England & Wales’ Law Commission Publishes Consultation Paper on the Arbitration Act 1996

Faegre Drinker Biddle & Reath LLP

The Arbitration Act 1996 came into force on 31 January 1997. Twenty-five years later it is still the gold-standard legal framework for arbitration.

On 22 September 2022, the Law Commission of England and Wales published its much anticipated “Review of the Arbitration Act 1996: A consultation paper”. The review seeks to ensure that the Act remains “state of the art” for domestic and international arbitration. It is thoughtful and wide-ranging — from considering major reforms to underlying principles of the Act, to minor tweaks that reflect how modern arbitration is conducted today (often remotely, and increasingly with a desire to reduce the carbon footprint of international arbitrations).

In particular, four proposals strike us as interesting features:

  • First, in a “world-leading initiative … send[ing] an important signal about diversity and equality”: an offer to tackle discrimination in arbitral appointments by adopting the language of the English Equality Act 2010 so that arbitral appointments cannot be challenged for reasons that are discriminatory.
  • Second, driving for efficiency: the Commission provisionally recommends a nonmandatory provision giving arbitrators the power to adopt a summary procedure to decide issues that have no real prospect of success and no other compelling reason to continue to a full hearing (borrowing its thresholds from the English Civil Procedure Rules).
  • Third: the Law Commission’s suggestion to codify that arbitrators have a continuing duty to disclose any circumstances which might reasonably give rise to justifiable doubts as to their impartiality (following the Supreme Court of the United Kingdom’s decision in Halliburton Co v Chubb Bermuda Insurance Ltd [2020] UKSC 48).
  • Finally, on the thorny topic of challenges to jurisdiction: a proposal that any challenge under section 67 of the Act should be by way of an appeal (where the court reviews the decision of the tribunal) and not a total rehearing.

If any of those proposals are adopted, they will go some way to cementing the U.K.’s position as a global hub for international arbitration for another twenty-five years.

The consultation concludes on 15 December 2022.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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