Revised PRC Arbitration Law Introduces Major Reforms

Long-awaited revisions to China’s Arbitration Law have been published, which include modernisation of China’s arbitration regime and the explicit adoption of concepts and procedures which will be familiar to the international arbitration community.

These changes to China’s arbitration law align the PRC’s regime more closely with standard international arbitration practice, making China a more attractive, and accessible, seat of arbitration; a development which may have a significant impact on arbitration in China and beyond.

Background

The Arbitration Law of the People’s Republic of China (Arbitration Law) was first adopted on 31 August 1994. Although the Arbitration Law was amended in 2009 and 2017, reform of China’s arbitration regime was, according to some commentators, long overdue. Various draft amendments had been proposed over the years which also caused uncertainty as to the future of arbitration in China, as did questions over whether China would adopt the UNCITRAL Model Law.

China’s Revised Arbitration Law

On 12 September 2025, the Arbitration Law of the People’s Republic of China (2025 Revision) (Revised Law) was adopted.¹ The Revised Law has 8 chapters, containing a total of 96 articles, and comes into effect on 1 March 2026.² In this article we explore aspects of the Revised Law, which will be of interest to the global international arbitration community and to parties who engage in arbitration in China.

Online Arbitration

Arbitration in China has taken place online for many years, the China International Economic and Trade Arbitration Commission (CIETAC) arbitral rules regulated online arbitration as far back as 2009. Online arbitration proved popular in China and in 2024 CIETAC administered 1,766 remote hearings.³ The Revised Law continues this theme and expressly permits online arbitration (unless the parties disagree), and online arbitration activities have the same legal effect as in person arbitrations.⁴

The use of information technology (e.g. service by email) and remote hearings during arbitral proceedings have many benefits, including reducing costs, delay, and the carbon footprint. This aspect of the Revised Law will therefore be welcomed by the global arbitration community and by parties alike.

Arbitration Agreements: Deemed Existence

Article 27 of the Revised Law deals with the terms of arbitration agreements and states that if one party asserts that an arbitration agreement exists when applying for arbitration, the other party must deny that the agreement exists before the first hearing, or the arbitration agreement will be deemed to exist.⁵

Early disposal of disputes over the existence of an arbitration agreement will enable claimants to proceed with their claims more efficiently, particularly where there is no written arbitration agreement, and will avoid arguments being used by respondents to delay the inevitable and/or exhaust the claimant’s funding.

On the other hand, respondents will need to bear this provision in mind and clearly set out their position – at an early stage – if they intend to argue that the arbitration agreement relied upon by the claimant does not exist and / or was not entered into by the parties.

Arbitration Agreements: Separability and ‘Kompetenz-Kompetenz’

The Revised Law confirms that the validity of an agreement in which the parties agreed to arbitrate disputes arising out of a specific contract is not affected by the effectiveness, modification, invalidity, or revocation of that contract.⁶ The Arbitration Law (2017 Revision) included a similar provision, on which the Revised Law has expanded.

Arbitration tribunals will be empowered by the Revised Law to confirm the validity of such arbitration agreements, and the Revised Law sets out the process whereby parties can request a decision from the tribunal – or a ruling from the People’s Court.⁷ This party-led approach is pragmatic, commercial and will be familiar to the international arbitration community, given that it is in line with the position elsewhere.

The 2021 State Council Public Consultation Draft (Draft) featured broader drafting, which embraced the concept of Kompetenz-Kompetenz more fully. Under Article 28 of the Draft, questions regarding the existence, validity, and effectiveness of the arbitration agreement, as well as the arbitration panel’s jurisdiction to hear the dispute would have been decided by the arbitral tribunal, whereas the Revised Law takes a more conservative stance.

Preservation Measures

The Revised Law introduces interim measures for the first time for the preservation of assets and evidence and / or to restrain certain conduct via, for example,  injunctive relief and are available before parties commence arbitration.⁹ This is another new feature of the Revised Law, aligning itself with the availability of similar principles in PRC court proceedings, under the Civil Procedure Law of the People’s Republic of China.¹⁰

Emergency relief is also available, upon application by parties to the People’s Court.¹¹

In addition, arbitral tribunals are now empowered to collect their own evidence and request assistance with collection of evidence from relevant authorities.¹²

Service of Arbitration Documents

There has been discussion around the frequency with which PRC courts agree to set aside or refuse to enforce arbitral awards due to defects in the service of arbitration documents.¹³

The Revised Law states that:

“An arbitration document shall be served in a reasonable manner agreed upon by the parties; if the parties have no such agreement or the agreement is unclear, the arbitration document shall be served in the manner prescribed by the rules of arbitration.”¹⁴

The Revised Law therefore supports service of proceedings.

Arbitral Institutions update their rules to remain an Institution of choice, so their service rules tend to keep up with developments in modern technology, which is another benefit to aligning service provisions to those of the relevant Institution.

Setting Aside Awards: Time Limits

Under the Revised Law, parties will only have three months from the date of receipt of the arbitration award to file set aside applications,¹⁵ rather than the six months allowed under the current regime.

This is a significant reduction, and one which parties and lawyers alike should bear in mind, lest they miss the opportunity to set aside an unfavourable award. On the other hand, this reform will result in disputes being disposed of swiftly, providing certainty and finality, and will be welcomed on that basis.

Foreign-Related Disputes: Expanded Scope of ‘Foreign-Related Disputes

Currently, China’s arbitration regime defines ‘foreign-related disputes’ as the “arbitration of disputes arising from economic, trade, transportation and maritime activities involving a foreign element“.¹⁶

The Revised Law extends this definition to include “and other foreign-related disputes“,¹⁷ which significantly widens the range of ‘foreign-related disputes’ which can take advantage of provisions which aim to facilitate the arbitration of international disputes in China.¹⁸

Foreign-Related Disputes: Seat of Arbitration

The Revised Law empowers parties who are arbitrating a foreign-related dispute to choose the seat of arbitration.¹⁹ This provision also clarifies that the seat of arbitration dictates the law applicable to the arbitration proceedings and the court which has jurisdiction to hear any disputes arising from it (e.g. set aside or enforcement applications), which further aligns it with international regimes. Significantly, this provision expressly adds the concept of “seat of arbitration” to Chinese arbitration law, which is welcome clarification.

Foreign-Related Disputes: Recognition & Enforcement

The Revised Law permits recognition and enforcement of arbitral awards made outside Mainland China.²⁰ Rules setting out how jurisdiction is established are based on concepts which will be familiar to the international arbitration community, such as the domicile of the award debtor, location of assets, and “an appropriate connection” to the matters in dispute and the Revised Law explicitly requires Chinese courts to act in accordance with international treaties to which China is a party “or on the principle of reciprocity“.

Foreign-Related Disputes: Ad Hoc Arbitration in Foreign-Related Disputes

The Revised Law will permit entities formed and registered in designated locations to engage in ad hoc arbitration of foreign-related disputes.²¹

Ad hoc arbitration is not formally recognised under China’s current arbitration regime, albeit pilot schemes were trialled in certain areas (e.g. free trade zones).²² This development, which respects party autonomy and provides enhanced flexibility and efficiency, will be welcomed by the international arbitration community and parties alike.

Opening Up: International Ambitions

The Revised Law encourages Chinese arbitration Institutions to open offices in foreign jurisdictions and allows foreign arbitration Institutions to open in certain designated areas in China (e.g. free trade pilot zones), on the proviso that foreign institutes “carry out foreign-related arbitration activities in accordance with the relevant provisions issued by the state“.²³

Comments

The Revised Law represents a major development in China’s arbitration law, modernising the regime, respecting parties’ autonomy and incorporating concepts which are familiar to the international arbitration community.

This will foster trust in the Chinese arbitral regime and make arbitration in China more attractive, especially to foreign parties.

It is clear that the PRC aspires to continue to develop a reputation as a respected arbitration seat of choice for international disputes, building on its experience as a centre for domestic arbitration.

As is the norm in China, legislative amendments will be followed by judicial interpretation and further guidance, which may negate previous guidance. Therefore, this new legislation is likely the first step in the continued reform of China’s arbitral regime. We will monitor developments closely and provide further updates and analysis in due course.

Cotrina Fung, Trainee Solicitor, assisted with the preparation of this briefing.

Footnotes:

1. You can access the official Chinese version of the Revised Law here.
2. Revised Law, Article 96.
3. CIETAC 2024 Work Report and 2025 Work Plan, published by CIETAC (accessed 17 September 2025).
4. Revised Law, Article 11.
5. Revised Law, Article 27.
6. Revised Law, Article 30.
7. Revised Law, Article 31.
8. 中华人民共和国仲裁法（修订）（征求意见稿）, published by the Ministry of Justice of the People’s Republic of China on30 July 2021 (accessed 19 September 2025).
9. Revised Law, Article 39, Article 58.
10. Revised Law, Article 39, Article 82.
11. Revised Law, Articles 39, 58.
12. Revised Law, Article 55.
13. 新修订的《仲裁法》对实务的重要影响, published by Zhihu on 16 September 2025 (assessed 17 September 2025).
14. Revised Law, Art 41.
15. Revised Law, Article 72.
16. Arbitration Law of the People’s Republic of China (2017) Article 65.
17. Revised Law, Article 78.
18. Chapter VII of the Revised Law ‘Special Provisions for Arbitration Involving Foreign Elements‘ deals with, for example, preservation of evidence, seat of arbitration, set aside and recognition and enforcement of arbitral awards.
19. Revised Law, Article 81.
20. Revised Law, Article 88.
21. Revised Law, Article 82.
22. See Development and practice of ad hoc arbitration in mainland China, published by Global Arbitration Review on 15 May 2025 (accessed 19 September 2025).
23. Revised Law, Article 86.