The Arbitration Act 2025 comes into force

The Arbitration Act 2025 came into force on 01 August 2025.

What changes does it make?

The 2025 Act includes a number of significant changes to the 1996 Act, the most important of which are summarised below.

Summary disposal

The 1996 Act is amended to allow tribunals, subject to the parties' agreement, to issue an award on a summary basis. This will mirror the ability of the courts to dispose of meritless claims or defences without incurring the time and expense of a full trial. The threshold chosen by the Commission, of "no real prospect of success", mirrors the well-established test in English court proceedings. We expect many parties will seek to exclude any such determination of their claims or defences in their arbitration agreements.

Court support

The 1996 Act is amended to make clear that the courts can make orders in support of arbitration that include orders against third parties. Most consider that section 44 of the 1996 Act already contained this power, but the case law is mixed so clarification can only be welcome. The 2025 Act further recommends that the courts should be able to make orders for compliance with orders made by emergency arbitrators. This will give real teeth to the emergency arbitrator provisions of many institutional rules, which are currently often excluded by parties, so as to ensure they can apply directly to court for injunctive relief if interim awards from emergency arbitrators are not followed.

Law of the arbitration agreement

Following the Supreme Court decision in Enka v Chubb, many respondents to the initial Law Commission consultations indicated that the question of the law of the arbitration agreement would be better addressed in legislation. Until the 2025 Act comes into force, where no law of the arbitration agreement is specified, it is likely that the law of the main contract will govern the arbitration agreement, regardless of where the seat of the arbitration is located. There is logic in this, in that the whole contract is governed by one law, but it complicates the position with respect to an arbitration seated in England & Wales.

The 1996 Act is now amended to provide that, where the parties do not specify the governing law of the arbitration agreement, it will be the law of the seat. An interesting example of how this may affect matters in practice can be seen in the recent Supreme Court decision in UniCredit v RusChemAlliance (for more on which see here and here). The arbitration agreement in question there specified a Paris seat, but the English courts found the governing law of the arbitration agreement to be that of the overall contract, which was English law. That would now be decided differently and the English courts would likely not have granted anti-suit relief.

Other changes

The 2025 Act also introduces a number of other changes to the 1996 Act. These include:

1. The codification of arbitrators' continuing duty to disclose anything that might reasonably give rise to doubts as to their impartiality, as set out in the Supreme Court's 2020 decision in Halliburton v Chubb.

2. The extension of arbitrators' immunity under section 29 of the 1996 Act to cover circumstances in which an arbitrator has reasonably resigned and those in which a party applies to the court to remove an arbitrator.

3. The clarification of procedural rules regarding jurisdiction challenges under section 67 of the 1996 Act to provide that such challenges should take the form of appeals from the decision of the tribunal, rather than completely fresh hearings of the issue. New evidence will only be admissible if it could not have been submitted earlier with reasonable diligence.

What will not change?

Various other possible amendments to the 1996 Act were considered by the Law Commission, but not ultimately recommended. Perhaps most significantly, the 2025 Act does not create a statutory presumption of confidentiality for arbitrations seated in England & Wales. The Law Commission’s view was that this was unnecessary given that the parties can opt to make their arbitration confidential and that flexibility is key to the attraction of arbitration. The issue of arbitral confidentiality will therefore be left to the common law.

The Commission also decided against recommending a proposal to make discriminatory provisions in arbitration agreements unenforceable on the basis that few arbitration agreements contain discriminatory provisions and that such a change might introduce too much scope for parties to use it to delay or obstruct an arbitration. The Commission also did not adopt proposals to change the approach to appealing points of law under section 69 of the 1996 Act.

Impact

The 2025 Arbitration Act is more an exercise in incremental improvement than a substantial shift in approach. Few would argue that the 1996 Act has been anything other than a success story in promoting arbitration in the UK and promoting the UK as a centre for international arbitration. But London’s position as a leading seat for international arbitration is coming under increasing competition from other jurisdictions, such as Singapore. Many UK commentators have therefore welcomed the Government’s decision to update and refresh the 1996 Act in its first legislative session, in order to protect London’s reputation as a leading arbitral seat.