Syed Rahman looks at some of the changes brought about by the Arbitration Act 2025 and how London-seated arbitrations may be conducted differently in light of the changes.
The new Arbitration Act 2025 came into force on 1 August 2025.
The Act has been making it’s way through Parliament since the Law Commission published its final report in September 2023.
The new Act does not replace the Arbitration Act 1996. Instead, it makes a few amendments, in line with the Law Commissions findings from its public consultations. Now the 1996 Act and the 2025 Act should be read together.
Here we summarise the key changes brought about by the new Act, and explain how it will affect arbitrations in the UK.
Summary disposal
Tribunals may now decide a claim or issue without a hearing, in the same way that a judge can grant a party summary judgment.
Parties may now apply to the tribunal to request summary disposal of proceedings. It will be awarded if the tribunal considers that a party has no real prospect of succeeding on a claim or issue, or defending it. The parties must be given reasonable opportunity to make representations to the tribunal before summary disposal is granted.
This change is designed to save time and costs in cases where a party has a weak prospect of success on an issue, or on the entire claim.
Previously, the position was that arbitrators were under a duty to adopt procedures which avoid unnecessary delay and expense, so in theory they had an implicit power to use summary disposal. However, without an express power, they had to weigh this against their duty to give each party a reasonable opportunity to put their case.
Default rule for the Governing Law
The law that applies to the arbitration agreement will be the law that the parties have expressly agreed. However, if the parties have not agreed the governing law, It will be the law of the seat of the arbitration in question.
The law in this area was left slightly confused by the Supreme Court decision in Enka v Chubb [2020] UKSC 38. Now, if there’s a London-seated arbitration and the parties have not agreed the governing law, the laws of England & Wales will apply.
The governing law of the main contract does not constitute express agreement that that law also applies to the arbitration agreement.
Duty of disclosure for arbitrators
Arbitrators have to disclose any circumstances that might give rise to doubts about their impartiality. This is an ongoing duty on the arbitrator(s) throughout the entirety of the proceedings.
Extended court powers in support of arbitral proceedings
Section 44 of the Arbitration Act 1996 sets out the powers that a court can exercise in support of arbitral proceedings. For example, the court has the power to make orders for (i) the preservation of evidence (ii) the sale of goods, and (iii) the appointment of a receiver.
Section 44 order could be made against the parties to the arbitration. The Arbitration Act 2025 makes it clear that these orders can be made against third parties too.
Section 67 challenges to awards on grounds of jurisdiction
Challenges to the tribunal’s award on the grounds of jurisdiction must no longer take place as a full rehearing. Instead they will be a review.
The court will not consider any new grounds of objection, or any new evidence, unless the applicant could not (with reasonable diligence) have discovered that ground or evidence before the tribunal.
Evidence that was heard by the tribunal will not be reheard by the court.
The Law Commission highlighted that a full rehearing has the potential to cause delay and increase costs through repetition. And a full rehearing raises “a basic question of fairness.” The amendment has now clarified and expedited the procedure.
