaijan’s position on the Caspian legal regime may be summarized as follows. Division of the sea among the littoral states is supported by international practice and rules of international law.46 The waters, as well as the seabed, must be divided by means of an equidistant line.47 The Soviet-Iranian Treaties of 1921 and 1940 regulate only navigation, fishing, and border-guard practices and are inapplicable to the mining regime.48 Azerbaijanis also argue that the history of state practice prior to 1991 supports their position for the division of the Caspian into national zones. They point out that by 1970 the Soviet Union had divided the Caspian into Iranian and Soviet zones by drawing a boundary line across the sea between Astara and Husseingholi; it then further divided the Soviet sector among Azerbaijan, Russia, Kazakhstan, and Turkmenia.49 Azerbaijanis claim that this inter-republic division was approved by Russian Prime Minister Viktor Chernomyrdin in 1993, two years after the breakup of the Soviet Union.50 Furthermore, Azerbaijani officials point out that the sovereignty of Azerbaijan over its portion of the Caspian is enshrined in its new constitution and that the issue of sharing the sea is therefore moot.51

Azerbaijan’s insistence on sovereignty over its portion of the Caspian is based on economic, geographic, and political considerations. To begin with, if the Caspian is divided, some of its largest oil and gas reservoirs would be situated in the Azerbaijani zone.52 In addition, these reservoirs are in relatively shallow portions of the Caspian, allowing easy offshore drilling.53 In contrast to Iran, Azerbaijan has placed exploitation of these oil fields at the top of its agenda. Azerbaijan believes that lack of clear title over these reservoirs makes the task of attracting foreign investment in its energy projects more difficult. Finally, as a fledgling U.S. ally, Azerbaijan does not wish to involve Iran in deciding when and how to develop its Caspian resources.54 The United States fully supports Azerbaijan’s legal and political stance on the Caspian.55

In August 1998, Azerbaijan announced that Russia, a longtime supporter of the principle of shared ownership of the Caspian, had now agreed to divide the seabed on the basis of an equidistant line.56 In February of that year, Azerbaijan and Turkmenistan had arrived at a general understanding on the division of the seabed according to an equidistant line.57 These two states differed, however, on how the equidistant line should be drawn.58 They have also clashed over the ownership of two fields in the Caspian.59



The Russian position on the mining regime in the Caspian Sea reflects the constant tension between the Foreign Ministry, on the one hand, and the Ministry of Fuel and Power, allied with powerful oil companies such as Lukoil, on the other. Yakov Pappe, a Russian expert, described the companies’ views as follows:

The oil people do not support any attempts by Russia to pressure its Southern neighbors, in particular declaring the former Islamic republics of the USSR a zone of Russia’s special interest. They do not support it because they don’t believe in the effectiveness of such measures. For them it is important to have the possibility of expansion now, while not everything has yet been divided. That is why the oil people want to respect the national aspirations of other new independent states, while at the same time expecting that these states would decide to make maximum use of the scientific, technological, human potential still possessed by Russia.60

The first signs of a rift in the Russian government emerged in 1994. In April of that year, while the Azerbaijani government was negotiating an $8 billion deal to develop its oil resources in the Caspian with a mainly Western consortium, the Russian Ministry of Foreign Affairs reacted by sending a note to the British Embassy in Moscow. The letter stated in part: “Any steps by whichever Caspian state aimed at acquiring any kind of advantages with regard to the areas and resources . . . cannot be recognised . . . [and] . . . any unilateral actions are devoid of a legal basis.”61 The Foreign Ministry’s tone became more threatening in a letter submitted to the UN Secretary-General later that year, which stated that Russia would take all necessary measures to restore the legal order of the Caspian, and that the responsibility for any adverse consequences, including “major material damage,” rested with those who resorted to unilateral actions in disregard of international agreements.62

The early Russian position stated in the above letter to the United Nations and in other documents may be summarized as follows. The Caspian Sea was a landlocked body of water and thus the norms of the international law of the sea, including the territorial sea, the exclusive economic zone, and the continental shelf, were not applicable to it. The legal regime of the Caspian was still governed by the Soviet-Iranian Treaties of 1921 and 1940, which provided for joint utilization. All the coastal states were bound by these agreements, not only because as successor states they had inherited the treaty obligations of the former unitary state, but also because all five of them had signed the “Alma Ata Declaration” to the same effect in 1991.63 By virtue of the emergence of three new littoral states, the Caspian legal regime must be updated. In the meantime, however, any utilization of the Caspian’s water and subsoil resources that affected the other parties’ interests must be subject to agreement by all the coastal states.64

Azerbaijan, the clear target of Russia’s ire, had already begun trying to appease its powerful northern neighbor, while also stressing its right to develop its Caspian resources. Although the initial round of Azerbaijani negotiations with the consortium had not included Russia,65 it was brought in early in 1994. In March of that year, Lukoil was given a 10 percent share in the consortium.66 In addition, Azerbaijan awarded Lukoil multi-billion-dollar contracts in 1995 and 1996.67

Russia therefore found itself in an ironic position by early 1994: while its Foreign Ministry was calling Azerbaijani oil operations in the Caspian illegal and threatening to disrupt them forcibly, its Ministry of Fuel and Power – allied with Lukoil and other powerful oil companies – was preparing to assist Azerbaijan in the same projects.68 The oil lobby scored a major victory in November 1994, when Prime Minister Chernomyrdin, the former head of Gazprom, met President Aliyev in Moscow and reaffirmed his acceptance of the consortium deal.69

Two years later, in November 1996, the Russian Foreign Ministry softened its stance by proposing a hybrid plan that combined Azerbaijan’s position, calling for national sectors in the Caspian, with Iran’s and Russia’s positions in support of shared use and ownership.70 The compromise, to which all the coastal states except Azerbaijan subscribed, provided for national sovereignty over the mineral resources within forty-five miles of each state’s coast, with the middle area to be left for joint development.71 The Foreign Ministry, however, once again had to witness the undermining of its position from within the government when, in August 1997, Russia’s Ministry of Natural Resources awarded a tender to Lukoil to develop a field in the northern Caspian.72 The field stretched so far beyond the forty-five-mile zone that Kazakhstan lodged a protest with Moscow, claiming it encroached on Kazakh territory.73

Finally, in February 1998, Russia reversed its long-held position on the Caspian regime and, in what may be considered the final victory of the oil interests within the government, declared that it now supported the sectoral division of the entire Caspian seabed.74 On July 6, 1998, Russia and Kazakhstan divided the northern portion of the seabed between themselves according to an equidistant line.75 The agreement concerned only the seabed, however, since Russia insisted that the Caspian waters should be common property.76


Kazakhstan and Turkmenistan

Kazakhstan has argued that the legal regime of the Caspian must be determined by the United Nations Convention on the Law of the Sea.77 Accordingly, Kazakhstan supports the establishment there of internal and territorial waters and an exclusive economic zone.78 In October 1993, Turkmenistan became the first Caspian coastal state to pass a law declaring its jurisdiction over a 12- mile territorial sea and a “maritime economic zone.”79 Turkmenistan has also reached a basic understanding with Azerbaijan and a purported agreement with Kazakhstan on sectoral division of the sea.80 Although Kazakhstan, Turkmenistan, and Azerbaijan now agree on the principle of equidistantline division of the Caspian, they differ among themselves as to how the line should be drawn. As of December 31,1999, no definite agreement on this point had been reached.81



The dispute over whether the Caspian should be divided or shared has been largely settled between the littoral states through multiple bilateral agreements.82 The chances that a court would ever rule on the legal status of the Caspian seabed are therefore slim. However, one may arrive at a suggestion of what such an opinion might be by critically examining the concept of condominium championed by Iran and Russia until recently.

First, there are few examples of shared ownership of seabed resources in international case law and state practice. As Professor Oxman points out: “The reality is that most lakes and semi-enclosed seas bordered by more than one state have been partitioned. . . . Those arguing for condominium bear a substantial burden. . . . With respect to hydrocarbon and mineral deposits, partition. . . . is supported by overwhelming state practice.”83 Similarly, J. H. W. Verzijl has noted that examples of common ownership of lakes and inland seas “do not to my knowledge actually exist.”84

The only case in which a court has held in favor of the principle of condominium concerns the Gulf of Fonseca. Situated in the Pacific Ocean, the gulf is surrounded by El Salvador, Honduras, and Nicaragua. Prior to 1821, all three countries were part of the Spanish Empire. Similarly to the dispute over the Caspian, the Gulf of Fonseca case involved state succession and rival claims to a body of water that arose only after the breakup of an empire.85 A chamber of the International Court of Justice found that the three riparian states were each entitled to a three-mile strip off their coast, but that beyond this limit the waters of the gulf appertained to them all.86

Important factors, however, distinguish the question of the Gulf of Fonseca from that of the Caspian. For one thing, unlike the Caspian, the gulf belonged to a single state before its dissolution. In addition, the successor states in the Gulf of Fonseca case, unlike those in the case of the Caspian, had treated the body of water as common property for an extended period of time. Finally, as Brice Clagett points out, the ICJ, which was mainly concerned with the issue of navigation, realized that division of the Gulf of Fonseca would have created insurmountable difficulties by leaving at least one of the states with no deepwater outlet to the sea. No such difficulty, insofar as division of the seabed is concerned, characterizes the Caspian case.87 In fact, one may argue that division of the seabed may be the best way to avoid the complications that usually arise in shared-use/ownership arrangements.

The history of the littoral states’ practice in the Caspian further weakens the argument that it is the common property of those states. As mentioned above, beginning in 1949 the Soviet Union engaged in intensive oil operations in the Caspian without acquiring the consent of its southern neighbor. Fear of the political complications of raising objections to these operations did not prevent Iran from publicly and privately airing its concerns about the oil pollution in the Caspian caused by Soviet offshore drilling.88 An argument may therefore be made that Iran’s forty-year-long silence regarding Soviet oil operations now prevents it from raising objections to similar operations by the successor states.



The contest over mining rights in the Caspian is largely over. All the littoral states now favor sectoral division of the seabed. The dispute has therefore shifted from whether the seabed should be divided to how that division might be accomplished.89 As this discussion has illustrated, Iran and Russia, which supported the shared-use/ownership principle in the early 1990s, have now accepted the principle of sectoral division of the seabed not because their opponents’ legal arguments proved to be compelling but, rather, because forces of domestic and international politics left them with no other viable options. That is, supporters of condominium lost the battle not in the courtroom but in the boardroom of domestic and international politics.

If the past of the Caspian is any guide to its future, one may predict that the emerging issues of the technicalities of seabed division and the fate of the waters will be determined not so much by legal arguments as by the political and geostrategic concerns of the littoral states. These concerns range in general from the future shape of regional and international alliances to the location and direction of underwater (and overland) oil and gas pipelines. Given the importance of the Caspian energy reserves to the world’s economy, a replay of the nineteenth-century “great game”90 – with different players and some new rules – is not a surprising spectacle at the dawn of the third millennium.



1 Proven reserves in the Caspian Basin are 15.31 billion barrels of oil, or 2.7% of world reserves. It is also estimated to contain some 230-360 trillion cubic feet of gas, or 7% of world reserves. Estimates of possible petroleum reserves vary from as few as 20 billion to as many as 200 billion barrels of oil. See The changing face of energy geopolitics, OECD OBSERVER, June 22, 1999, at 48, available in LEXIS, News Library, Curnws File.

2 The Caspian Sea is approximately 1,204 kilometers long and has a surface area of 436,000 square kilometers. By comparison, the combined area of the five Great Lakes in North America is approximately 244,000 square kilometers. See INTERNATIONAL ENERGY AGENCY, CASPIAN OIL AND GAS 147 (1998) [hereinafter CASPIAN OIL & GAS].

3 See Robert B. O ‘ Connor, Jr., et al., Future Oil and Gas Potential in Southern Caspian Basin, OIL & GAS J., May 3, 1993, at 117, 117.

4 See Brice M. Clagett, Ownership of Seabed and Subsoil Resources in the Caspian Sea under the Rules of International Law, CASPIAN CROSSROADS MAG., Summer/Fall 1995, at 3, 10.

5 See THE NEW YORK TIMES ATLAS OF THE WORLD, plate 44 (9th rev. ed. 1994) (giving figure of 28 meters below sea level).

6 See 2 THE NEW ENCYCLOPEDIA BRITANNICA 924 (15th ed. 1998).

7 See William E. Butler, The Soviet Union and the Continental Shelf, 63 AJIL 103, 106 (1969).

8 Some authoritative nonlegal sources have used more than one of the above labels to refer to the Caspian Sea. The Encyclopedia Britannica, for example, uses both “inland sea” and “lake” to refer to the Caspian. 2 THE NEW ENCYCLOPEDIA BRITANNICA, supra note 6, at 923-24 (referring to the Caspian as the “world’s largest inland sea”); 7 id. at 107 (referring to the “Caspian Sea” as a lake in Asia).

9 Professor Oxman has argued that, although the classification is significant, it must not dictate which of the different legal regimes that should apply to Caspian water, subsoil resources, fishing rights, shipping rights, and so forth. See Bernard Oxman, Caspian Sea or Lake: What Difference Does It Make? CASPIAN CROSSROADS MAG., Winter 1996, at 1.

10 Treaty of Peace and Perpetual Friendship, Oct. 12, 1813, Persia-Russ., 62 Consol. TS 435 (in French) [hereinafter Golestan Treaty]; Treaty of Peace and Friendship, Feb. 10 (22), 1828, Persia-Russ., 78 Consol. TS 105 (in French) [hereinafter Turkmenchai Treaty]. For the Persian texts, see MINISTRY OF FOREIGN AFFAIRS, MAJMUEH MOAHEDAT-E DO JANEBEH-E IRAN BA SAYER-E KESHVARHA [A Compilation of Bilateral Treaties between Iran and Foreign Countries] (1971), cited in Mohamad Reza Dabiri, Rezhim-e hogugy-e darya-e khzar be onvan mabnaii baray-e solh va tose-eh [The Legal Regime of the Caspian Sea: A Basis for Peace and Development], MAJALLEH-E MOTALEAT-E ASYAY-E MARKAZIVA GAVGAZ [Journal of Central Asian and Caucasian Studies] [hereinafter MAJALLEH], Summer 1994, at 1, 3 (published by the Iranian Ministry of Foreign Affairs).

11 Golestan Treaty, supra note 10, Art. 5, quoted in Dabiri, supra note 10, at 3.

12 Turkmenchai Treaty, supra note 10, Art. 8, quoted in Dabiri, supra note 10, at 4.

13 Treaty of Friendship, Feb. 26, 1921, Persia-Russ. SFSR, 9 LNTS 383. Article 11 stated: As Article 1 of the present treaty abrogates the treaty signed by the high contracting parties in February 1828, including Article 8 of that treaty, which deprived Iran of maintaining a naval force in the Caspian Sea, the high contracting parties hereby declare that henceforth both parties will have equal rights to free shipping under their own flags in the Caspian Sea. Quoted in Dabiri, supra note 10, at 5 (trans. from Persian by author).

14 Treaty of Establishment, Commerce and Navigation, with Final Protocols and Annex, Aug. 25, 1935, Iran-USSR, Art. 15, 176 LNTS 301, 317. Article 14 stated: The Contracting Parties agree that, in conformity with the principles set forth in the Treaty of February 26th, 1921, between the Russian Socialist Federal Soviet Republic and Persia, there shall, throughout the area of the Caspian Sea, be only vessels belonging to the Union of Soviet Socialist Republics or to Iran and to nationals or commercial and transport organisations of one of the two Contracting Parties, flying the flag of the Union of Soviet Socialist Republics or that of Iran, respectively.

15 Treaty of Commerce and Navigation, Mar. 25, 1940, Iran-USSR, 144 BRIT. & FOREIGN ST. PAPERS 419 (1940-42); see WILLIAM E. BUTLER, THE SOVIET UNION AND THE LAW OF THE SEA 102 (1971).

16 See BUTLER, supra note 15, at 102.

17 See Jamshid Momtaz, Vaziyyat-e hoghugi-e daryay-e Khazar [The Legal Situation of the Caspian Sea], MAJALLEH, Summer 1995, at 123, 127.

18 See Dabiri, supra note 10, at 7. The reference to the Caspian Sea as a “Soviet-Iranian Sea” was also used in the notes attached to the 1935 Treaty, supra note 14, 176 LNTS at 329.

19 Agreement concerning the Settlement of Frontier and Financial Questions, Dec. 2, 1954, Iran-USSR, 451 UNTS 250.

20 See BUTLER, supra note 15, at 125.

21 See id. at 116-33.

22 See id. at 125. For a discussion of the closed-sea doctrine as applied to the Black Sea, see Joseph J. Darby, The Soviet Doctrine of the Closed Sea, 23 SAN DIEGO L. REV. 685 (1986). Since the Caspian, unlike the Black Sea and the Baltic Sea, is not directly connected to the ocean, the Soviet classification of the Caspian as a “closed sea” did not give rise to opposition by outside powers.

23 At the 1958 United Nations Conference on the Law of the Sea, Romania and the Ukrainian Soviet Socialist Republic proposed an addition to Article 1 of the Convention on the High Seas providing that “for certain seas a special regime of navigation may be established for historical reasons or by virtue of international agreements.” The United States, the United Kingdom, and others argued against the proposal on the grounds that it was an opening wedge for “closed seas.” See GARY KNIGHT & HUNGDAH CHIU, THE INTERNATIONAL LAW OF THE SEA: CASES, DOCUMENTS, AND READINGS 325-26 (1991).


25 Loi relative à l’explorarion et à l’exploitation du “Falat Gharreh” (Plateau continental de l’Iran), June 19, 1955, Art. 2 note, LAWS AND REGULATIONS ON THE REGIME OF THE TERRITORIAL SEA 24, UN Doc. ST/LEG/SER.B/6, UN Sales No. 1957.V.2 (1957). The official French text of the law, provided by the Iranian Mission to the United Nations, translates “closed seas” as les mers fermées. The original Persian reads daryay-e basteh, literally “closed sea.” See Mohamad Reza Dabiri, Rezhime-e hoghugi-e daryay-e khazar: ameli baray-e tavazon manafeh va tavazon amniyat [The Caspian’s Legal Regime: Balancing National Interests and National Security], MAJALLEH, Summer 1995, at 141, 144. The only published English text of the law, however, renders the relevant phrase as “inland sea,” without specifying the source of the translation. See 1 NEW DIRECTIONS IN THE LAW OF THE SEA (S. Houston Lay et al. eds., 1973).

26 The Iranian lawmakers were probably referring to the doctrine of mare clausum. That doctrine, however, has never found international acceptance, and during the 19th and 20th centuries it received only passing notice from Western jurists. See BUTLER, supra note 15, at 116. According to the then deputy director of the Iranian Foreign Ministry’s Institute of Political and International Studies, the legislative intent was to distinguish the Caspian legal regime from those of other bodies of water. Dabiri, supra note 10, at 7.

27 See Momtaz, supra note 17, at 129. Commercial oil production in Azerbaijan goes back to the 19th century. Russian annual crude oil production from Azerbaijani fields rose from 600,000 barrels in 1874 to 10.8 million in 1884. See DANIEL YERGIN, THE PRIZE: THE EPIC QUEST FOR OIL, MONEY AND POWER 57 (1991).

28 See Michael P. Croissant & Cynthia M. Croissant, The Caspian Sea Status Dispute: Azerbaijani Perspectives, CAUCASIAN REGIONAL STUD., No. 1 1998 < crs/eng/0301-01.htm> (visited Mar. 7, 1999).

29 See Momtaz, supra note 17, at 129.

30 See id.

31 See Dabiri, supra note 25, at 142.

32 See Statement of the Foreign Ministry of the Islamic Republic of Iran on the results of the Kazakhstan-Russian consultations reflected in the statement dated 13 February 1998 of the Kazakhstan Foreign Ministry, UN Doc. A/52/913, annex (1998).

33 See M.S. Nourian, Negareshhay-e motafavet dar barey-e rezhim-e hogugy-e daryay-e khazar [Alternative Viewpoints on the Caspian’s Legal Regime], MAJALLEH, Summer 1996, at 105, 111 (the author was then the director of the Iranian Foreign Ministry’s Department of Boundaries).

34 See id. at 112.

35 In its early position on this issue set out in 1993 in a draft treaty, Iran proposed that the Caspian Sea be jointly used and managed by the littoral states, and that participation by third states require the prior consent of all the littoral states. The legal status of the sea was left to be determined later. See Sergei Vinogradov & Patricia Wouters, The Caspian Sea: Quest for a New Legal Regime, 9 LEIDEN J. INT’L L. 87, 94 (1996).

36 See Nourian, supra note 33, at 106.

37 See id.

38 The first Iranian official to apply the concept of condominium to the Caspian was Mohamad Reza Dabiri. See Dabiri, supra note 10, at 17 (using the Persian term Hakemiiat Mosha, which he translates in a footnote as “Condominium or Res Communis”).

39 This point is readily acknowledged by Iranian officials. See Nourian, supra note 33, at 115.

40 The U.S. Iran-Libya Sanctions Act, Pub. L. No. 104-172, 110 Stat. 1541 (1996), threatens reprisals against foreign firms that invest more than $20 million a year in the country’s energy sector. The legislation will expire in 2001.

41 In the northern third, the average depth of the Caspian is 6.2 meters; in the center, 176 meters; and in the south, 325 meters. See CASPIAN OIL & GAS, supra note 2, at 147. For both political and economic reasons, Iran has tried to secure a share in Azerbaijan’s oil projects. On Azerbaijan’s consortium deal, see note 54 infra.

42 See supra note 35.

43 See the discussion below on the Russian and Azerbaijani positions.

44 See Iran: Rowhani Calls for Unanimous Legal Regime for Caspian, Foreign Broadcast Information Service [hereinafter FBIS], Doc. FBIS-NES-98-270 (Sept. 27, 1998) (statement of Hassan Rowhani, secretary of the Supreme National Security Council, to Russian Ambassador Konstantin Shuvalev). For the Iranian insistence on a single division scheme, see Iran: Maleki on policy toward US, Caspian Issues, Doc. FBIS-EAS-1999-0214 (Feb. 14, 1999) (interview with Iranian Deputy Foreign Minister Abbas Maleki) [hereinafter the date in the parenthetical to FBIS documents will omit the year, which is reflected in the document number, and subsequent cites to previously referenced FBIS documents will be by document number].

45 See Hossein K. Ardabili, Rezhim-e hogugy-e khazar, toseye-e manabeh va khotut-e enerzhi [The Caspian’s Legal Regime: The Development of Energy Resources and Pipelines], MAJALLEH, Spring 1998, at 45, 48 (the author is an adviser to the Iranian Foreign Affairs and Oil Ministries). Iran’s new position regarding equal division of the Caspian may, in turn, be changing. In August 1998, Boris Pastukhov, the then deputy foreign minister of the Russian Federation, reported that Iranian negotiators were insisting on Iran’s 20% share. See Azerbaijan: Recent Movement in Caspian Talks Assessed, Doc. FBIS-SOV-98-231 (Aug. 19). The latest pronouncements of Iranian officials call only for an “equitable” and “fair” division. Doc. FBIS-EAS-1999-0214, supra note 44 (statement of Iranian deputy foreign minister).

46 See Joint statement on Caspian Sea questions adopted by Presidents of Azerbaijan and Kazakhstan in Baku on 16 September 1996, Art. 4, UN Doc. A/51/529, annex (1996).

47 See Doc. FBIS-SOV-98-231, supra note 45 (statement by Azerbaijani foreign minister).

48 See Russia: Joint Azeri-Russian Statement Outlines Talks on Caspian Sea, Doc. FBIS-SOV-98-217 (Aug. 5).

49 Both Azerbaijan and Kazakhstan have produced maps and documents showing that such a division, in fact, took place. Among these is an internal document of the USSR Ministry of Oil Industry, dated 1970, that divided the Soviet part of the Caspian among Azerbaijan, Kazakhstan, Russia, and Turkmenistan “on the center line basis accepted in international practice.” See Mikhail Alexandrov, Russian-Kazakh Contradictions on the Caspian Sea Legal Status, RUSS & EURASIAN BULL., Feb. 1998 (Contemporary Europe Research Center, University of Melbourne) <> (visited Feb. 19, 1999). These documents are at present the basis of negotiations between Azerbaijan and Turkmenistan on how to divide their portion of the sea. Azerbaijan claims that this division must follow Soviet practice, while the Turkmens contend that the Soviet internal documents were only administrative decisions and did not have the force of international boundary treaties. See Azerbaijan: Azeri, Turkmen Teams Agree “Basic Points” on Caspian Sea, Doc. FBIS-SOV-98-040 (Feb. 9). (Turkmenistan’s reported position, however, appears to be at variance with its earlier position calling for observance of Soviet-era divisions until the status of the sea is finally settled. See Turkmenistan-Background of Caspian Disputes, APS REV. OIL MARKET TRENDS, Sept. 7, 1998, available in LEXIS, News Library, Curnws File.) Khushbakht Yusefzadeh, an adviser to Azerbaijan’s vice president, has relied on the same documents to claim that Azerbaijan’s share of the Caspian was 80,000 square kilometers. The shares of the other republics were reportedly as follows: Russia, 64,000 square kilometers; Turkmenia, 80,000 square kilometers; and Kazakhstan, 113,000 square kilometers. See Nourian, supra note 33, at 122. Vinogradov and Wouters point out that the Soviet Ministry of Internal Affairs unilaterally established a delimitation line that continued the land border between Astara and Husseingholi in 1935, but that it “has never been recognized by Iran as the Soviet-Iranian border.” Sergei Vinogradov & Patricia Wouters, The Caspian Sea: Current Legal Problems, 55 ZEITSCHRIFT FÜR AUSLÄNDISCHES ÖFFENTLICHES RECHT UND VÖLKERRECHT 604, 609 (1995).

50 See Nourian, supra note 33, at 23.

51 Article 11 of the Azerbaijan Constitution reads in relevant part: “The territory of the Azerbaijan Republic shall be united, inviolable and indivisible. The Azerbaijan Republic territory shall include the Azerbaijan Republic inner waters, the Caspian Sea (Lake) sector relating to the Azerbaijan Republic, and space over the Azerbaijan Republic.” <> (visited Mar. 7, 1999). It is not clear whether Azerbaijanis insist on total sovereignty over their portion of the Caspian. Such a position, of course, would conflict with the law of the sea, which precludes full sovereignty beyond a 12-mile territorial sea but would allow sovereign mining rights within the exclusive economic zone.

52 “Azerbaijan’s sector of the Caspian is estimated to contain 25 of the 32 known oil and gas fields of the Sea as well as 145 of the 386 prospective structures.” Croissant & Croissant, supra note 28.

53 Id.

54 In 1994, during negotiations for an $8 billion deal with mainly Western oil companies, Azerbaijan offered Iran a 5% share in the consortium. The United States strongly objected to Iranian participation and threatened to persuade the Western oil companies to abandon the project. Azerbaijan eventually relented and substituted Turkey for Iran. The move predictably provoked strong Iranian opposition to the deal. See Vinogradov &Wouters, supra note 35, at 88.

55 Glen Rase, the State Department’s director of international energy policy, stated that, [t]o my knowledge, no body of water like the Caspian is treated as condominium as the Russians prefer…. The more normal course with bodies of water that fall on international boundaries…would be to have lines of divisions for economic purposes on the sea bed to create exclusive economic zones. That strikes us as a perfectly reasonable way to go forward and that certainly seems to be what the Kazakhs, Azeris and Turkmens desire. Terry Manzi, Interview with Glen Rase, CASPIAN CROSSROADS MAG., Winter 1995 <> (visited Sept. 18, 1999). Azerbaijani officials have repeatedly stated that the United States supports their position. See Doc. FBIS-SOV-98-231, supra note 45 (statement of State Counselor for Foreign Policy Vafa Guluzade).

56 Azerbaijan: Azerbaijans Aliyev on Disagreement with Russia on Caspian, Doc. FBIS-SOV-98-217 (Aug. 5) (statement of HeydarAliyev, president of Azerbaijan, to Interfax news agency). This understanding was confirmed in a Russian-Azerbaijani joint statement later that month. See Doc. FBIS-SOV-98-231, supra note 45.

57 See Doc. FBIS-SOV-98-040, supra note 49 (statement of Elbars Kepbanov, deputy foreign minister of Turkmenistan, to Azerbaijan’s Turan news agency).

58 Some reports have indicated that Turkmenistan favors an equidistant line delineated without taking inlets or islands into consideration, while Azerbaijan would include them in its calculations. See Azerbaijan-Turkmenistan, PLATT’S OILGRAM NEWS, Apr. 1, 1998, available in LEXIS, News Library, Curnws File.

59 One of the fields, called Serdar by the Turkmens and Kyapaz by the Azerbaijanis, seems to lie, at least partially, in the Turkmen sector. In August 1997, following strong protests by Turkmenistan and apparently in recognition of the validity of the Turkmen claims, Russian President Boris Yeltsin canceled an agreement between Rosneft and Lukoil to develop the field with Azerbaijan. The deal was reportedly worth $1 billion. See Azerbaijan wants clarification on Caspian, J. COM., Aug. 28, 1997, at 12A. Later that year, Turkmenistan appealed to the United Nations for assistance in settling the dispute. See Alexandrov, supra note 49.

60 Yuri Fedorov, Russia’s Policies toward Caspian Region Oil: Neo-Imperial or Pragmatic? in PERSPECTIVES ON CENTRAL ASIA, Oct. 1996 (Center for Post-Soviet Studies, Carnegie Corp. of NY) (quoting Yakov Pappe) <http://> (visited Dec. 28, 1999).

61 Andrew Seek et al., Azerbaijan: Rediscovering Its Oil Potential? A Legal Perspective, 13 J. ENERGY & NAT. RESOURCES L. 147, 157 (1995) (quoting FIN. TIMES (London), May 31, 1994, at 2).

62 Letter dated 5 October 1994 from the Permanent Representative of the Russian Federation to the United Nations Addressed to the Secretary-General (Position of Russian Federation regarding the legal regime of the Caspian Sea), UN Doc.A/49/475 (1994), reprinted in 10 INTERNATIONAL ORGANIZATIONS AND THE LAW OF THE SEA: DOCUMENTARY YEARBOOK 1994, at 195, 196 [hereinafter Russian 1994 Letter].

63 Alma Ata Declaration, Dec. 21, 1991, 31 ILM 148 (1992).

64 See Russian 1994 Letter, supra note 62, at 195-96; and Alexandrov, supra note 49.

65 These talks were conducted in 1993 in London. See Fedorov, supra note 60.

66 Lukoil’s share came out of that of the Azerbaijani national oil company and did not reduce the Western consortium’s interest. See Seek et al., supra note 61, at 157.

67 For details, see Fedorov, supra note 60.

68 The tension between the Foreign and Fuel and Power Ministries surfaced in a conference on the legal status of the Caspian that took place in Moscow in October 1995. The director of the Legal Department of the Russian Foreign Ministry stated the standard position of his ministry, adding veiled criticism of Azerbaijan’s unilateral actions in the Caspian. The vice president of Lukoil responded by emphasizing the economic and political benefits of cooperation between Russian and Azerbaijani oilmen, and went on to say: “[Lukoil] knows how to extract oil and how to do it in the best possible way, while the Foreign Ministry’s employees know how to deal with political problems. Therefore, everyone is concerned with his own business.” Thus, the claim of Russia’s deputy minister of foreign affairs, who stated in the same conference that there were “no differences of principle in the approach to the Caspian problem” between the two ministries, does not seem very credible. For a report on the conference, see Lev Klepatsky & Valery Pospelov, Manoeuvring Round the Caspian Sea, 10 INT’L AFF. 59 (Moscow 1995).

69 See Robert V. Barylski, Russia, the West, and the Caspian Energy Hub, 49 MIDDLE E.J. 217, 224 (1995). Barylski describes the behind-the-scenes struggle between the Foreign Ministry and the representatives of the oil interests in the Russian government, noting Chernomyrdin’s refusal to adopt a hard-line policy. Id. at 223.

70 See Azerbaijan: Caspian Sea Status to Be Discussed in Russian-Azeri Talks, Doc. FBIS-SOV-98-209 (July 28).

71 Id. Russia also signaled its willingness to accept other coastal states ‘ “spot jurisdiction” over oil sites outside the 45-mile zone if certain criteria were met, and if the sites were already being, or were about to be, developed. This stipulation seemed to recognize the interests of Lukoil and other Russian oil companies that were partners in these projects. See Alexandrov, supra note 49.

72 See Alexandrov, supra note 49.

73 See Syed Rashid Ali, Russia/Kazakhstan Caspian Agreement, PETROLEUM TIMES ENERGY REP., Feb. 1998, at 6, available in LEXIS, News Library, Curnws File.

74 See Azerbaijan: Baku Encouraged by New Russian Proposals on Caspian, Doc. FBIS-SOV-98-041 (Feb. 10).

75 See Russia and Kazakhistan share Caspian spoils, BBC Online Network, July 7, 1998 <> (visited Feb. 29, 1999).

76 See id. In a joint statement signed by Azerbaijan and Russia in August 1998, the two sides agreed that the seabed should be divided into sector-zones along an equidistant line modified on “the basis of the principles of fairness and the agreement of the parties.” Doc. FBIS-SOV-98-231, supra note 45. Russia justifies its opposition to division of waters of the Caspian by arguing that it would violate the ecological integrity of the sea, but Russia’s underlying concern is obviously that such a division would deprive it of a veto over the direction of proposed underwater pipelines. Russia claims that the best pipeline route is overland through its territory since underwater pipelines are ecologically unsafe. Interestingly, its opposition to underwater pipelines does not extend to those under the Black Sea, where Russia supports building a gas pipeline from its territory to Turkey. The deputy foreign minister has explained this discrepancy by noting that, while the Caspian is earthquake prone, the Black Sea is not. See Russia warns of “banditry” if Caspian status is unresolved, BBC Online Network, Mar. 27, 1998 <http://> (visited Feb. 19, 1999). In response to Iran’s objections, Russia has stated that the Russian-Kazakh agreement “does not create a special status for the northern part of the Caspian Sea, neither does it contradict the Soviet-Iranian treaties of 1921 and 1940.” See Russia: Spokesman on Russia, Iran Dividing Bed of Caspian Sea, Doc. FBIS-SOV-98-202 (July 21) (statement of Vladimir Rakhmanin, Russian Foreign Ministry spokesman, to ITARTASS). The fate of the Russian-Kazakh agreement is still unclear since the Duma has not ratified it. Andranik Migranyan, a member of the Russian Federation’s Presidential Council, said in November 1998 that the Duma would probably reject the agreement. Georgii Tikhonov, the chairman of the Duma’s Energy Committee, has also said that the Duma would consult all the littoral states, especially Iran, before debating on the deal. See Iran: Doubts over Russian Duma Approval of Caspian Agreement, Doc. FBIS-NES-98-311 (Nov. 7).

77 See Alexandrov, supra note 49.

78 See Vinogradov & Wouters, supra note 35, at 95.

79 Law on the State Border, Oct. 1, 1993, Art. 6, cited in id. at 92-93.

80 On the Azerbaijani-Turkmen understanding on “basic points” on the Caspian, see Doc. FBIS-SOV-98-040, supra note 49. The Kazakh-Turkmen agreement of March 1997 stated that “all countries bordering the Caspian Sea must stand by the principle of dividing the water area out to a middle line until the Caspian Sea’s legal status is determined.” See Croissant & Croissant, supra note 28, at 10 (quoting agreement signed by the presidents of the two states).

81 The United States has attempted to expedite these negotiations by submitting proposals to both sides on how to draw a median line. Richard Morningstar, before leaving his post as special adviser to the president and secretary of state for Caspian Basin energy, reported that the U.S. experts had “submitted a scientific method to the Azerbaijani and Turkmen parties that will allow both parties to reach a mutually acceptable agreement.” He expressed the hope that the parties would be able to reach an agreement “within a few months.” US Envoy’s Comments on Azeri-Turkmen Dispute Reported, Doc. FBIS-SOV-1999-0624 (June 24).

82 These agreements include the one signed by Russia and Kazakhstan in July 1998, supra note 75, and the Turkmenistan-Kazakh agreement of March 1997, supra note 80. See also supra note 57 for the basic Azerbaijani-Turkmen understanding on division of the seabed.

83 Oxman, supra note 9, at 6, 12.

84 3 J. H. W. VERZIJL, INTERNATIONAL LAW IN HISTORICAL PERSPECTIVE 19 (1970), quoted in Clagett, supra note 4, at 6.

85 See Rodman R. Bundy, Janbehaye Hogugy-e hefazat az mohit-e zist-e daryay-e khazar, MAJALLEH, Summer 1996, at 138, translated from Legal Aspects of Protecting the Environment of the Caspian Sea, 5 REV. EUR. COMMUNITY & INT’L ENVTL. L. 122 (1996).

86 Land, Island and Maritime Frontier Dispute (El Sal./Hond.: Nicar. intervening), 1992 ICJ REP. 351 (Sept. 11), cited in Oxman, supra note 9, at 6.

87 Clagett, supra note 4, at 7.

88 It is estimated that up to 10% of Soviet offshore drilling production in the Caspian (approximately 300,000-400,000 tons of oil) escaped into the sea each year. In 1968 the USSR Council of Ministers adopted a decree that, inter alia, prohibited the operation of new wells in the Caspian unless effective measures were taken to prevent pollution. See BUTLER, supra note 15, at 137-38. The oil pollution not only endangered rare marine life, but also was carried to the south and southwestern shores of the Caspian, where it washed up on beaches that were among the favorite holiday resorts of Iranians. Iranian concern was mainly responsible for a Soviet-Iranian agreement on pollution control in the Caspian signed in 1971. See David Housego, Iran-Russia action for cleaner Caspian, TIMES (London), Apr. 29, 1971, at 9.

89 The other contentious issue is the legal regime of the Caspian waters. Iran is the only coastal state that has linked its agreement on the status of the seabed to that of the waters. See supra text at note 44.


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