Regulating Third Party Funding in Arbitration After PACCAR by Dr Caroline Kenny KC and Arran Dowling-Hussey
The July 2023 UK Supreme Court decision in R (PACCAR Inc and others) v Competition Appeal Tribunal created significant uncertainty around the regulation of third-party funding.
The UK Government has announced steps toward regulation - a development that:
• Brings greater certainty to the market
• Reinforces London’s position as a leading seat for ADR, in line with other key jurisdictions
• May signal the path toward wider European regulation in the future
In their Spring 2026 commentary, Dr Caroline Kenny KC and Arran Dowling-Hussey welcome the move, noting:
“As the funding industry has been regulated in Hong Kong and Singapore since 2017 in relation to international arbitrations, it is arguably time for England to introduce legislation as well. The industry provides an important service to users of arbitration and uncertainty about the enforceability of such agreements is unsatisfactory and provides a disservice to arbitration users. It is unfortunate that the recent ' King's Speech did not follow up on the earlier announcement but we would be hopeful that this legislation will be introduced.'
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Members of 4-5 Gray’s Inn Square’s Arbitration Group advise and act in ICC and other institutional and ad hoc arbitrations, including construction, engineering, insurance, and commercial disputes.’
