China's Revised Arbitration Law 2026: A Guide for Foreign Parties

China's Arbitration Law has governed commercial arbitration in the mainland since 1994, largely unchanged while the disputes it governs grew steadily more cross-border. That changes now. On 12 September 2025 the Standing Committee of the National People's Congress passed the first comprehensive revision of the law; it was promulgated the same day by Presidential Order No. 54 and takes effect on 1 March 2026. The amended law runs to eight chapters and 96 articles. For a foreign party, the useful way to read it is in three questions: what changed, what did not, and what still needs the courts to settle.

What actually changed for foreign parties

The revision makes several long-debated concepts explicit. The "seat" of arbitration is now written into the statute (Article 81). Ad hoc arbitration — historically impossible in mainland China — is introduced in a deliberately narrow form (Article 82). Foreign arbitration institutions may set up offices and conduct foreign-related arbitration within the pilot free trade zones and the Hainan Free Trade Port (Article 86). An arbitration agreement can now be "deemed" to exist where a party asserts it and the other side does not deny it before the first hearing (Article 27). The tribunal itself joins the institution and the court as a body that can decide challenges to the validity of the arbitration agreement (Articles 30 and 31), and conduct preservation — an order that a party do or refrain from doing something — is added alongside property and evidence preservation (Article 39). What did not change is the recognition-and-enforcement route: an award made in China can still be taken abroad, and a foreign award is still recognised and enforced through the New York Convention or reciprocity (Articles 85 and 88).

The seat of arbitration is now written down

Article 81 codifies the concept that common-law systems take for granted: the parties may agree in writing on the seat of arbitration. Unless otherwise agreed, the seat determines the law applicable to the arbitral procedure and the court with jurisdiction over the arbitration, and the award is deemed to be made at the seat. Where the parties have not agreed, the seat follows the agreed arbitration rules, and if those rules are silent, the tribunal determines it. The practical value is characterisation: for an award with a China nexus, the seat rule clarifies where the award is "made", which is exactly the fact that matters when a party later seeks recognition and enforcement under the New York Convention. It does not change the Convention's operation, but it makes the domestic side of the analysis more predictable.

Ad hoc arbitration: real, but narrowly fenced

The most discussed change is the introduction of ad hoc arbitration — proceedings run without an administering institution. Article 82 restricts it to two categories of foreign-related disputes: foreign-related maritime disputes, and foreign-related disputes between enterprises registered in a pilot free trade zone, the Hainan Free Trade Port or other areas designated by the state. Several conditions apply: the parties must agree in writing to arbitrate and may agree that the seat is in China; the tribunal must be composed of persons who meet the statutory qualifications; the proceedings follow the agreed arbitration rules; and the tribunal must file the parties' names, the seat, the tribunal's composition and the applicable rules with the Arbitration Association within three working days of its formation. Applications for interim measures in an ad hoc arbitration go through the court. In short: ad hoc arbitration exists, but it is a zoned, foreign-related exception, not a general licence.

Foreign institutions, but only in the zones

Article 86 permits foreign arbitration institutions to establish business offices and conduct foreign-related arbitration activities within the pilot free trade zones and the Hainan Free Trade Port, in accordance with the relevant state regulations — and it encourages Chinese institutions to open offices abroad in return. The geographic limit matters: this is not national liberalisation. A foreign institution can administer a China-seated foreign-related arbitration in the zones, but elsewhere the default remains institutional arbitration through established Chinese bodies such as CIETAC, or a foreign seat chosen in the agreement.

Agreement, competence and interim measures

Three procedural changes are worth knowing before you draft. First, Article 27 keeps the written-form requirement but adds a deemed-agreement rule: if one party asserts that an arbitration agreement exists and the other party does not deny it before the first hearing, and the tribunal records the exchange, an arbitration agreement is deemed to exist — a rule that protects parties who exchange a defective clause but behave as if it bound them. Second, Articles 30 and 31 let the tribunal, alongside the arbitration institution, decide an objection to the validity of the arbitration agreement, with the court still able to make a prior determination. Third, Article 39 adds conduct preservation — an order to do or refrain from doing something — to the existing property and evidence preservation, and allows an urgent pre-arbitration application to the court. For a party facing a counterparty moving assets or continuing an infringing act, that is a meaningful strengthening.

The New York Convention route is unchanged

Nothing in the 2026 revision reopens the enforcement channel. Article 85 confirms that an award made in China may be applied to a foreign court for recognition and enforcement, and Article 88 preserves the long-standing rule that a foreign award is applied for directly to the intermediate people's court at the debtor's domicile or where its property is located, and is dealt with under the New York Convention or reciprocity. The revision refines the domestic machinery around that channel; it does not alter the channel itself. Our separate note on enforcing foreign arbitral awards in China walks through that process in detail.

Transition: what the law does not say

The new law takes effect on 1 March 2026 and contains no dedicated transitional provision telling you how arbitration agreements concluded before that date should be treated. The prudent position is to treat pre-amendment agreements and pending matters as governed by the law in force when they were made, and to confirm the position against the latest official rules and any judicial interpretation that follows — the Supreme People's Court has yet to issue its guidance on the transition. If you are drafting now, draft against the 2026 text: specify the seat, name your institution or use an approved ad hoc route consciously, and keep the New York Convention enforceability of the eventual award in mind from the first clause. Our practice note on forum-selection and jurisdiction clauses in China covers the sibling question of litigation clauses, and our dispute resolution team advises on both sides of the clause.

The 2026 Arbitration Law is best understood as a modernisation that confirms China's place in international arbitration while keeping its institutions central. The seat is now explicit, ad hoc arbitration is real but zoned, and the Convention route is untouched. For a foreign party, the message is the same as ever, now with better statutory support: the arbitration clause is where the outcome is decided, so draft it carefully and enforce what it gives you.