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There is more than one way to resolve a commercial dispute, and arbitration has long been among the most effective, particularly for parties who value privacy, want a say in who decides their case, or need an award that will hold up across international borders.
Our arbitration solicitors at Tower Bridge Legal act for businesses and individuals in Birmingham, London and further afield, handling everything from clause drafting through to hearings and the enforcement of awards.
What Is Arbitration?
Arbitration is a private process for settling disputes outside the court system, in which the parties appoint an independent arbitrator – or a panel of arbitrators – to hear the evidence, consider the legal arguments on each side and hand down a binding decision known as an award, which carries the same legal force as a court judgement.
The process is governed in England and Wales by the Arbitration Act 1996, now updated by the Arbitration Act 2025, and those two pieces of legislation together set the ground rules for how arbitrations are conducted, how arbitrators are appointed and removed, and on what limited basis an award can be challenged.
What distinguishes arbitration from mediation is the question of who decides the outcome.
A mediator facilitates discussion and helps the parties reach their own agreement, whereas an arbitrator weighs the evidence and makes a determination that both sides are bound to accept, with very little room for appeal once the award has been issued.
The Arbitration Act 2025: What Has Changed?
On 1 August 2025, the Arbitration Act 2025 came into force, marking the first substantial overhaul of England’s statutory arbitration framework since the mid-1990s. The new Act does not tear up the 1996 legislation but makes a series of targeted amendments aimed at tightening up areas where the law had become uncertain or where practice had moved ahead of the statute.
One of the headline changes concerns the law governing arbitration agreements – under the old regime, the governing law of the main contract would usually apply by default, but the 2025 Act replaces that with a clearer rule under which the law of the arbitration seat governs instead, removing a layer of uncertainty that had generated considerable satellite litigation.
The Act also places on a statutory footing the arbitrator’s duty of disclosure, now judged on an objective basis from the moment they are first approached to act. Tribunals have been given express powers to dispose of claims summarily where a party plainly has no real prospect of success, emergency arbitrators are formally recognised and their orders enforceable through the courts, and the court’s own supportive powers under section 44 have been broadened to reach third parties.
When Arbitration May Be the Right Choice
No two disputes are alike, and there is no single process that suits every situation, but arbitration tends to come into its own where particular factors are at play, and it is worth understanding what those are before deciding how to proceed.
Confidentiality – Because court proceedings are a matter of public record, any business with concerns about protecting commercially sensitive information or keeping a dispute away from the press may find the private nature of arbitration particularly attractive, since the hearing itself, the evidence relied upon and the final award all remain confidential unless both parties agree otherwise.
Specialist expertise – Unlike court litigation, where you take whichever judge is assigned, arbitration allows the parties to select an arbitrator with genuine technical knowledge of the sector in question – something that makes a real difference in industries like construction, shipping, financial services or technology, where the subject matter is often highly specialised.
International enforceability – Under the New York Convention, arbitration awards can be enforced in more than 170 countries, which makes arbitration a natural fit for cross-border commercial disputes where the parties or their assets sit in different jurisdictions and where enforcing a domestic court judgement abroad might otherwise be a complicated and uncertain exercise.
Procedural flexibility – The parties are free to agree on procedural rules that suit the particular dispute, choose where and in what language the hearing takes place, and set a timetable that works for everyone involved. This gives a degree of control over the process that you simply do not get in standard court proceedings.
Finality – Parliament has deliberately kept the grounds for challenging an arbitral award narrow, confining them to procedural irregularity, lack of jurisdiction or serious error of law, which means that once an award has been issued, the dispute is for all practical purposes at an end and the parties can move on.
Types of Disputes Suited to Arbitration
We regularly advise on arbitration across a wide range of commercial and civil disputes, including contractual disagreements, partnership and shareholder fallouts, construction and engineering claims, international trade and commodities, intellectual property licensing, professional negligence, property and landlord-tenant matters, and insurance and reinsurance disputes.
Where a contract already contains an arbitration clause, the parties may well be bound to resolve any disagreement through arbitration rather than the courts, which is why we always recommend having those clauses reviewed and properly drafted from the outset.
FAQs About Arbitration
What is the difference between arbitration and litigation?
Both produce a binding decision, but the process of getting there is quite different – litigation plays out in the public courts before a judge under the Civil Procedure Rules, whereas arbitration is a private process in which the parties themselves choose who will decide the dispute, agree the procedural timetable and have considerably more control over how the case is run. Each route has genuine strengths, and the right one depends on what matters most to the parties in any given situation.
Is an arbitration award legally binding?
It is, and it carries exactly the same weight as a court judgement – under the Arbitration Act 1996 (as amended by the 2025 Act), a party who has obtained an award can apply to the court to have it enforced if the other side fails to comply, and internationally, awards are recognised and enforceable in over 170 countries through the New York Convention framework.
Can I be forced to go to arbitration?
If you have signed a contract containing a valid arbitration clause, you may well be contractually obliged to take any dispute arising under that agreement to arbitration rather than the courts, which is precisely why it pays to have arbitration clauses reviewed carefully before you sign. Our solicitors can walk you through the implications and advise on what the clause actually commits you to.
How long does arbitration take?
That depends on the complexity of the dispute, the number of parties involved and what procedural rules have been agreed, but a reasonably straightforward commercial arbitration can often be wrapped up within a few weeks or months, whereas cases involving multiple parties, heavy disclosure or detailed expert evidence will naturally take longer. One of the practical advantages of the process is that the parties can fix a timetable between them rather than waiting for a court date.
How much does arbitration cost?
There is no fixed answer because costs will vary according to the value and complexity of the dispute, the number of arbitrators sitting, and whether the arbitration is run under institutional rules or on an ad hoc basis. Arbitrator fees, hearing room costs and legal representation all feed into the final figure, and we make a point of giving clients clear, realistic costs advice right at the start so that you can weigh up whether arbitration is the right path before committing to it.
How Tower Bridge Legal Can Help
Our dispute resolution team handles arbitration from start to finish. This includes, drafting and reviewing arbitration agreements, advising on the choice of rules, assisting with the appointment of arbitrators, preparing evidence and submissions, and representing clients at hearings, whether they are bringing a claim or defending one.
Choosing how to resolve a dispute is as much a commercial decision as a legal one, and we are upfront about that from the outset. We will assess the merits of your position candidly, give you a realistic picture of likely costs, and if we think a different route would serve you better, whether that is mediation, negotiation or court proceedings, we will say so.
We also advise on enforcing arbitral awards in England and abroad, and can act quickly if the other side refuses to comply, or equally to challenge an award on your behalf where there are proper grounds to do so.
Contact Us
If you are dealing with a commercial dispute or need advice on an arbitration clause in a contract, our solicitors are ready to help. Contact Tower Bridge Legal for a confidential initial consultation, and we will give you a frank assessment of where you stand and what your options look like.