The Canadian government claims that some of the waters of the Northwest Passage, particularly those in the Canadian Arctic Archipelago, are internal to Canada, giving Canada the right to bar transit through these waters.[6] Most maritime nations,[24] including the United States and the nations of the European Union,[25] consider them to be an international strait, where foreign vessels have the right of "transit passage".[26] In such a régime, Canada would have the right to enact fishing and environmental regulation, and fiscal and smuggling laws, as well as laws intended for the safety of shipping, but not the right to close the passage.[27][28] In 1985, the U.S. icebreaker Polar Sea passed through, and the U.S. government made a point of not asking permission from Canada. They claimed that this was simply a cost-effective way to get the ship from Greenland to Alaska and that there was no need to ask permission to travel through an international strait. The Canadian government issued a declaration in 1986 reaffirming Canadian rights to the waters. However, the United States refused to recognize the Canadian claim. In 1988 the governments of Canada and the U.S. signed an agreement, "Arctic Cooperation", that did not solve the sovereignty issues but stated that U.S. icebreakers would require permission from the Government of Canada to pass through.[29]

In late 2005, it was alleged that U.S. nuclear submarines had travelled unannounced through Canadian Arctic waters, sparking outrage in Canada. In his first news conference after the federal election, Prime Minister-designate Stephen Harper contested an earlier statement made by the U.S. ambassador that Arctic waters were international, stating the Canadian government's intention to enforce its sovereignty there. The allegations arose after the U.S. Navy released photographs of the USS Charlotte surfaced at the North Pole.[30][31]

On April 9, 2006, Canada's Joint Task Force North declared that the Canadian military will no longer refer to the region as the Northwest Passage, but as the Canadian Internal Waters.[32] The declaration came after the successful completion of Operation Nunalivut (Inuktitut for "the land is ours"), which was an expedition into the region by five military patrols. [33]

In 2006 a report prepared by the staff of the Parliamentary Information and Research Service of Canada suggested that because of the September 11, 2001 attacks the United States might be less interested in pursuing the international waterways claim in the interests of having a more secure North American perimeter.[29] This report was based on an earlier paper, The Northwest Passage Shipping Channel: Is Canada’s Sovereignty Really Floating Away? by Andrea Charron, given to the 2004 Canadian Defence and Foreign Affairs Institute Symposium.[9] Later in 2006 former United States Ambassador to Canada, Paul Cellucci agreed with this position; however, the current ambassador, David Wilkins, states that the Northwest Passage is in international waters.[34]

On July 9, 2007 Prime Minister Harper announced the establishment of a deep-water port in the far North. In the government press release the Prime Minister is quoted as saying, “Canada has a choice when it comes to defending our sovereignty over the Arctic. We either use it or lose it. And make no mistake, this Government intends to use it. Because Canada’s Arctic is central to our national identity as a northern nation. It is part of our history. And it represents the tremendous potential of our future."[35]

On July 10, 2007, Rear Admiral Timothy McGee of the United States Navy, and Rear Admiral Brian Salerno of the United States Coast Guard announced that the United States would also be increasing its ability to patrol the Arctic

Canadian Navy: Operation Ocean Vigilance
When: 1995-1997 - Turbot fisheries dispute with Spain
Where in the World: Off the Grand Banks of Newfoundland
Who: Maritime Forces Atlantic vessels
What: Also known as the turbot dispute, this operation responded to the over fishing of Grand Banks waters. Navy vessels were sent to observe Spanish fishing activity suspected of contravening fishing regulations. As a result, the Navy retrieved an illegal fishing net from seabed for the Department of Fisheries and Oceans, in a continued effort to protect Canada’s shorelines.