Germany is in the process of renewing its arbitration law, which in its current version dates from 1997. In April 2023, the German Federal Ministry of Justice (the "Ministry") published a Key Issues Paper, identifying potential areas of improvement of Germany's current arbitration law. After extensive feedback and discussion in the German arbitration community, the Ministry has now followed up with a Draft Bill for the Modernization of the German Arbitration Law (the "Draft Bill").

The Draft Bill aims to improve the efficiency of arbitral proceedings conducted in Germany and strengthen Germany's position as an international arbitration venue. Among other things, the Draft Bill seeks to make use of technological advancements and respond to recent national reforms in neighboring European countries, including Switzerland and Austria. The reception of the Draft Bill has been overwhelmingly positive, as reflected in feedback the German Arbitration Institute ("DIS") has collected from its 1,500 members.1

The Draft Bill contains several significant changes to Germany's current arbitration law, which are summarized below.

Freedom of form for arbitration agreements. Section 1031 of the German Code of Civil Procedure ("Zivilprozessordnung" or "ZPO") currently requires that arbitration agreements must be concluded in writing. The Draft Bill abolishes this requirement for commercial transactions. As such, the Draft Bill (re-)introduces the possibility for arbitration agreements in commercial transactions to be concluded orally.

German arbitration law in force prior to 1933 already provided for freedom of form in arbitration agreements and allowed for such agreements to be concluded orally. This was later abandoned, in line with the 1985 UNCITRAL Model Law on International Commercial Arbitration, which required written evidence of arbitration agreements. However, the 2006 revision of the UNCITRAL Model Law has since abandoned the requirement for a written arbitration agreement. The Draft Bill therefore seeks to bring Germany's arbitration law in line with the current UNCITRAL Model Law.

Although the abolishment of form requirements for arbitration agreements provides appropriate flexibility, it has been criticized because of the inevitable difficulties associated with proving the existence of an oral arbitration agreement.2 Similarly, critics have invoked concerns about the enforceability of such arbitration agreements as Article II(1) of the New York Convention requires a written arbitration agreement.

However, the experience in other jurisdictions that have adopted the 2006 UNCITRAL Model Law on this point largely reveals these concerns as overstated. Leaving aside that the New York Convention imposes minimum standards which permit contracting states to adopt a more liberal regime, there is no evidence that dispensing with form requirements for an arbitration agreement makes them less likely to be enforced. In addition, implementing the proposed amendments of the Draft Bill also has the advantage of increasing uniformity across German law: pursuant to Section 38(1) of the ZPO, choice of court agreements can be concluded without any formal requirements. There appears to be no good reason why arbitration agreements should be treated differently.

Joint appointment of co-arbitrator in multi-party arbitrations. Currently, Germany's arbitration law does not contain provisions on multi-party proceedings. The Draft Bill proposes to change that and introduces a new Section, 1035(4) ZPO, which provides that in multi-party arbitration proceedings, a co-arbitrator must be jointly appointed by all relevant parties on one side (e.g., jointly by all claimants). According to the proposed amendment, if the "joined parties" fail to reach an agreement within one month, the competent court at the seat of the arbitration will appoint the co-arbitrator upon request.

The proposed provision addresses the practical challenge in multi-party arbitrations that all parties must have an equal say in the appointment of their co-arbitrator, while also ensuring that disagreements about the appointment among different parties on one side do not stall progress of the proceedings. Conferring the power to appoint a co-arbitrator to the competent court in case of disagreements between the parties mirrors the position taken in Austria and Switzerland.3 Nevertheless, it is worth noting that this rule is subject to the parties agreeing otherwise, and so likely to be of limited practical importance: in the case of institutional arbitration, it will be overridden by the applicable arbitration rules, which often foresee for the appointment of a joint co-arbitrator to be made by the arbitral institution or else provide for an alternative appointment process for the constitution of a tribunal in a multi-party scenario altogether.

Challenging procedural arbitral awards in the event of a negative decision on jurisdiction. Proposed Section 1040(4) ZPO of the Draft Bill addresses a lacuna in Germany's current arbitration law by permitting state courts to review arbitral awards in which the tribunal declines jurisdiction. While such a review is already possible in case of a partial award that assumes jurisdiction, the opposite is not currently true. Instead, as the law stands today, negative jurisdictional decisions cannot be reviewed by state courts as none of the grounds for annulment under Section 1059(2) of the ZPO apply to an arbitral award that declines jurisdiction. Thus, even if fundamentally flawed in its reasoning, a negative jurisdictional award inevitably forces parties to litigate before state courts instead of arbitration, even if they had clearly intended their dispute to be subjected to arbitration.

Some authors have criticized the Draft Bill for introducing further state court review, which they consider incompatible with the notion that, in principle, an arbitral tribunal's decision should stand and be complied with by the parties, even if incorrect on substance.4 In reality, however, the proposed rule is arbitration-friendly: if an arbitral tribunal renders an award in which it wrongly declines jurisdiction, a state court may correct that decision and send the case back to arbitration, where it belongs. In addition, the proposed rule fosters consistency by treating positive and negative jurisdictional decisions identically. It also harmonizes approaches internationally: Austria is a notable example of another jurisdiction that provides for review of negative jurisdictional decisions.5

Enforcement of interim measures issued by foreign arbitral tribunals. The proposed amendments to Sections 1041(2) and 1025(2) of the ZPO in the Draft Bill provide for the enforcement of interim measures made by arbitral tribunals seated outside of Germany through German courts. As the law stands today, there is considerable uncertainty about whether interim measures issued by foreign arbitral tribunals are subject to state court enforcement in Germany. Proposed Section 1041(2) therefore sets out the procedure for a court order permitting enforcement of interim measures. Implementing this provision would allow German arbitration law to catch up with its Austrian and Swiss counterparts, where the enforcement of interim measures by foreign arbitral tribunals has long been established.6

Remote hearings and e-awards. The Ministry's Key Issues Paper did not raise the question as to whether the new German arbitration law should include provisions on the possibility to conduct arbitration hearings remotely by video link or to sign arbitral awards electronically. Given widespread discussion on these issues in legal commentary (including by Professor Dr. Maxi Scherer and Dr. Ole Jensen, whom the Draft Bill cites in this regard),7 the Draft Bill now contains corresponding provisions.

Proposed Section 1047(2) sentence 1 of the ZPO provides the clarification that arbitral tribunals may conduct arbitral hearings by video link even in cases where one of the parties objects to such a "remote hearing." At the outset of the COVID-19 pandemic, some commentators considered only in-person hearings to constitute "oral hearings" in the sense of Section 1047 of the ZPO and thus took the view that remote hearings cannot be imposed upon the parties if one party – often for tactical reasons – objects to holding the hearing remotely.8 This view is incompatible with the reality of many successful remote hearings conducted during and after the COVID-19 pandemic. Accordingly, several arbitral institutions and supreme courts in different jurisdictions have since clarified that remote hearings are permissible, even if one party objects to them, as long as fair and equal treatment of the parties is maintained.

Furthermore, proposed Section 1054(2) of the ZPO introduces the option to render arbitral awards electronically without a hardcopy original. Such an "e-award" will need to include the names of all tribunal members and their qualified electronic signatures. A qualified electronic signature as defined by the Draft Bill will be created by using a "qualified electronic signature creation device" and authenticated by a "qualified certificate for electronic signatures." These requirements are based on the European Union's eIDAS Regulation. The eIDAS Regulation establishes a legal framework for recognizing electronic signatures in civil proceedings by equating them with handwritten signatures. While thus common in European jurisdictions, it is doubtful whether arbitrators domiciled outside the European Union are familiar with eIDAS signatures and possess the means to produce them.

The parties have the right to object to the issuance of an e-award and instead request an award in paper form. Parties will often wish to do so, given that a qualified electronic signature may not be sufficient in other jurisdictions to allow for enforceability of the award. However, the proposed amendment represents a significant advancement in the digitalization of arbitration legislation. It also harmonizes the legal status of arbitral awards with that of court judgments and orders (which in Germany can be rendered electronically), and indeed with a handful of other jurisdictions that have already introduced e-awards.9

Publication of arbitral awards. Another novel suggestion in the Draft Bill is the publication of redacted arbitral awards with the parties' consent as per the new Section 1054b of the ZPO. This amendment aims to foster transparency and trust in arbitral proceedings while contributing to the development of the law. Although Germany's current arbitration law does not prohibit the publication of arbitral awards with the agreement of the arbitral tribunal and parties, this option has been rarely used.10Among other things, concerns over inadequate redactions and potential identification of parties have hindered its practical implementation. The amendment encourages parties to consider publication, facilitating broader discussions on legal matters and enhancing legal clarity and consistency. Parties may object to anonymized or pseudonymized publication within one month, ensuring a balanced approach to transparency and confidentiality.

The proposed provision is a response to increased criticism that the prevalence of arbitration to resolve disputes in certain areas – such as post-M&A disputes – prevents the development of the law in those areas.11 The publication of arbitral awards would ensure that the application of those principles becomes public such that academic debate can ensue – as it has in the context of investor-state arbitration. On the other hand, publication of an award must always remain in the parties' discretion, who may have opted for arbitration based on the privacy it promises.

Dissenting opinion. The Draft Bill further proposes a new Section 1054a of the ZPO which expressly permits an arbitrator to voice disagreement with the arbitral award or its reasoning by rendering a dissenting opinion. This somewhat curious provision – which does not appear to be contained in any other arbitration law around the world – can be traced back to a 2020 obiter dictum by the Higher Regional Court of Frankfurt am Main. In that decision, the court insinuated that a dissenting opinion might violate the secrecy of deliberations and thus lead to the annulment of the award to which it is appended. The court's obiter has been met by near unanimous criticism from German commentators.12 Given that dissenting opinions typically address the substance of the majority decision without giving away anything about the tribunal's deliberations, and given they are commonplace internationally, there does not appear to be much doubt as to the permissibility of dissenting opinions. The proposed amendment therefore simply clarifies that dissenting opinions are permissible in German arbitrations.

Request for retrial of the case. Proposed Section 1059a of the ZPO introduces an entirely novel legal remedy that allows for the setting aside of arbitral awards which have become final and can no longer be challenged under conditions like those of an action for retrial. To pursue this application, a party must substantiate one of the valid causes for retrial under Section 580 of the ZPO, such as the other party's commission of perjury on a statement forming the basis of the award, or forgery of a document on which the award relies. This amendment once again aims to achieve conformity between arbitration proceedings and state court proceedings. While arguably of limited practical importance, a recent English case demonstrates that even in high-stakes cases fraudulent behavior can impact an arbitral award. Introducing a dedicated statutory provision addressing fraudulent awards further strengthens the legitimacy and credibility of arbitration as a dispute resolution mechanism in Germany.

Jurisdiction of German Commercial Courts and submission of English-language documents in arbitration-related court proceedings. Proposed Section 1062(5) sentence 2 of the ZPO broadens the jurisdiction of German Commercial Courts to encompass arbitration-related court proceedings, which in turn intends to expedite the resolution of disputes through the specialized expertise of the Commercial Courts.

Similarly, proposed Section 1063b(1) of the ZPO allows parties to submit arbitral awards and documents in proceedings before the Commercial Courts in English. Given the prevalence of English in international arbitrations, this new rule significantly reduces the resources otherwise required for translation of documents.

Emergency arbitration. While the Ministry's Key Issues Paper considered a provision on emergency arbitration, the Draft Bill has not picked up this idea.

Concentration of arbitration matters before certain higher regional courts. A further proposition included in the Key Issues Paper would have concentrated the jurisdiction of arbitration matters to only a few select German higher regional courts. This change would have led to a welcome specialization and accumulation of expertise at those courts, as is the case with the Swiss Federal Tribunal and the Austrian Supreme Court. However, the Draft Bill does not contain corresponding provisions.


The proposed amendments in the Draft Bill aim to modernize German arbitration law. By allowing informal arbitration agreements, recognizing qualified electronic signatures on awards, and facilitating the submission of English-language documents, Germany demonstrates its commitment to adapting to contemporary commercial practices and international standards. With other measures, such as a statutory provision on the publication of arbitral awards, Germany aims to set new standards that have not yet been adopted in other jurisdictions. Overall, the Draft Bill paves the way for a legal arbitration framework that is both more efficient and makes responsible use of technological advancements.

The Group has had a long-standing focus on arbitration in Germany, Switzerland and Austria, and counts more than a dozen German-speaking arbitration specialists in its ranks.


1. See DIS, Statement on the Draft Bill of the Federal Ministry of Justice for the Modernisation of Arbitration Law.

2. On this criticism, see DIS, Statement on the Draft Bill of the Federal Ministry of Justice for the Modernisation of Arbitration Law, at p. 2.

3. See Section 587(5) of the Austrian Code of Civil Procedure; Article 179(5) of the Swiss Private International Law Act.

4. See DIS, Stellungnahme zum Referentenentwurf des Bundesministeriums der Justiz eines Gesetzes zur Modernisierung des Schiedsverfahrensrechts, at p. 4.

5. Section 611(2)(1) of the Austrian Code of Civil Procedure.

6. See Sections 577(2) and 593(3) to (6) of the Austrian Code of Civil Procedure; Article 185a(1) of the Swiss Private International Law Act.

7. See Scherer and Jensen, 'Die Digitalisierung der Schiedsgerichtsbarkeit' in Riehm and Dörr (eds), Digitalisierung und Zivilverfahren 591, 610-620 (De Gruyter 2023).

8. See, e.g., Münch in Münchener Kommentar, Section 1047, at para. 9 (Beck, 5th ed. 2017); Lachmann, Handbuch für die Schiedsgerichtspraxis, at para. 1588 (Otto Schmidt, 3rd ed. 2008).

9. Article 1072 of the Dutch Code of Civil Procedure; Article 41 (6) of the Arbitration Law of the United Arab Emirates.

10. For a notable exception, see S. Elsing, G. Pickrahn, K. Pörnbacher & G. Wagner, M&A-Streitigkeiten vor DIS-Schiedsgerichten, 2022.

11. See, e.g., beck-aktuell, Ergebnisse der 67. Jahrestagung der Präsidenten der OLG, des KG und des BGH, dated 25 June 2015, becklink 2000386.

12. See, e.g., Bickmann and Wagner, 'Das Sondervotum (dissenting opinion) im deutschen Schiedsverfahrensrecht', GWR 2020, 295; Hochstrasser and Sunaric, 'Dissenting Opinion – Weder Ärgernis noch Torheit', SchiedsVZ 2021, 35.

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