Lawyers have welcomed what has been called the ‘fine-tuning’ of arbitration rules as proposed by the Law Commission today.
The commission unveiled proposals to update the Arbitration Act 1996 but concluded it still functions well and that its central provisions should remain unchanged.
Suggested improvements include measures to improve the efficiency of cases, give further protections to arbitrators, grant extra provisions to the courts to support cases and refine the process for challenging an arbitrator and their decisions.
Current provisions on confidentiality and impartiality, it is proposed, should remain unchanged as they work effectively.
Professor Sarah Green, the law commissioner for commercial and common law, said: ‘The Arbitration Act was a landmark piece of legislation which helped to propel London to its position as the foremost destination for international arbitration today.
‘While it continues to function well, over 25 years later, some parts of the act may benefit from being updated and refined.
‘Our proposals are designed to ensure that arbitration law is efficient, effective and responsive to modern developments. By making further improvements, we can help the UK to consolidate its status as a global centre for international dispute resolution.’
Proposals are likely to be looked at favourably by the government. Justice minister Lord Bellamy KC said today it was right to look at the legislation ‘to ensure [it] remains relevant in the 21st century’.
Lawyers said today they were pleased that reform of the existing act was on the table rather than more sweeping changes.
Craig Tevendale, partner and head of international arbitration at Herbert Smith Freehills, said: ‘On an initial view, the consultation paper proposes some very welcome changes, but the approach is based upon fine-tuning rather than root and branch reform.
‘Notably, the Commission has not proposed to codify the law of confidentiality or to change the approach under Section 69 of the Act (appeals on a point of law). However, there appears to be some innovative rethinking of Section 44 of the Act on interim relief.’
Speaking on behalf of London International Disputes Week, Ben Giaretta said: ‘There have inevitably been developments in international arbitration over the past quarter of a century, such as the creation of emergency arbitration, and the Law Commission’s paper makes very sensible proposals about how the law can evolve to address these.
‘Changes to the duties of arbitrators to make disclosures of potential conflicts of interest, and amendments relating to the use of technology in arbitration, would be beneficial in ensuring London retains its leading position internationally, and continues to adapt to a changing world.’
The Law Society welcomed proposals to amend the Arbitration Act. Society president I. Stephanie Boyce said: ‘It enabled the growth and standing of our jurisdiction as an international destination for arbitration.
‘However, the world is not standing still and it is important to review and update the provisions of the Act some 25 years after it was adopted.’
- Allow arbitrators summarily to dismiss claims, made by parties, that lack legal merit.
- Retain current duties on the impartiality of arbitrators, with an additional provision on disclosing conflicts of interest, so that such disclosure is fully codified in the Act.
- Further protection for arbitrators: strengthening their immunity in certain cases and introducing provisions in support of equality in arbitral appointments.
- Extend the capacity of the courts to support arbitration proceedings.
- Refine the process for challenging the jurisdiction of an arbitrator, so that challenges in the courts take place by way of an appeal, rather than a full rehearing.
- Retain current provisions around confidentiality and privacy in arbitration proceedings.
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