Arbitration Act 2025: Welcome Progress or Missed Opportunity?

Setting the Scene: Why Reform Was Needed

The Arbitration Act 1996 has long been regarded as a gold standard for arbitration legislation. Its clarity, commercial sensibility and emphasis on party autonomy, coupled with minimal court intervention, have helped establish London as a pre-eminent arbitration hub. But the international landscape has evolved. Jurisdictions such as Singapore, Hong Kong and Paris have modernised their regimes by investing heavily in legal infrastructure and marketing themselves as arbitration-friendly destinations. Against this backdrop, the Act arrives as a much-needed refresh.

Major Reforms: What Has Changed?

The Act makes several significant improvements.

• Summary Disposal Power

One of the most notable innovations is the introduction of a statutory summary disposal power under section 39A. Arbitrators now have the statutory authority to dismiss any issue, claim, or defence with "no real prospect of success". This mirrors the threshold under the English Civil Procedure Rules. This reform is aimed at enhancing efficiency by confirming the ability of tribunals to dispose of weak claims early. However, the adoption of an English court test has raised concerns, particularly regarding its suitability for international arbitrations and its interaction with due process principles.

• Governing Law of the Arbitration Agreement

Section 6A addresses a longstanding question: which law governs an arbitration agreement when the main contract and the seat of arbitration are subject to different legal systems? The new provision clarifies that, unless the parties expressly agree otherwise, the law of the seat will govern. This marks a departure from the UK Supreme Court’s ruling in Enka v Chubb.

• Jurisdictional Challenges

The Act amends section 67 proceedings by restricting parties from rearguing jurisdictional issues that the tribunal has already determined. Courts are now required to decide these challenges using the existing arbitral record, unless the applicant demonstrates that new evidence could not have been obtained with reasonable diligence. This reform aims to curb tactical delays and prevent unnecessary re-litigation.

• Codification of Arbitrator Disclosure Duties

In response to the Supreme Court’s decision in Halliburton v Chubb, the Act creates a statutory duty for arbitrators to disclose circumstances that might reasonably give rise to doubts as to their impartiality. It is hoped that this will strengthen user confidence in the fairness and integrity of the system.

• Emergency Arbitrator Provisions and Court Support

The Act strengthens the enforceability of emergency arbitrator decisions and affirms the courts' authority to grant interim relief against third parties. These updates bring English arbitration law in line with contemporary practice and offer valuable mechanisms for handling urgent matters.

• Arbitrator Immunity

The Act provides enhanced protection for arbitrators from liability arising from their resignation or from applications seeking their removal, except in cases of bad faith. This reform promotes arbitrator independence and mitigates the deterrent effect of potential litigation.

Lingering Gaps: Where Does the Act Fall Short?

While the reforms are welcome, the Act is evolutionary rather than revolutionary. Several important areas remain unaddressed. This leaves questions about whether England is truly future-proofing its arbitration regime.

• Artificial Intelligence and Technology in Arbitration

Perhaps the most glaring omission is the absence of any reference to artificial intelligence. Generative AI tools are already influencing how parties prepare submissions, how arbitrators assess evidence and even how draft awards are generated. Some jurisdictions and arbitral institutions have begun issuing guidance on AI use, recognising the need for transparency and integrity. Should arbitrators or parties be required to disclose their use of AI? How do we ensure the integrity of awards generated or influenced by non-human inputs? These are not theoretical questions.  They are pressing and practical. The Act’s silence on this front feels like a missed opportunity to lead on a rapidly evolving issue.

• Tribunal Secretaries and Delegation

Although the use of tribunal secretaries has become increasingly common – and cases such as P v Q have fuelled debate on the issue – the Act remains silent on their appointment, functions and regulation. It provides no guidance on the scope of their permissible duties, their obligation to disclose potential conflicts of interest, or whether they should enjoy arbitral immunity. As more substantive tasks are delegated to secretaries in complex proceedings, this legislative silence creates an expanding regulatory gap.

• Summary Disposal – Still Some Wrinkles

The inclusion of a statutory power for summary disposal is a welcome development. But its drafting raises certain concerns. The chosen test of "no real prospect of success", drawn from English litigation, departs from the "manifestly without merit" standard commonly adopted by arbitral institutions and increasingly recognised as the international norm. As a result, international counsel involved in arbitrations seated in England will need to monitor developments in English procedural law governing summary dispositions. The drafters of the Act might have achieved greater coherence by aligning with the internationally accepted standard and granting tribunals discretion to select the appropriate threshold based on the specific context of each case.

• Sanctions and Arbitration

The Act is likewise silent on whether arbitral proceedings should be exempt from the operation of sanctions regimes. This issue has gained significance amid the expanding role of sanctions in international relations and their profound effects on global trade and finance. The European Union has already taken steps in this direction. Given London’s position as a leading centre for international dispute resolution, the absence of clear guidance may place England at a competitive disadvantage as a preferred seat of arbitration.