Reforming Section 67: A New Era for Jurisdictional Challenges

The overhaul of Section 67 of the Arbitration Act 1996 (“AA 1996”) is one of the most significant reforms introduced by the Arbitration Act 2025 (the “AA 2025”). Section 67 governs challenges to an arbitral award based on a tribunal’s lack of substantive jurisdiction. While the right to bring such a challenge remains unchanged, the AA 2025 narrows the grounds for appeal, reshapes the court’s powers, and most importantly replaces the long criticised de novo rehearing process with a more streamlined approach.

Enhanced and Clarified Grounds for Challenge

Under Section 67 of the AA 1996, a party which challenged a tribunal’s jurisdiction (successfully or unsuccessfully) in the arbitration would be able to challenge the tribunal’s jurisdiction de novo with an appeal to the Court. The Court would have the last say on jurisdiction, dealing with questions of fact and law. Thus, a party could re-argue its case on jurisdiction in front of a court, effectively leading to a re-trial rather than merely a judicial review. 

Under the revised Section 67, the parties are now prevented from raising jurisdictional objections before the Court if they failed to raise them before the tribunal, unless they can show they did not and could not reasonably have known of them earlier. The Court may hear late raised grounds only where the interests of justice require it. This change is designed to prevent tactical ambushes and promote procedural efficiency.

Expanded but Structured Court Powers

The Court retains broad powers to confirm, vary, remit or set aside an award, or to declare it of no effect. However, the Court may now only set aside an award or declare it ineffective if it determines that remission to the original tribunal would be inappropriate. This reflects a strengthened emphasis on respecting tribunal autonomy and promoting finality.

A New Approach to Hearings: The End of Dallah

Under Dallah v Pakistan, the landmark 2010 Supreme Court decision, Section 67 applications led to a full rehearing of the jurisdictional challenge. Courts routinely heard fresh evidence, witnesses were recalled, and tribunals’ findings carried no weight. This approach was consistently reaffirmed, including in GPF Sarl v Poland and Gold Pool v Kazakhstan, where the courts treated jurisdictional challenges as starting “from scratch.”

The AA 2025 reverses Dallah. Courts will now review Section 67 challenges based primarily on the material that was before the tribunal. New evidence will only be permitted if the applicant could not, with reasonable diligence, have presented it earlier. Again, this is subject to the interests of justice test. 

The old de novo Section 67 re-hearings were slow and costly, sometimes taking over a year and requiring witnesses to be recalled, undermining arbitration’s efficiency and finality. They also raised fairness concerns, effectively giving parties a “second attempt” to refine their case, a risk highlighted in Trading Exports Limited v Fioralba Shipping Co.[1]

While Section 67 challenges remain rare, occurring in less than 0.5% of English-seated arbitrations, the above changes will be significant for those affected. The new framework strengthens tribunal authority, enhances procedural rigour, and aligns the UK’s arbitration regime with international expectations for efficiency and finality, ensuring that London remains a world leading arbitral seat.