The Arbitration Act 2025 introduces important updates to arbitration law in England and Wales, refining the framework established by the Arbitration Act 1996. Rather than replacing the 1996 Act, the new legislation amends and modernises it, ensuring that England and Wales remain a leading jurisdiction for arbitration. The Act’s provisions will come into force on a date set by the Secretary of State through regulations. Businesses, legal practitioners, and arbitrators should familiarise themselves with these changes to understand their impact on future disputes.
What are the key changes under the Arbitration Act 2025?
One of the most significant changes is the introduction of Section 6A, which clarifies the law governing arbitration agreements. Under the new provision, the law of the seat of arbitration will apply to the arbitration agreement unless the parties expressly agree otherwise. This reform moves away from the previous common law position, particularly the Supreme Court’s decision in Enka Insaat Ve Sanayi AS v OOO Insurance Company Chubb [2020], which held that, in the absence of an express choice, the governing law of the underlying contract would generally apply to the arbitration agreement. The new provision removes uncertainty and aligns the position with international best practice.
The Act also strengthens arbitrator immunity, ensuring that arbitrators cannot be held personally liable for decisions made in good faith, including resignations or jurisdictional rulings. This change is intended to protect arbitrators from unnecessary legal challenges, increasing confidence in the arbitration process and reducing procedural delays.
Another key reform is the introduction of provisions prohibiting discrimination in the selection of arbitrators. Under the new law, arbitrators cannot be chosen or excluded based on protected characteristics such as race, gender, or nationality. This is a significant step forward in promoting diversity and inclusivity in arbitration, ensuring that appointments are based on merit rather than bias.
The Act also clarifies the powers of the courts in supporting arbitration. Courts now have clearer authority to grant interim injunctions, including anti-suit injunctions, to prevent parallel proceedings in foreign courts. The new provisions also confirm that courts have the power to issue orders against non-parties, extending judicial support to arbitration cases where necessary. These changes reinforce the primacy of arbitration agreements, ensuring that parties cannot easily bypass arbitration by resorting to litigation.
To modernise arbitration law and improve efficiency, the Act includes provisions that update arbitration procedures to be compatible with modern technology. This allows for more streamlined and flexible dispute resolution, ensuring arbitration remains responsive to the needs of businesses. The Act also introduces measures to improve procedural efficiency, including explicit powers for tribunals to summarily dismiss unmeritorious claims and defences.
What are the transitional provisions?
The Arbitration Act 2025 includes transitional provisions to ensure a smooth implementation. Amendments introduced by sections 1 to 14 of the Act will not apply to arbitral proceedings that commenced before the new provisions come into force. Court proceedings relating to arbitration disputes initiated under the previous law will also remain unaffected. These measures provide continuity and prevent retrospective application of the new rules to existing cases.
What happens next?
With the Arbitration Act 2025 now enacted, businesses and arbitration practitioners should review their contracts and arbitration clauses to ensure they reflect the new legal framework. The Act’s clarifications on governing law, arbitrator immunity, and court powers will help make arbitration in England and Wales even more attractive as a dispute resolution mechanism. If you have any questions about how these changes may affect your arbitration agreements or ongoing disputes, contact our expert arbitration team today.
