Iran is accused of seizing a merchant ship that was in contact with Israel as it passed through the Strait of Hormuz early Saturday morning.
MSC Aries was boarded by Iranian special forces about 50 miles (80 km) off the coast of the United Arab Emirates, MSC's statement said.
Footage obtained by Reuters shows troops attacking the ship from a helicopter.
The Portuguese-flagged vessel has been linked to Israeli billionaire Eyal Ofer.
The incident comes amid heightened expectations of an Iranian attack on Israel after an airstrike destroyed Iran's embassy in Damascus in early April. Israel said on Saturday that Iran would bear the consequences if it chose to escalate the situation further.
Tracking data last showed the MSC Aries off the coast of the United Arab Emirates heading towards the Strait of Hormuz 18 hours ago. It then appeared to freeze its tracking data, which is typical of Israeli-aligned ships in the region.
The UK's Maritime and Commercial Operations Agency confirmed the boarding in a statement. It made no mention of Iranian intervention, instead saying the vessel was seized by “regional authorities” off the coast of Fujairah in the United Arab Emirates.
However, Iranian media have trumpeted the involvement of the country's special forces in the attack.
The Islamic Revolutionary Guard Corps' (IRGC) naval branch seized the MSC Aries “because it was linked to Israel,” the country's state news agency IRNA reported. It is also reported that the ship is in the process of being transported to Iranian waters.
In video footage, troops can be seen attacking the ship from a helicopter. A crew member could be heard yelling, “Don't come out.”
In the video, a commando can also be seen kneeling and taking cover as other troops board the ship. According to MSC, 25 crew members were on board at the time of the seizure.
Officials in Tehran have yet to comment on the seizure.
The vessel is managed by MSC, which leases the vessel from Gortal Shipping Inc, an affiliate of Mr Ofer's Zodiac Maritime.
US warns of attack on Iran
Iranian forces have carried out a series of vessel seizures in the region since 2019 and the attack comes amid rising tensions between Iran and Israel.
Since an April 1 attack on the Iranian consulate building in Damascus that killed a senior IRGC commander, Iran has vowed to hit back at Israel.
While Israel has refused to comment on the attack, US officials have repeatedly warned that Iran expects to attack Israel “soon”.
“We are committed to the defense of Israel. We will support Israel,” Mr Biden said. “We will help defend Israel and Iran will not win.”
A spokesman for Israel's military said on Saturday that Iran “will bear the consequences if it chooses to further escalate the situation”.
Meanwhile, Dutch media reported that KLM airline will no longer fly over Iran due to rising regional tensions.