The Arbitration Act 2025 (the “2025 Act”) received royal assent on 24 February 2025. The 2025 Act is the culmination of a multi-year review process by the Law Commission in England and Wales that included two consultation papers, as well as a final report with a proposed bill. The Bill was initially introduced in November 2023, but its progress was delayed when Parliament was prorogued for the general election in 2024. The Bill was re-introduced shortly after the King’s Speech in 2024. Its final reading was on 11 February 2025.
Given the Law Commission’s conclusion that the 1996 Act “works well”, the 2025 Act is not a significant departure from the framework established in the 1996 Act, but those changes that have been made provide some welcome clarity in the light of recent decisions of the English Courts in arbitration matters and confirm the pro-arbitration stance of the jurisdiction. These changes include a new default rule on the law governing an arbitration agreement, new rules of court in relation to jurisdictional challenges, and a codification of arbitrator disclosure duties. The 2025 Act also clarifies a number of procedural elements in relation to the Courts’ involvement in arbitration, in particular to address developments in arbitral procedure since 1996.
The Law of the Arbitration Agreement
Perhaps the most significant (certainly for arbitration practitioners) change is to prescribe a new default rule for determining the law applicable to an arbitration agreement. Unless the arbitration agreement is found in a treaty or foreign legislation, the law governing an arbitration agreement will be the law the parties have expressly agreed will govern the agreement, or absent such agreement, the law of the seat of arbitration. This amendment was made in response to criticism of the Supreme Court’s Enka v Chubb decision, which had previously set out a list of complex principles for determining the governing law of an arbitration agreement. The Law Commission felt that a clear-cut default rule would be easier and more consistently applied.
Jurisdictional Challenges
The 2025 Act also revises the framework for jurisdictional challenges brought under Section 67 of the 1996 Act, which allows parties to challenge an arbitral award on the basis that the tribunal lacked jurisdiction. This is in response to Dallah v Pakistan, in which the Supreme Court held that Section 67 requires a full rehearing of the jurisdictional question. A considerable number of stakeholders viewed this process as unnecessarily increasing costs and delays and further allowing a party that had previously made jurisdictional objections a second bite at the cherry. To address these criticisms, the 2025 Act proposes a new process under which the court will not entertain new jurisdictional objections or new evidence (unless it could not have been put before the tribunal even with reasonable diligence), and the evidence put before the tribunal will not be reheard by the court (unless in the interests of justice).
Arbitrator Disclosure
The Supreme Court’s decision in Halliburton v Chubb is also now reflected in the 2025 Act. An arbitrator now has a statutory duty to disclose any circumstances that reasonably give rise to doubts as to their impartiality. This duty applies both to situations known to the arbitrator and matters the arbitrator should reasonably know. The duty to disclose applies to pre-appointment discussions, rather than only to disclosures made at the time of appointment.
Emergency Arbitration and Summary Disposal
The 2025 Act also addresses two practices that have become more popular in many sets of arbitration rules and in legislation promulgated internationally in the period since the 1996 Act was passed—emergency arbitrators and summary disposal. The 2025 Act now allows courts to enforce an emergency arbitrator's interim orders and also allows emergency arbitrators to give permission for arbitral parties to apply to the court for an order in support of arbitration under section 44(4) of the 1996 Act. In relation to summary disposal, the 2024 Act clarifies that, unless the parties agree otherwise, the tribunal has the power to decide an issue on a summary basis if a party has “no real prospect” of success on that issue.
Next Steps
Now that 2025 Act has Royal Assent, the Secretary of State will appoint the day that the amendments to the 1996 Act take effect. Arbitrations commenced before the effective date will continue under the previous version of the 1996 Act, including court challenges in those arbitral proceedings.
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