Arbitration Act 2025 receives Royal Assent

The Arbitration Act 2025 (“AA 2025”) received Royal Assent on 24 February 2025.

Beyond amending and updating The Arbitration Act 1996 (“AA 1996”), the intention behind AA 2025, is to drive efficiencies and further business confidence in the arbitration process in the U.K., so that London and the U.K. remain amongst the preferred worldwide arbitral seats.

AA 2025 follows the Law Commission’s 2022/2023 proposals for reform of AA 1996 (as considered in our previous article Arbitration Act 1996 under review. Amongst the significant amendments to AA 1996, on coming into force AA 2025 will:

• Clarify the applicable law governing arbitration agreements, by introducing a default rule that where the parties do not specify the governing law within the arbitration agreement, it will be governed by the law of the seat chosen for the arbitration.
• Grant tribunals powers to make awards on a summary basis. To further efficiencies and save costs, parties may now apply to the tribunal to dispose of the counterparty’s statement of claim or defence and make an award on a summary basis, where they can establish that counterparty has “no real prospect of succeeding“.
• Promote impartiality by imposing a duty of disclosure on Arbitrators to disclose any potential conflicts of interest and any relevant circumstances that may reasonably “give rise to justifiable doubts as to their impartiality in relation to the [arbitral] proceedings, or potential proceedings concerned”.
• Provide greater Arbitrator immunity against liability for their resignations and from paying the costs of any application for their removal; unless such resignation was unreasonable or, where the Arbitrator has acted in bad faith.
• Allow Emergency Arbitrators to issue peremptory orders and grant interim relief within an arbitration, with the same means and routes available to enforce their orders as with other Arbitrators.
• Give greater scope for the court to make orders in support of arbitral proceedings or “Section 44 Orders” including orders against third parties.
• Prevent parties from challenging the arbitration’s jurisdiction where the tribunal has already ruled on that issue within the arbitration.
• Prevent parties from challenging an arbitration award based on the tribunal’s substantive jurisdiction in making any award, where such an application/challenge relies on new grounds or evidence that were not previously raised and put before the tribunal.
• Clarify the time period for challenging an arbitration award; being now 28 days from the date the applicant/appellant party was notified of the conclusion of the initial arbitral process or appeal (as opposed to from the ‘date of the award’ as is the current position under AA 1996).

What happens next?

The provisions of AA 2025 will into force shortly (on such day as the Secretary of State may by further regulations appoint). We will keep you posted on the same. The provisions of AA 2025 will then apply to all arbitrations commenced in the U.K. following the date of its coming into force.

How we can help

For further help and advice on resolving disputes through arbitration contact our arbitration team who will be able to provide the necessary advice and assistance.