Arbitration Bill introduced to Parliament

11 December 2023

As trailed in the recent King’s Speech, the Arbitration Bill was introduced to Parliament on 21 November 2023.

This follows the Law Commission’s review of the Arbitration Act 1996 (the Act) and the publication of its final report in September. The Government has accepted the Law Commission’s recommendations in full and the contents of the Bill will come as little surprise to those who have been following the Law Commission’s consultation process (see our previous articles: A "state of the art" Arbitration Act: the Law Commission's proposals and Second consultation paper on reform of the Arbitration Act 1996).

Assuming the Bill is passed without major amendments, the main reforms will be as follows.

Statutory duty of disclosure

A statutory duty of disclosure will be imposed on arbitrators. The requirement will be for arbitrators to disclose circumstances, which “might reasonably give rise to justifiable doubts as to the individual’s impartiality in relation to the proceedings, or potential proceedings, concerned”.

Insofar as this requires arbitrators to disclose circumstances of which they are actually aware, this is a codification of the common law rules found in Halliburton v Chubb [2020] UKSC 48. However, the proposed amendment also requires arbitrators to disclose circumstances of which they “ought reasonably” to be aware. This goes further than Halliburton v Chubb (where the point was considered but not decided). The question of what an arbitrator ought reasonably to be aware of will vary from case to case and the Law Commission suggests that it will not always be necessary for arbitrators actively to investigate whether there are circumstances that should be disclosed. However, professional arbitrators in large commercial arbitrations would be well advised to make such enquiries in order to ensure that they have complied with their duty to disclose.

Recognising that a “one-size-fits-all” approach is not appropriate, the Law Commission did not recommend that the Act should prescribe what should be disclosed, which will vary from case to case. For example, in many cases arbitrators will be required to disclose overlapping appointments but in some sectors (for example, maritime, sports, commodity, and reinsurance) established custom and practice may mean that overlapping appointments do not need to be disclosed.

Arbitrator immunity

The Bill provides that arbitrators will not be liable for: (i) costs incurred in applications for their removal, unless the arbitrator acted in bad faith; and (ii) losses suffered as a result of their resignation, unless the resignation was unreasonable. These changes will bolster the existing rules on arbitrator immunity in section 29 of the Act. In particular, they will free arbitrators from concerns about personal liability in situations where it is appropriate for them to resign and where parties threaten removal applications as a means of exerting pressure.

Summary disposal

Arbitrators will be given an express power to make an award on a summary basis.

Whilst it is reasonably clear that arbitrators’ existing powers under the Act are sufficiently broad to allow for summary disposal, there is a view that these powers have been underutilised. One explanation for this is that arbitrators are sometimes concerned that awards made on a summary basis may be challenged, or enforcement may be resisted, on grounds that a party was deprived of a reasonable opportunity to put their case. The purpose of the reform, therefore, is to alleviate these concerns and to encourage the use of summary procedures in suitable cases, thereby increasing efficiency and reducing the scope for parties to adopt tactics of delay.

The test will be whether the relevant party has a “real prospect of succeeding” on the claim, issue or defence that is the target of the summary disposal application. This has the advantage of familiarity in that it is the test used by the English courts. The rule will be non-mandatory, meaning that parties can either opt out of it completely or specify an alternative test.

Court powers in support of arbitration

Section 44 of the Act sets out the powers that a court can exercise in support of arbitral proceedings, for example, to preserve evidence or grant an interim injunction. The Bill amends section 44 to clarify that such orders can be made against non-parties. This is necessary because the case law has produced a degree of uncertainty and inconsistency on this point. The effect of the amendment will be to import the rules and case law on equivalent orders against non-parties in civil litigation. This means that, where section 44 provides for a type of order to be made, that order will be available against persons, who are not parties to the relevant arbitration, to the extent that an equivalent order would be available in support of litigation.

There is a further amendment giving full rights of appeal to non-parties, against whom an order has been made under section 44. Under the current rules, an appeal (whether by a party or non-party to the arbitration) can only be made with the permission of the court that granted the order. This restriction will be removed for non-parties, although the current rules will continue to apply to parties to the arbitration.

Emergency arbitrators

The practice of appointing emergency arbitrators on an interim basis pending appointment of a full tribunal is a relatively recent innovation and is not covered by the Act, which is over 25 years old. Having consulted on the issues, the Law Commission decided against either amending the Act to include a scheme for the appointment of emergency arbitrators or extending the application of the Act to emergency arbitrators generally. This was broadly on the basis that arbitral institutions are better equipped to manage the process of appointing emergency arbitrators and the orders of emergency arbitrators can be policed by the full tribunal, once it is appointed.

However, the Bill contains more targeted proposals to support the enforcement of orders made by emergency arbitrators. First, the Bill provides that emergency arbitrators may make a peremptory order, which may be enforced by the court. Second, emergency arbitrators will be given the power to give parties permission to apply to the court for an order under section 44(4) of the Act. Both these changes replicate the rules already in place for “normal” arbitrators. This means that, where a party ignores an order made by an emergency arbitrator, either of these two pathways can be used to enlist the powers of the court to enforce that order.

Challenging jurisdiction

One of the issues that caused most debate during the consultation process was the question of whether the rules (in section 67 of the Act) on challenging a tribunal’s jurisdiction to make an award should be reformed. The current position is that any challenge under section 67 takes place by way of full rehearing, even where a full hearing has been held before the tribunal. In its first consultation paper, the Law Commission expressed the view that the current approach adds delay and expense and causes procedural unfairness in that it gives a party challenging jurisdiction “two bites of the cherry”. It therefore provisionally proposed that the Act should be amended to provide that any challenge under section 67 should be by way of review of the tribunal’s decision rather than a full rehearing (where the party challenging jurisdiction has participated in the arbitral proceedings).

Although the majority of consultees supported this approach, there were also strong objections principally on the ground that parties who have not consented to the jurisdiction of an arbitral tribunal should be entitled to a full hearing before the court. Or, to put it another way, if the tribunal has no jurisdiction, then its ruling on jurisdiction should have no weight and no deference should be given to it.

The Law Commission’s compromise solution is that procedural rules should be implemented to provide that an applicant making a section 67 challenge cannot raise new grounds of objection to the tribunal’s jurisdiction, or adduce new evidence, unless the applicant can show that it was not possible with reasonable diligence to put the objection or evidence before the tribunal. Another rule would provide that evidence that was heard by the tribunal must not be re-heard by the court, unless the court considers it “necessary in the interests of justice”. These rules would only apply where the applicant took part in the arbitral proceedings and the tribunal has ruled on its own jurisdiction.

The proposed mechanism for implementing these changes is an amendment to the Act empowering the Civil Procedure Rules Committee to make procedural rules along the lines outlined above. Ultimately, therefore, it will be for the Rules Committee to decide whether to make these changes and, if so, whether they should first be the subject of a pilot.

Amongst other more minor changes to section 67, the Bill also contains an amendment clarifying that the tribunal has the power to award costs in situations where there has been a finding (by the tribunal or the court) that the tribunal lacks substantive jurisdiction. This provides welcome confirmation that a party who has successfully challenged jurisdiction can in principle recover their costs.

The governing law of the arbitration agreement

The Bill inserts a new section 6A in the Act, which provides that an arbitration agreement will be governed by the law of the seat, unless the parties expressly agree otherwise.

The effect is to overturn parts of the decision in Enka Insaat Ve Sanayi AS v. OOO Insurance Company Chubb [2020] UKSC 38 in which the Supreme Court held (amongst other things) that, where the parties have (expressly or impliedly) chosen the law to govern the main contract, this will be an implied choice of law to govern the arbitration agreement (subject to certain exceptions).

This amendment will ensure that (unless the parties agree otherwise) English law, with its supportive approach to arbitration will apply in English seated arbitrations. In particular, it means that English rules on arbitrability, the scope of an arbitration agreement and separability will apply. Furthermore, the proposed test is simpler and easier to apply than the one in Enka v Chubb, meaning that there will be reduced scope for satellite disputes.

Issues not covered by the Bill

It is also worthy briefly considering some of the areas where the Law Commission decided against proposing reform.


The Law Commission took the view that it would not be possible for any single statutory rule to cater for all the situations in which questions of confidentiality can arise or to delineate the limits of, and exceptions to, the general rule that arbitration is a confidential process. In their view, the better approach is for the rules in this area to be developed by the courts, which can respond on a more pragmatic and flexible basis.


The Law Commission also “reluctantly” decided that it would not be possible to incorporate a workable prohibition on discrimination in the Act. Difficulties in policing such a rule and in providing adequate remedies for breaches of it, as well as concerns that it could provoke unwarranted satellite litigation and challenges to arbitral awards, were amongst the reasons given in the final report for the conclusion that there are better and more effective ways of promoting diversity in arbitration.

Appeal on a point of law

The Law Commission recommended that there should be no reform to s.69 of the Act (appeal on a point of law). In their view, the current rules strike a suitable balance between promoting the finality of arbitral awards and the desirability of ensuring that obvious errors on important points of law can be corrected. Parties who do not wish there to be an appeal on a point of law can opt out of section 69.

Gerald Metals v Timis

The Law Commission had originally asked consultees to consider whether section 44(5) of the Act should be repealed. Section 44(5) provides that the court should only intervene to the extent that the tribunal, the relevant institution or others vested with power to act, are unable to act effectively. Part of the reason for this proposal was to respond to the High Court decision in Gerald Metals SA v Timis [2016] EWHC 2327 (Ch). That case has been interpreted by some as meaning that section 44(5) precludes an arbitral party from ever applying to court under section 44 where emergency arbitrator provisions are available.

As the Law Commission explained in its first consultation paper, those concerns are misconceived and Gerald Metals should not be taken to mean that a party cannot apply to court where an emergency arbitrator cannot act effectively (for example, because the timescale for the appointment of an emergency arbitrator might be too slow; or the arbitral party needs an order which binds third parties).

However, having received feedback from consultees, the Law Commission decided not to pursue this proposal. This was primarily because section 44(5) contains an important “statement of principle that court intervention in arbitral proceedings should be less rather than more”. Nonetheless, this public discussion/consultation of the impact of emergency arbitrator provisions on parties’ ability to apply to court has been valuable. It is to be hoped that misconceptions about the effect of Gerald Metals can now be put to rest.


Throughout the consultation process, the Law Commission and consultees have been clear that the Act has worked well. The purpose of the Bill has been described as being to modernise the Act, rather than to produce root and branch reform. Indeed, in the docket for the King’s Speech the reform was characterised as merely a “tidying-up exercise”. Nonetheless the proposed changes are important because they reflect developments in arbitration practice and procedure since the Act came into force in January 1997 and because they resolve a number of issues that have arisen out of the case law in the intervening period.

A notable feature of the consultation process has been the way in which the Law Commission has engaged with the arbitration community and responded to suggestions made by it (for example by incorporating the proposal that the rules on the governing law of an arbitration agreement should be changed, which was not included in the first consultation paper). Another important theme of the consultation process has been that national legislation should be supportive, but not overly prescriptive, and that party choice is paramount. Furthermore, the Law Commission recognises that a “one-size-fits-all” approach is often not appropriate and that in some respects it is better for the law to be developed on a case-by-case basis through the courts. The overall result is a set of reforms which ensures that the law is up to date but which continues to reflect the needs of the arbitration community for pragmatism and flexibility.