Changes to arbitration law in England and Wales – Arbitration Act 2025 explained

The new Arbitration Act 2025 amends the Arbitration Act 1996 in several ways.

The changes mostly centre around arbitrators themselves. These reflect the way the role of the arbitrator has become increasingly professionalised since the 1990s.

The changes are necessary, but at the same time are a testament to how well the 1996 Act is written and how well it has stood the test of time.

Duty of disclosure of arbitrators

Arbitrators now have a statutory duty of disclosure. This requires them to tell parties about any circumstances which might lead to justifiable doubts about their impartiality.

This is in line with the greater complexity of the modern world, and the greater number of professional arbitrators taking on a larger number of cases. There must be clarity over the ways lines might be crossed and potential biases thereby created.

Statutory immunity of arbitrators

The statutory immunity of arbitrators has been strengthened. In particular, the changes:

• eliminate the possibility of costs orders being made against arbitrators if they are removed by the courts (except if they are removed on the grounds of bad faith)
• clarify that arbitrators have no liability if they resign (unless the resignation was unreasonable, and subject to the possibility of having to repay fees and expenses already received)

Powers of arbitrators to make summary awards

The new Act bolsters arbitrators’ powers to make awards on a summary basis.

Technically, the Act clarifies these powers, because they existed before. But the clarification is helpful, nonetheless.

Applicable law, emergency arbitration and jurisdictional challenges

The amendments also grapple with thorny issues that have arisen in various cases before the courts over the past thirty years.

The new Act clarifies what law is applicable to an arbitration agreement.

An arbitration agreement stands as a separate contract within a main contract, even though it may be written merely as one clause among many others. It can therefore be subject to a different governing law compared to the other clauses.

The new Act provides that, in the absence of an express agreement by the parties, the law applicable to the arbitration agreement shall be the law of the seat of the arbitration.

The new Act also brings certainty to the status of emergency arbitrators and their orders.

The role of emergency arbitrator was invented in the early 2000s, so was not around when the 1996 Act was written. The new Act makes orders of an emergency arbitrator enforceable through the courts.

Finally, the new Act will change how courts deal with challenges to arbitration awards on the grounds of jurisdiction.

In particular, it indicates that a court dealing with a jurisdictional challenge cannot rehear evidence that has already been considered by a tribunal. However, the Act is only the starting point for this change. It will be left to court rules to work out the details.

Other changes

The new Act also:

• clarifies how to calculate the time-period during which a challenge to an award may be filed
• sets out the powers of a court over third parties who may play some role in an arbitration
• removes the potential for overlap between the jurisdiction of the tribunal and the jurisdiction of the courts in relation to preliminary points
• eliminates the sections of the 1996 relating to domestic arbitration agreements which were never brought into force

Reflections on the changes

All of these changes are welcome. They help to bring arbitration law in England and Wales up to date and in line with the requirements of the 2020s.

However, they are not transformative. Arbitration in this jurisdiction has been fine-tuned, not overhauled.

That is not an error or a missed opportunity on the part of today’s parliament. Rather, it is a tribute to how well parliament did its job in the 1990s – especially by drawing on the advice of an eminent Departmental Advisory Committee. There is, in truth, little that is wrong with the 1996 Act, and a great deal to admire about it.

Such praise must come with a caveat, however. The 1996 Act was written in the context of the business needs of its time. The 2025 Act has been written in the context of today.

But what changes are around the corner?

The pace of technological advancement is picking up. Commercial ventures are already being established that offer ‘AI arbitrators’.

One can debate whether such technology is as good as the human version (I do not think it is) but it is already here and it poses new challenges for the Act. These challenges will become all the more urgent as the technology improves even further (I do think it will).

It is a fair bet to say that we will not be waiting another thirty years before more changes are needed.