China’s Arbitration Law, enacted in 1995, provided the foundation for the country’s modern arbitration regime but has long been seen as outdated in several respects, particularly in comparison with international practice. After years of incremental judicial interpretations and regional pilot projects, the NPC Standing Committee has now passed a sweeping amendment designed to modernise the framework and make Chinese arbitration more attractive in the global dispute resolution market.
The revised law makes significant strides in recognising international arbitration norms. It broadens the definition of foreign-related arbitration (Article 78) and, for the first time, formally introduces the concept of an arbitration “seat” (Article 81). The nationality of an arbitral award will henceforth be determined by the seat of arbitration—a key principle in international arbitration practice.
Another landmark reform is the limited acceptance of ad hoc arbitration. Under Article 82, ad hoc arbitration is permitted in foreign-related maritime disputes and for disputes between enterprises registered in pilot free trade zones (“<span class="news-text_medium">FTZs</span>”), the Hainan free trade port (“<span class="news-text_medium">FTP</span>”) and other designated areas. Additionally, Article 86 authorises foreign arbitration institutions to establish offices within FTZs and the Hainan FTP and to administer foreign-related cases, reinforcing China’s ambition to make these regions international arbitration hubs.
The amendments introduce a range of procedural modernisations. Arbitration proceedings may now be conducted online by default, unless either party objects (Article 11). The law strengthens pre-arbitration preservation, explicitly allowing parties to apply to people’s courts for urgent preservation of property, evidence, or conduct before arbitration begins (Articles 39 and 58).
Tribunals are also empowered to seek assistance from administrative bodies to collect evidence (Article 55), addressing practical challenges in evidence-gathering that previously undermined efficiency. Together, these provisions aim to enhance both accessibility and effectiveness of arbitration in China.
Several provisions address persistent uncertainties around arbitration agreements. Article 30 clarifies that an arbitration agreement remains valid regardless of whether the underlying contract has been established, amended, terminated, revoked, or deemed void. Under Article 31, arbitral tribunals are expressly authorised to rule on the validity of arbitration agreements upon party application, while courts retain limited supervisory jurisdiction.
The law codifies judicial interpretations by stipulating that if one party alleges the existence of an arbitration agreement and the other does not object before the first hearing, the agreement will be deemed valid once the tribunal reminds the parties and records the acknowledgment (Article 27). This codification is designed to reduce procedural delays caused by challenges to the existence of arbitration clauses.
Beyond these headline changes, the amendment introduces a series of practical adjustments:
The 2025 amendment represents a decisive step in the evolution of China’s arbitration framework. By addressing long-standing criticisms, particularly in relation to foreign-related arbitration, ad hoc proceedings and procedural flexibility, the reform strengthens China’s position as an arbitration venue. While questions remain regarding implementation and judicial support, especially for ad hoc arbitration, the changes bring the system closer to international standards and signal China’s determination to become a leading jurisdiction in global dispute resolution.
