Reed Smith In-depth

In September 2022, the Law Commission of England and Wales launched a consultation to review whether the legislative framework governing arbitration in England and Wales – the Arbitration Act 1996 – should be amended. In this article, we review some of the key areas under discussion and in relation to which recommendations for legislative change may be on the horizon later this year.


Parties to a smooth-running international arbitration may perceive the process as entirely independent from the national laws of the seat.

In fact, arbitration works so well because it is supported by a framework of national laws. These laws ensure that parties abide by their arbitration agreement and provide the broad rules of process and conduct. When things go wrong, the appropriate national court can then step in to support the tribunal.

Arbitrations seated in London are subject to the Arbitration Act 1996 (the Act), which applies to arbitrations taking place within England and Wales (Scotland and Northern Ireland are separate jurisdictions).1

The Act was introduced to harmonise existing English arbitration legislation into a single source. It also sought to align English arbitration law, where appropriate, with the UNCITRAL Model Law on International Commercial Arbitration (Model Law), which forms the basis of the arbitration rules in 118 jurisdictions. However, the Act does differ from the Model Law in key respects. This, combined with London’s importance as an arbitral centre, renders the Act a unique and influential part of the international arbitration legal framework.

The English legal establishment is pro-active in reinforcing the preeminent status of English law in the commercial world, with London as a leading dispute resolution forum.

The Law Commission of England and Wales (the Commission) is an independent body which reviews and updates English law when required. Changes in the international arbitration market have called into question whether, despite its success over the past 25 years, certain aspects of the Act could benefit from reform.

Reflecting the pro-active stance of the English dispute resolution community, the Commission reviewed the Act and subsequently launched a consultation in September 2022. The consultation set out the Commission’s proposals as to whether the Act should be updated. The consultation process closed in December 2022, and the Commission’s final proposals, taking into account responses received from various stakeholders during the consultation, are expected in the middle of 2023.

We highlight the Commission’s key proposals below.2


Confidentiality is a key attraction for those choosing international arbitration to resolve their disputes. The Act currently contains no express duty of confidentiality. Instead, the principle of party confidentiality in English-seated international arbitration is derived from case law. This finds the relevant obligation in a combination of express agreement, adoption of institutional rules, or implied contract terms. Many have questioned whether an express duty of confidentiality in the Act would assist users by providing clarity on the point.

The conclusion of the Commission is that a “one-size-fits-all” approach will not work. A key issue is developing and codifying exceptions to the rule within a statute. The courts have thus far found it difficult, within the relatively flexible forum of case law, to identify the appropriate exceptions to confidentiality. Statutory law is more rigid. As a result, the Commission proposes that the English courts continue to develop confidentiality principles through case law and apply them in the context of the specific facts of each case.