China’s Newly Revised Arbitration Law to Come into Effect on 1 March 2026
Published 15 September 2025
Yu Du
On 12 September 2025, the 17th Meeting of the Standing Committee of the 14th National People’s Congress [ http://www.npc.gov.cn/npc/ ] voted to adopt the newly revised PRC Arbitration Law. According to the decision, the revised law will officially come into effect on 1 March 2026.
China’s Arbitration Law was first enacted in 1994, and since its adoption, the law had only undergone one limited revision in 2017. The 2026 revision is the first full-scale overhaul in over 30 years, aiming to modernize China’s arbitration regime and align it more closely with international norms.
The following sections highlight the major changes and institutional innovations introduced in the revised Arbitration Law compared to the previous version.
Online Arbitration Proceedings and Legal Recognition
The revised Arbitration Law explicitly allows arbitration proceedings to be conducted via online platforms, provided that the parties have not expressly objected. According to Article 11 of the revised law, “With the consent of the parties, arbitration activities may be conducted online via an information network platform. Online arbitration activities have the same legal effect as those conducted offline.”
This legislative change reflects China’s response to the increasing digitization of legal services, especially in light of global trends toward online dispute resolution (ODR). It institutionalizes the practice that emerged during the COVID-19 pandemic and allows parties from different jurisdictions to arbitrate efficiently without being physically present.
Openness to Cross-Border Arbitration Activities
The revised law significantly liberalizes the cross-border operation of arbitration institutions. Under Article 86, Chinese arbitration commissions are permitted to establish business institutions outside the territory of China. Conversely, Article 86 (paragraph 2) allows foreign arbitration institutions to establish offices within certain areas in China, such as free trade zones or the Hainan Free Trade Port, with approval from the State Council, to conduct foreign-related arbitration activities in accordance with national regulations.
Strengthening the Legal Framework for Foreign-Related Arbitration
A dedicated chapter (Chapter VII) of the revised law addresses foreign-related arbitration. Article 81 allows parties to agree in writing on the place of arbitration, which will determine the applicable procedural law and the competent court for judicial supervision. In the absence of such an agreement, the arbitration seat shall be determined based on the arbitration rules or by the tribunal according to the principle of convenience.
The law also introduces flexible mechanisms for conducting ad hoc arbitration in China under certain circumstances. Article 82 stipulates that in disputes arising between entities registered in the Free Trade Zones or Hainan Free Trade Port, parties may choose arbitration in China by either institutional arbitration or an ad hoc tribunal composed of qualified personnel, subject to filing with the arbitration association.
Further, Articles 83 and 84 set clear legal standards for judicial review of foreign-related awards, listing limited grounds for annulment or refusal of enforcement, such as lack of due process, ultra vires decisions, or violations of public policy.
Institutional Independence and Transparency
To ensure fair proceedings, the law reaffirms the independence of arbitration commissions from administrative agencies and requires internal governance structures to be clearly defined. As per Article 24, arbitration commissions are independent from administrative authorities and do not form hierarchical relationships among themselves.
Further, arbitration institutions must disclose operational information including rules, arbitrator rosters, fee standards, and annual reports, thereby enhancing transparency and public trust.
Diversification and Professionalization of Arbitrators
The revised law broadens eligibility for arbitrators, allowing professionals from law, economics, or science backgrounds, including qualified foreign nationals. Ethical standards have also been strengthened. Articles 21 and 50 make it clear that arbitrators must act impartially, diligently, and ethically. Those found guilty of misconduct, such as taking bribes, bias, or falsifying awards, will be removed from the arbitrator roster and may bear legal liability.
Court Support and Judicial Supervision
The revised law clarifies and reinforces the court’s supporting role. As per Article 39, when necessary to prevent award frustration or irreparable harm, a party may apply for property preservation or behavioral injunctions. The arbitration commission must refer such applications to the relevant people’s court, which is required to act in accordance with the Civil Procedure Law.
Additionally, Articles 71-74 deal with the annulment of arbitral awards. A party may apply to the intermediate people’s court where the arbitration commission is located to set aside an award within three months of receiving it (Article 72). Grounds for annulment include lack of arbitration agreement, violations of due process, or corruption and misconduct by arbitrators. The court must rule on the application within two months of accepting it (Article 73).
Similarly, Articles 75-77 govern the enforcement of awards. If the losing party fails to comply, the winning party may apply for judicial enforcement. The court may only refuse enforcement on limited statutory grounds, such as violation of public policy (Article 76). If an application to annul the award is filed simultaneously, the court must suspend enforcement until the annulment decision is rendered (Article 77).
Comment
The 2026 revision represents a major advancement in modernizing China’s arbitration system. By embracing online arbitration, expanding foreign engagement, and streamlining procedures, the law significantly enhances credibility, efficiency, and transparency. The revised law meets the growing need for dispute resolution under initiatives and strengthens China’s position as a global center for fair and efficient commercial arbitration.
China’s Arbitration Law was first enacted in 1994, and since its adoption, the law had only undergone one limited revision in 2017. The 2026 revision is the first full-scale overhaul in over 30 years, aiming to modernize China’s arbitration regime and align it more closely with international norms.
The following sections highlight the major changes and institutional innovations introduced in the revised Arbitration Law compared to the previous version.
Online Arbitration Proceedings and Legal Recognition
The revised Arbitration Law explicitly allows arbitration proceedings to be conducted via online platforms, provided that the parties have not expressly objected. According to Article 11 of the revised law, “With the consent of the parties, arbitration activities may be conducted online via an information network platform. Online arbitration activities have the same legal effect as those conducted offline.”
This legislative change reflects China’s response to the increasing digitization of legal services, especially in light of global trends toward online dispute resolution (ODR). It institutionalizes the practice that emerged during the COVID-19 pandemic and allows parties from different jurisdictions to arbitrate efficiently without being physically present.
Openness to Cross-Border Arbitration Activities
The revised law significantly liberalizes the cross-border operation of arbitration institutions. Under Article 86, Chinese arbitration commissions are permitted to establish business institutions outside the territory of China. Conversely, Article 86 (paragraph 2) allows foreign arbitration institutions to establish offices within certain areas in China, such as free trade zones or the Hainan Free Trade Port, with approval from the State Council, to conduct foreign-related arbitration activities in accordance with national regulations.
Strengthening the Legal Framework for Foreign-Related Arbitration
A dedicated chapter (Chapter VII) of the revised law addresses foreign-related arbitration. Article 81 allows parties to agree in writing on the place of arbitration, which will determine the applicable procedural law and the competent court for judicial supervision. In the absence of such an agreement, the arbitration seat shall be determined based on the arbitration rules or by the tribunal according to the principle of convenience.
The law also introduces flexible mechanisms for conducting ad hoc arbitration in China under certain circumstances. Article 82 stipulates that in disputes arising between entities registered in the Free Trade Zones or Hainan Free Trade Port, parties may choose arbitration in China by either institutional arbitration or an ad hoc tribunal composed of qualified personnel, subject to filing with the arbitration association.
Further, Articles 83 and 84 set clear legal standards for judicial review of foreign-related awards, listing limited grounds for annulment or refusal of enforcement, such as lack of due process, ultra vires decisions, or violations of public policy.
Institutional Independence and Transparency
To ensure fair proceedings, the law reaffirms the independence of arbitration commissions from administrative agencies and requires internal governance structures to be clearly defined. As per Article 24, arbitration commissions are independent from administrative authorities and do not form hierarchical relationships among themselves.
Further, arbitration institutions must disclose operational information including rules, arbitrator rosters, fee standards, and annual reports, thereby enhancing transparency and public trust.
Diversification and Professionalization of Arbitrators
The revised law broadens eligibility for arbitrators, allowing professionals from law, economics, or science backgrounds, including qualified foreign nationals. Ethical standards have also been strengthened. Articles 21 and 50 make it clear that arbitrators must act impartially, diligently, and ethically. Those found guilty of misconduct, such as taking bribes, bias, or falsifying awards, will be removed from the arbitrator roster and may bear legal liability.
Court Support and Judicial Supervision
The revised law clarifies and reinforces the court’s supporting role. As per Article 39, when necessary to prevent award frustration or irreparable harm, a party may apply for property preservation or behavioral injunctions. The arbitration commission must refer such applications to the relevant people’s court, which is required to act in accordance with the Civil Procedure Law.
Additionally, Articles 71-74 deal with the annulment of arbitral awards. A party may apply to the intermediate people’s court where the arbitration commission is located to set aside an award within three months of receiving it (Article 72). Grounds for annulment include lack of arbitration agreement, violations of due process, or corruption and misconduct by arbitrators. The court must rule on the application within two months of accepting it (Article 73).
Similarly, Articles 75-77 govern the enforcement of awards. If the losing party fails to comply, the winning party may apply for judicial enforcement. The court may only refuse enforcement on limited statutory grounds, such as violation of public policy (Article 76). If an application to annul the award is filed simultaneously, the court must suspend enforcement until the annulment decision is rendered (Article 77).
Comment
The 2026 revision represents a major advancement in modernizing China’s arbitration system. By embracing online arbitration, expanding foreign engagement, and streamlining procedures, the law significantly enhances credibility, efficiency, and transparency. The revised law meets the growing need for dispute resolution under initiatives and strengthens China’s position as a global center for fair and efficient commercial arbitration.