The long-simmering hostility between Ottawa and Tehran has boiled over into a full-blown diplomatic crisis. On December 30, 2025, the Iranian Ministry of Foreign Affairs officially designated the Royal Canadian Navy (RCN) as a terrorist organization. This unprecedented move is a direct retaliatory strike against Canada’s June 2024 decision to list the Islamic Revolutionary Guard Corps (IRGC)—the ideological wing of Iran’s military—as a terrorist entity under the Criminal Code.
Tehran’s justification rests on a 2019 domestic law that mandates reciprocal action against any nation following the United States’ lead in labeling the IRGC as terrorists. While Canada has rejected the designation as “baseless and politically motivated,” the legal reality for Canadian sailors has shifted. The listing theoretically allows Iran to treat Canadian naval vessels as “terrorist assets” in international waters, particularly near the strategic Strait of Hormuz. With diplomatic ties already severed since 2012, this new escalation effectively kills any hope for “controlled engagement” in the new year.
