Major Contents and Significance of the Comprehensive Revision of China's Arbitration Law (2025)

Abstract

The 2025 comprehensive revision of the Arbitration Law of the People’s Republic of China represents one of the most significant legislative reforms in China’s external legal governance since the era of reform and opening-up. Rather than a mere technical amendment, the revision constitutes a strategic legislative response to the challenges of a global environment marked by the coexistence of globalization and de-globalization. This study analyzes the legislative background, key provisions, institutional innovations, and politico-legal implications of the reform, examining how China has sought to reconcile the dual objectives of embracing international norms and safeguarding national sovereignty. The paper first situates the reform within its domestic and international contexts. Domestically, sustained economic growth, the rapid expansion of the digital economy, and rising demand for efficient dispute resolution created structural pressure to modernize the arbitration regime. Internationally, the intensification of U.S.–China strategic competition, the growing rivalry among major arbitration hubs such as Singapore and Hong Kong, and the evolution of the UNCITRAL Model Law on International Commercial Arbitration collectively prompted the overhaul of a thirty-year-old legal framework. The reform was also informed by policy initiatives such as the State Council’s 2018 Opinions on Improving Arbitration Credibility and Efficiency, pilot projects for international commercial arbitration centers, and coordinated consultations between judicial and legislative organs. The new Arbitration Law, retaining its eight-chapter structure and expanding to 96 articles, achieves six major institutional innovations. First, it codifies the principle of good faith, thereby strengthening procedural integrity and the duty of cooperation. Second, it defines arbitration commissions as non-profit legal entities and introduces board-based governance to reduce administrative dependency. Third, it clarifies arbitrators’ qualifications and obligations, imposing restrictions in cases of conflicts of interest or concurrent public office. Fourth, it modernizes the arbitration agreement system by incorporating implied consent and the doctrine of separability, aligning with international standards. Fifth, it promotes procedural digitization through online arbitration, electronic service, and digital signatures. Sixth, it refines judicial assistance and supervision by specifying procedures for evidence collection, property preservation, and injunctions. A particularly noteworthy reform lies in the structural transformation of foreign-related arbitration. The revised law adopts the concept of the seat of arbitration, unifying the choice of procedural law and jurisdiction under internationally recognized criteria. It further legalizes ad hoc arbitration in maritime and free trade zones, permits Chinese arbitration institutions to establish overseas offices, and allows foreign institutions to open branches within China’s free trade zones. These measures institutionalize openness and reflect China’s intention to engage more actively in shaping global arbitration norms. At the same time, the reform demonstrates a cautious and defensive legislative posture. To protect national interests amid de-globalization, Article 5 introduces a new proviso—“unless otherwise provided by law”—empowering Chinese courts to retain jurisdiction in cases involving foreign sanctions. This connects the Arbitration Law more closely with the Anti-Foreign Sanctions Law. The amendment also introduces provisions against sham arbitration and expands judicial control over awards that contravene public policy or national interests. Such measures illustrate the institutional duality of openness and protection that characterizes the reform. Ultimately, the 2025 revision embodies the dialectical modernization of legal governance in China. By embracing international norms, it enhances the credibility and competitiveness of Chinese arbitration, while simultaneously embedding defensive mechanisms to manage geopolitical and systemic risks. The new Arbitration Law thus represents not only a milestone in institutional modernization but also a declaration of how China envisions a balance between the universality of international legal norms and the particularity of “Chinese rule of law.”