A nation's internal waters covers all water and waterways on the landward side of the baseline from which a nation's territorial waters is defined. It includes waterways such as rivers and canals, and sometimes the water within small bays. According to the United Nations Convention on the Law of the Sea, the coastal nation is free to set laws, regulate any use, and use any resource. Foreign vessels have no right of passage within internal waters, and this lack of right to innocent passage is the key difference between internal waters and territorial waters.
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