The Arbitration Act 2025 - Modernising Arbitration

The Arbitration Act 2025 (“2025 Act”) marks the most significant statutory refinement to the UK arbitration framework in nearly three decades. Receiving Royal Assent in February 2025 and brought into force in August of the same year, the 2025 Act updates the Arbitration Act 1996 with targeted reforms designed to enhance legal clarity, procedural efficiency, and England’s attractiveness as a seat for international arbitration.

Clarity on the Governing Law of Arbitration Agreements

One of the most consequential reforms is the introduction of a statutory rule on the law governing arbitration agreements. Under the 1996 Act, the applicable law was determined through a multi-stage common law test arising from Enka v Chubb — a test that, in practice, often yielded complexity and uncertainty. The 2025 Act now provides that, absent an express choice by the parties, the law of the seat of arbitration will govern the arbitration agreement.

This clear, seat-based default benefits commercial parties by aligning the law governing the arbitration clause with the jurisdiction most closely connected to its procedural context, typically, where interim measures and enforcement will be sought. It underscores the strategic importance of drafting arbitration clauses with express choice-of-law language.

Summary Disposal Powers

Arbitration has traditionally been valorised for finality and flexibility, but without clear mechanisms to address claims or defences devoid of merit early in the process. The 2025 Act introduces an express power for tribunals to issue summary awards, permitting dismissal of a claim, defence, or issue that has “no real prospect of succeeding.”

This power mirrors the familiar English court test for summary judgment and has the potential to reduce cost and delay in arbitrations where certain issues are plainly unsustainable.

Arbitrator Disclosure Duties

The role of the arbitrator has progressively professionalised through practice and institutional rules. The 2025 Act enshrines in statute an obligation for arbitrators to disclose any circumstances that might reasonably give rise to justifiable doubts about their impartiality or independence.

This codification aligns statutory law with established best practice, such as that reflected in the LCIA Rules, and reinforces procedural legitimacy. The duty is continuing and mandatory, applying before and during an appointment unless expressly agreed otherwise.

Enhanced Court Support for Arbitration

The courts retain an essential supervisory role, and the 2025 Act clarifies and, in some respects, strengthens that role. Reform includes:

• Improved enforcement mechanisms for emergency arbitrator orders;

• Expanded power for courts to issue orders against third parties, such as for preserving evidence; and

• A clear right of appeal for third parties affected by certain court orders, without the need for leave.

These developments reflect a calibrated balance: maintaining arbitration’s autonomy while ensuring that essential judicial support operates efficiently and predictably.

Procedural and Jurisdictional Refinements

The 2025 Act also amends how jurisdictional challenges are handled, limiting the scope for re-litigation of issues that could have been put before the tribunal with reasonable diligence. There are also refinements to applications on preliminary questions of law and jurisdiction, designed to streamline interaction between arbitral tribunals and the courts.

Conclusion: Evolution, Not Revolution

The Arbitration Act 2025 does not overturn the fundamental architecture of the 1996 Act. Rather, it modernises and sharpens the legislative framework.

For commercial parties and practitioners, the 2025 Act offers greater predictability and procedural tools that, if understood and deployed with intent, can enhance case strategy and risk management.

Speak to a Solicitor today

If you require any assistance or would like to find out your options in relation Arbitration, please contact us by sending an email to info@lyoncroft.co.uk, calling us on 020 3576 7170 or completing a contact-us form.

This article has been authored by Abdullah Suker, Managing Director of Lyon Croft Law.