The Arbitration Act 2025 received Royal Assent on 24 February 2025 and will inform, in many respects, how arbitrations seated in England & Wales are conducted.

The UK Government says that the new provisions introduced by the 2025 Act will keep the UK at the forefront as an arbitration centre and should provide a boost to the UK economy generally. The new Arbitration Act is intended to address some of the issues that has caused concern within the arbitration community over recent years and some of which became the subject of extensive litigation.

The 1996 Act, has not been repealed but the 2025 Act provides amendments to the 1996 Act which remains in force.

Here are some of the key changes introduced by the Arbitration Act 2025:

Summary Disposal

For the first time under English arbitration law, it is possible for a tribunal to issue an award on a summary basis where there is no reasonable prospect of a party succeeding on an issue. Until now a Tribunal has not able to dispose of an issue, claim or defence on a summary basis. This meant unmeritorious claims had to be seen through to the end of the usual arbitral process. This was time consuming and expensive. But now it will be possible to foreshorten the arbitral process in relations to unmeritorious claims and defences. The Tribunal will only be able to exercise this power on application from one of the parties. However, it does mean that hopeless claims or defences may be dispensed with at an early stage saving time and costs.

Notably, it brings English arbitration procedure in line with many other leading arbitration venues.

The Law Governing the Arbitration Agreement

The new Act will clarify how a tribunal is to determine the governing law of the arbitration agreement. A well drafted arbitration agreement will state clearly which governing law the arbitration agreement is to be subject. But often the arbitration agreement is silent on the point. Very often it is the same as the law which governs the principal agreement in which an arbitration sits, but not always. The new Act provides that the law which is to govern an arbitration agreement should be:

1. 1. The law the parties have expressly agreed should apply to the arbitration agreement; or

2. 2. If there is no such express agreement, the governing law of the arbitration agreement will be the law of the seat of the arbitration.

This should address some of the complexities that arose out of the decision in Enka -v- Chubb and will hopefully reduce the arguments, time and cost spent on which law should apply to the arbitration agreement.

Streamlining Challenges

Instead of a full rehearing, the court under the new Act should not hear any new grounds or evidence that had not been advanced before the Tribunal. This should save time and costs and prevent the party that lost the argument before the Tribunal from adducing new evidence before the court to better its position.

Immunity for Resigning Arbitrator

There should be no liability on an arbitrator that resigns from an arbitration unless the resignation was shown to be unreasonable. This should mean that reasonable resignations will not be deterred or discouraged by the risk of liability.

Arbitrator Disclosure

The new Act codifies the arbitrator’s duty to disclose any circumstances which might give rise to questions about their impartiality.

Orders made by Emergency Arbitrators

The Courts of England & Wales will be able to support the enforcement of orders made by emergency arbitrators.

The reforms introduced by the Arbitration Act 2025 are welcomed and will provide a much more effective and efficient arbitral regime in England & Wales. This should ensure London maintains its position as one of the most important arbitration centres in the World.

Related Expertise

Disclaimer: This publication is provided by Laytons LLP for informational purposes only. The information contained in this publication should not be construed as legal advice. While reasonable care is taken to ensure accuracy, the materials may not reflect the most current legal developments. Any questions or further information regarding the matters discussed in this publication can be directed to Laytons LLP and its Arbitration team.