The English Arbitration Act 2025 introduces a notable shift in the legal scaffolding that supports arbitration in England: the Act expressly extends the courts’ powers to support arbitral proceedings to include third parties. That clarification, applied only to proceedings arising after the Act’s effective date, has immediate practical implications for commercial contracting, insurance disputes and cross-border dispute resolution practice.

For practitioners and contracting parties, the most urgent task is a careful review of existing arbitration clauses that incorporate English law or a choice of English arbitration rules. The Act reinforces the importance of an express choice of law governing the arbitration agreement itself, not merely the underlying contract. That distinction can determine whether a party can challenge an arbitral tribunal’s jurisdiction in court, and the circumstances in which those challenges may be lost or curtailed.

One consequence is procedural. The Act’s provisions make it more likely that legal issues — such as the formation and validity of the arbitration agreement or questions of third-party involvement — will be amenable to summary disposition. Summary procedures can compress timelines and reduce litigation spend by narrowing disputes to points of law or disposing of them without full evidentiary hearings. For industries with frequent, high-volume claims such as insurance, the potential to resolve threshold legal issues quickly may materially lower transaction costs and free capital otherwise held against dispute risk.

Market participants should also weigh the commercial implications. Insurers dealing with coverage disputes and reinsurance arrangements often face complex multi-party arbitrations where third-party rights and obligations intersect. By clarifying court support for third parties, the 2025 Act reduces legal uncertainty about interim relief, disclosure and enforcement in those contexts. That may influence where parties choose to seat arbitrations and how they draft jurisdiction and severability clauses, potentially reinforcing London’s competitiveness as an arbitration forum for disputes involving third-party interests.

From a policy perspective, the Act represents a continuity of a broader trend toward judicial facilitation of arbitration rather than court withdrawal. By delineating the scope of court support for third parties, lawmakers sought to balance the autonomy of arbitration with necessary judicial oversight — enabling courts to provide interim measures while preserving arbitral finality where appropriate. That balance will be tested as courts apply the new provisions to cross-border disputes and to matters of public policy, such as insolvency or consumer protection where third-party rights may be implicated.

In the long term, the change could encourage greater use of arbitration in multi-party commercial arrangements and complex financial contracts by reducing perceived legal gaps. But it will also shift the skill set demanded of in-house counsel and outside advisers: more attention to clause drafting, tighter preservation of jurisdictional challenges, and strategic use of summary procedures. With the Act’s prospective application, the immediate priority for contracting parties is routine but consequential — revisit arbitration clauses now to ensure the intended allocation of risk and the intended procedural pathways remain intact under the new legal framework.