It's not easy to define innocent passage in the territorial sea. The US Department of Defense gave it a try. I would like to pay attention to the definition McLaughlin gives in his shortly published book United Nations Naval Peace Operations in the Territorial Sea: "Although innocent passage is a single unitary concept, at first glance it appears to comprise two separable elements"(page 103).
The concept of passage is defined in article 18 United Nations Convention on the Law of the Sea (Montego Bay, 1982) as 'continious and expeditious' navigation through the territorial sea from and to any other sea zone. The passage, to be characterised as innocent, must not be prejudicial to the peace, good order and security of the coastal state (article 19 UNCLOS III).
Article 30 UNCLOS III states that 'If any warship does not comply with the laws and regulations of the coastal State concerning passage through the territorial sea and disregards any request for compliance therewith which is made to it, the coastal State may require it to leave the territorial sea immediately.'
Is the coastal state allowed to use force, and if so to what extent? What if the warship is acting in its ‘normal mode’ of operation?
In the Corfu Channel incident British warships passing the Corfu Channel were fired upon by Albanian guns. The warships were in innocent passage but their minesweeping operation afterwards was not innocent and constituted a breach of the territorial sovereignty of Albania.
The International Court of Justice in its judgment Corfu Channel (9 April 1949) ruled that
"It is, in the opinion of the Court, generally recognized and in accordance with international custom that States in time of peace have a right to send their warships through straits used for international navigation between two parts of the high seas without the previous authorization of a coastal State, provided that the passage is innocent. Unless otherwise prescribed in an international convention, there is no right for a coastal State to prohibit such passage through straits in time of peace."
McLaughlin argues that because the ICJ’s judgment was limited to the issue of warship passage through international straits, the subject matter of the Corfu Channel case is now governed by the regime of ‘transit passage’ and not of that of innocent passage.
A more recent incident took place at the Yellow Sea. At November, 10th Two Korean naval ships clashed and exchanged fire leaving the North Korean patrol ship set on fire. In peacetime the regime of innocent passage would be applicable here, because South Korea claimed the North Korean vessel was entering its territorial waters. The South Korean ships fired several warning shots after a patrol vessel crossed a disputed maritime border in the Yellow Sea off the west coast of the peninsula, said Seoul's joint chiefs of staff. Unfortunately the Koreas are still at war...
McLaughlin continues to explain two different schools concerning innocent passage. Some consider innocent passage as a concession of the coastal state; the implication would be that regimes require prior notification and authorisation for warship passage. Others prefer to characterise the territorial sea as part of the oceans and seas, the right of innocent passage must be viewed as an internationally defined and allocated right. The consequence is that regimes of prior approval for warship passage would be inconsistent with the nature of the territorial sea. (page 109).
Source: McLaughlin, R., United Nations naval peace operations in the territorial sea, Leiden : Martinus Nijhoff Publishers, 2009, XIV, 260 p
Books and articles in the Peace Palace Library Catalogue about innocent passage
Books and articles in the Peace Palace Library Catalogue about transit passage
Relevant articles United Nations Convention on the Law of the Sea about transit passage