The Arbitration Act 2025 comes into force today

In June, Beale & Co released an article on the new Arbitration Act 2025, outlining an in depth review of the changes coming into force by the new 2025 Act (which can be found here).

Today, the 2025 Act has come into force in the UK, introducing amendments to the long-standing Arbitration Act 1996, with a focus on improving the function of the arbitrator and improving the efficiency and fairness of the arbitration process.  Nadir Hasan and Cameron Baker provide a quick overview of what has changed – and what has not – in the Arbitration Act 2025.

What has changed?

• Governing law – Unless expressly agreed otherwise, the arbitration will be governed by the law of the seat of the arbitration (i.e., the jurisdiction where the arbitration takes place). This is a departure from the previous approach of considering if the parties had included an express or implied choice of law, and if not, applying the law which had ‘the closest and most real connection’ to the arbitration agreement.  The aim is to simplify and hopefully reduce the scope for dispute over the determination of the governing law of the arbitration.
• Summary awards – Tribunals will have the power to dismiss claims and/or issues with no real prospect of success, similar to summary judgment in court proceedings. The aim of this being to eliminate frivolous claims at an early stage and improve the efficiency of arbitration proceedings.
• Jurisdictional challenges – Previously, a tribunal could make a final award on the basis that it has jurisdiction, and an objecting party could then make an application to the court challenging this. The court would then make a ruling, effectively giving an objecting party ‘a second go’.  The 2025 Act confirms that evidence already heard by a tribunal should not be re-examined and the court should not consider new arguments or evidence (save for in exceptional circumstances).  The hope is that this will reduce the scope for inconsistency between the findings of tribunals and the courts, particularly on factual matters.
• Emergency arbitrators – Under the 2025 Act, emergency arbitrators will be able to issue enforceable orders such as interim injunctions.
• Arbitrator duties and immunity – The 2025 Act codifies an arbitrator’s continuing duty to disclose anything that may reasonably give rise to doubts as to their impartiality, including circumstances an arbitrator ‘ought reasonably to be aware of’. The 2025 Act also extends an arbitrator’s immunity under Section 29 of the 1996 Act to circumstances where an arbitrator has resigned or a party has applied to the court to remove an arbitrator, except if this is unreasonable or in cases of bad faith.
• Third party orders – The 2025 Act confirms that a tribunal can grant orders against a third party for: a) witness evidence b) the preservation of evidence; and c) the disclosure of documents relating to the dispute. This means that parties to an arbitration will be able to obtain orders for evidence from third parties without derailing the arbitration process.  This is key in complex construction disputes where many parties are involved.  A third party will be able to apply to the court to appeal any orders made.

What has not changed?

• Appeals on a point of law (Section 69) – Parties will still be allowed to appeal a decision on a point of law as per the 1996 Act – if the parties agree or permission is obtained from the courts. Parties can expressly exclude this right in the arbitration agreement.
• Confidentiality – The legislature decided not to codify the common law position that arbitrations are subject to a principle of confidentiality.
• Third party funding – A report of the Civil Justice Council released in June 2025 has decided that third party funding in arbitration should not be subject to formal regulation. Arbitral centres will determine how this is regulated.

Impact of the Arbitration Act 2025

Given the intended efficiencies to the arbitration process as a result of the 2025 Act, the result could be an increase in both international and domestic arbitrations seated in London.  Internationally, the aim is to promote London as a seat by providing additional certainty, as well as equipping tribunals with tools available in other jurisdictions.  On the domestic front, the impact could be a preference for arbitration over adjudication or litigation, particularly given the backlog in the court system.  This is particularly relevant given that the aim of the 2025 Act is to improve efficiency and provide finality with a limited ability to appeal decisions in the arbitration process.

Beale & Co has extensive experience in acting for clients in arbitrations both internationally and domestically, particularly in complex construction related disputes.  If you have a specific query related arbitration or a project in distress, please do not hesitate to get in contact with our construction disputes team.

David Nitek can be contacted on +44 (0)207 469 0430 or at David.Nitek@beale-law.com.

Nadir Hasan can be contacted on +44 (0) 20 7469 0438 or at N.Hasan@beale-law.com.

Priya Thakrar can be contacted on +44 (0) 20 7469 0432 or at P.Thakrar@beale-law.com.

Cameron Baker can be contacted on +44 (0) 20 3053 3066 or at Cameron Baker C.Baker@beale-law.com.