Arbitrations that have an English seat are governed by the Arbitration Act 1996 (as amended by the Arbitration Act 2025) (AA 1996). The AA 1996 provides a framework for arbitration procedures, and for supervisory support (where required) from the courts of England and Wales.
Parties to an arbitration can use the provisions of the AA 1996 to challenge the jurisdiction of the tribunal on various grounds.
In this article we look at the jurisdictional challenges that are available to the parties and why a party might make a challenge.
Does the tribunal have jurisdiction?
In broad terms, for a tribunal to have jurisdiction over a dispute (i) the parties must have a valid arbitration agreement in place between them, (ii) the tribunal must be correctly appointed and (iii) the arbitration agreement must be sufficiently broad in scope to include the claims and disputes referred under it.
These rules derive from section 30 of the AA 1996, which refers to the competence of the tribunal to rule on its own jurisdiction. It gives the arbitral tribunal power to rule on its own substantive jurisdiction as to:
- whether there is a valid arbitration agreement,
- whether the tribunal is properly constituted, and
- what matters have been submitted to arbitration in accordance with the arbitration agreement.
There may be additional requirements depending on the particular institution that is chosen and any rules they may have.
Validity of the arbitration agreement
Arbitration is a voluntary process and requires agreement from the parties (usually this agreement is made at the contractual stage prior to any dispute. This decision is binding once made). Parties cannot arbitrate their disputes unless there is a written agreement between them to do so. The agreement must be incorporated into the contract between the parties.
With that in mind, parties must make sure that they commence proceedings against the correct entity. International companies often have complex group structures. Parties must take care to begin the arbitration against the relevant entity, and make sure that the entity is party to the arbitration agreement.
Arbitration agreements can be challenged for their validity if it transpires that the agreement was concluded without relevant authority. This may happen when an agent concludes the agreement, in circumstances where the agent acts beyond their powers.
Some contracts will include a clause that submits disputes to both court and arbitration. Those clauses are often interpreted as referring the disputes to arbitration, with the specified court to exercise supervisory jurisdiction as the court of the seat.
The constitution of the tribunal
Section 30(b) AA 1996 refers to the constitution of the tribunal. The jurisdiction of the tribunal can be challenged if an incorrect number of arbitrators have been appointed. For example, has a sole arbitrator been appointed when the agreement specified three?
Secondly, did the parties follow the prescribed appointment procedure? The arbitration agreement may specify the appointment procedure, or it may refer the parties to particular institutional rules, which have a prescribed process for appointing arbitrators.
Matters submitted to arbitration
The arbitration agreement should be sufficiently wide to cover the dispute in the reference. The clause may cover “all disputes arising under the contract”, which is arguably narrower than “all disputes”, which may also include claims in tort.
However, the case of Fiona Trust & Holding Corporation & Ors v Privalov & Ors [2007] EWCA Civ 20 is authority that commercial parties are unlikely to have intended to "split" claims between court and arbitration, particularly parallel claims in contract and tort. This shows that the Courts will give a broad interpretation to the disputes clause where possible.
Why challenge jurisdiction?
Successfully challenging the jurisdiction of the tribunal means that any award made by that tribunal will not bind the parties.
An award may be set aside, or become unenforceable.
Claims may become time-barred
Extra caution should be taken over limitation issues. If a party commences arbitration within the limitation date, the claim could still become time-barred if it is later decided that the tribunal did not have jurisdiction.
If there is any ambiguity over jurisdiction, and the limitation date is approaching, the claimant may decide to issue a cautionary claim form in the court and then stay those proceedings while arbitration is pursued.
Challenging an award
Section 67 AA 1996 allows a party to apply to court to challenge an award on grounds of jurisdiction. This process is only open to parties once they have received an award from the tribunal. The award can be either:
- An award specifically addressing the issue of jurisdiction; or
- An award dealing with the parties' substantive dispute but which, a party believes the tribunal had no jurisdiction to make.
The party will make an application to the High Court, and the court may:
- Confirm the award
- Vary the award (and the variation then takes effect as part of the award)
- Remit the award to the tribunal, in whole or in part, for reconsideration
- Set aside the award, in whole or in part
- Declare the award to be of no effect, in whole or in part
It should be noted that it is rare for these challenges to be successful. The court takes a supervisory function in arbitration and does not readily intervene in case it undermines the finality of an award from the tribunal. The Commercial Court Report 2023-2024 records that only one section 67 challenge was successful that year, while 24 jurisdiction applications were filed.
Should you challenge jurisdiction?
Challenging the jurisdiction of the tribunal can delay the parties getting a binding award to the underlying dispute. It draws out the process and there are additional costs associated with a challenge. However, a successful challenge can set aside an award.
There are strict time limits within which to bring a jurisdictional challenge, which are set out in section 70 of the AA 1996. Delaying in making the challenge could mean that the party loses the right to object at all.
