The Arbitration Act 2025: Key Changes
Introduction
The Arbitration Act 1996 has served the UK well: it put party autonomy at the centre, limited court intervention, and gave London and other UK seats an enviable international reputation. Almost three decades on, however, practice has evolved. Digital evidence, third party funding, emergency relief, and transparency expectations have all out paced the 1996 framework.
Enter the Arbitration Act 2025 (“the 2025 Act”). Building on the Law Commission’s 2023–24 review and extensive stakeholder consultation, the new legislation updates and streamlines much of the 1996 Act while preserving its core philosophy. Below, we explain the major changes, why they matter, and how they are likely to benefit parties, practitioners, and UK business as a whole.
Digital First Arbitration
What changed?
Electronic documents & e signatures are now expressly recognised as valid for arbitration agreements and awards;
remote hearings are given statutory footing. Tribunals can order hybrid or fully virtual hearings without needing the parties’ consent, provided they consider procedural fairness; and
digital service of documents is the default unless parties opt out.
Why it matters
The 1996 Act was drafted when faxes were still in use. The 2025 Act removes any lingering doubt that an e signed arbitration clause or a PDF award is fully valid. Tribunals now have certainty that they can conduct the entire proceeding virtually if appropriate, which can save time and costs—especially for parties located in multiple jurisdictions.
Emergency Arbitrators and Interim Relief
What changed?
Parties may apply for an Emergency Arbitrator before a tribunal is formed;
interim measures (asset freezes, evidence preservation, ) ordered by Emergency Arbitrators are enforceable in the same way as tribunal orders; and
UK courts retain a supportive role but will only step in if the Emergency Arbitrator procedure is inadequate or impossible in the circumstances.
Why it matters
Commercial urgency often arises long before a tribunal is in place. Until now, parties typically rushed to court for urgent injunctions, undermining the “minimal court intervention” ethos. The 2025 Act aligns the UK with institutions like the ICC and SIAC which already offer emergency arbitration. It gives parties rapid, specialist relief while keeping the dispute within the arbitral framework.
Summary Disposal Power
What changed?
Tribunals now have an express statutory power to dismiss claims or defences that are “manifestly without merit”; and
the threshold and procedure mirror civil court summary judgment but remain flexible.
Why it matters
Weak claims can delay proceedings and inflate costs. The 1996 Act was silent, so tribunals hesitated to dispose of them early for fear of a due process challenge. By codifying summary disposal, the 2025 Act clarifies tribunal powers, encourages efficiency, and deters tactical, unmeritorious arguments.
Clarified Law on Confidentiality
What changed?
The 1996 Act never codified confidentiality; English case law filled the gap, but uncertainly. The 2025 Act now contains a default confidentiality rule with a clear list of exceptions (e.g., consent, court enforcement, legal duty, or to protect a party’s legal rights); and
courts may make confidentiality orders when hearing arbitration related applications.
Why it matters
Users value arbitration’s privacy but were previously left to piece together the law from cases like Dolling Baker v Merrett [1990] 1 WLR 1205. The new statutory rule provides predictability. Exceptions strike a balance between privacy and transparency (e.g., allowing limited disclosure for regulatory reporting).
Independence and Impartiality of Arbitrators
What changed?
The duty of impartiality is retained and clarified. Arbitrators must now disclose “any circumstances that might reasonably give rise to doubts” about independence before acceptance and throughout the arbitration;
failure to disclose allows challenge within 30 days of discovering the undisclosed facts; and
the test for apparent bias adopts the Supreme Court’s Halliburton Company v Chubb Bermuda Insurance Ltd [2020] UKSC 48 formulation: whether a fair minded and informed observer would conclude there is a real possibility of bias.
Why it matters
The 2020 Halliburton decision generated uncertainty about multiple appointments and disclosure. Enshrining the test and ongoing duty reduces ambiguity, gives arbitrators clear guidance, and protects parties’ perception of fairness.
Appeals on Points of Law—Section 69 Re imagined
What changed?
Parties may still exclude appeals on a point of law, but the default right is narrowed:
The question must be of general public importance; or
Pervasively affect the rights of third parties.
Leave to appeal will not be granted if the tribunal gave the right result (even if by different reasoning).
Why it matters
Section 69 appeals have been popular with domestic cases but criticised internationally as undermining finality. Tightening the gateway is intended to keep England attractive for international users who prize certainty, while maintaining a safety valve for issues of real public significance (e.g., standard form shipping clauses). However, it is arguable that the pendulum has swung too far, making it too difficult to reverse aberrant decisions.
Third Party Funding Transparency
What changed?
Parties must disclose the existence (not terms) of any third party funding arrangement, including identity of the funder, within 21 days of commencement; and
tribunals may order costs against funders in limited circumstances (e.g., misconduct or non payment of an adverse costs order).
Why it matters
Funding has exploded since 1996 but can raise conflict and enforcement issues. Mandatory disclosure helps arbitrators assess potential bias and security for costs applications. Limited funder liability discourages frivolous claims without deterring responsible funding.
Costs, Security for Costs, and Non Party Costs Orders
What changed?
Statutory confirmation that tribunals may order security for costs and require payment into escrow or a guarantee
tribunals can make non party costs orders against bad faith funders or controllers; and
costs follow the event unless parties agree otherwise, aligning arbitration with mainstream commercial litigation norms.
Why it matters
These clarifications reinforce tribunal authority, prevent tactical default or insolvency gambits, and encourage parties to behave realistically about risk.
Enforcement and Setting Aside
What changed?
Grounds for setting aside an award largely follow UNCITRAL but now include a 90 day limitation period (previously 3 months, now expressed in days for certainty) and an express power for courts to remit rather than set aside where appropriate;
the 2025 Act codifies that errors in form (e.g., clerical) are curable and do not invalidate an award; and
electronic awards may be enforced under the New York Convention without a paper original.
Why it matters
Shorter, clearer timelines reduce satellite litigation. Remission preserves the tribunal’s work while allowing correction. Electronic enforcement reflects contemporary practice and removes needless formality.
Modernised Court Support
What changed?
The Commercial Court and Business & Property Courts retain jurisdiction for most supervisory matters, but certain applications (e.g. witness summonses for documents) can now be dealt with on the papers to speed up ancillary relief; and
a new “Arbitration List” digital filing portal streamlines applications and bundles.
Why it matters
Court support remains quick and specialist, reinforcing the UK’s “arbitration friendly” reputation.
Small and SME Friendly Measures
What changed?
Arbitrations under £250,000 in dispute value may adopt an Expedited Procedure unless parties opt out; and
fees must be proportionate; tribunals encouraged to cap recoverable costs absent exceptional grounds.
Why it matters
SMEs often avoid arbitration due to perceived cost. Expedited rules mirror ICC and LCIA fast track , making arbitration a viable mid market option and relieving pressure on county courts.
Transitional Provisions
The 2025 Act applies to arbitrations commenced on or after 1 January 2026 unless parties expressly opt in earlier; and
continuing arbitrations still proceed under the 1996 Act, but parties may jointly elect to adopt the new provisions for procedural steps.
Benefits in a Nutshell
Efficiency – Summary disposal, digital hearings, and short court timelines cut delay and cost.
Modernity – Electronic signatures, online portals, and digital awards align the law with practice.
Finality and Confidence – Clear bias rules, narrowed appeals, and enforceable emergency orders protect party autonomy.
Transparency and Fairness – TPF disclosure and confidentiality codification strike a balanced, predictable framework.
Global Competitiveness – The UK stays at the forefront of international dispute resolution, offering a modern statute that rivals Singapore and Paris while retaining English legal rigor.
Conclusion
The Arbitration Act 2025 is an evolutionary, not revolutionary, update—yet its impact is likely to be significant. By addressing procedural bottlenecks, embracing digital tools, clarifying key doctrines, and enhancing tribunal powers, the Act safeguards the UK’s status as a premier arbitration venue. Parties can now expect faster, clearer, and more predictable arbitration, while courts will see fewer but more focus challenges. In short, the 2025 Act seeks to deliver a modern, business friendly framework which balances efficiency with the hallmark fairness of English arbitration.
This article is intended for information purposes only and provides a general overview of the relevant legal topic. It does not constitute legal advice and should not be relied upon as such. While we strive for accuracy, the law is subject to change, and we cannot guarantee that the information is current or applicable to specific circumstances. Costigan King accepts no liability for any reliance placed on this material. For further details concerning the subject of the article or for specific advice, please contact a member of our team.
Julian Critchlow
Disputes Specialist
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