UK litigation in 2026: Key developments and issues to watch

Key reforms and litigation trends expected to shape the year ahead

As the litigation landscape moves into 2026, a number of developments are expected to shape how disputes are funded, managed and resolved. Judicial decisions, regulatory reviews and legislative changes underway at the close of 2025 point to continued evolution across collective actions, arbitration and open justice.

1. Collective Actions and Litigation Funding Under Review

The UK’s collective actions regime has entered a period of transition, with increasing scrutiny of how opt-out proceedings are funded and controlled. Developments during 2025 reflected sustained judicial and regulatory focus following the PACCAR decision on litigation funding agreements. In June, the Civil Justice Council published its final report on third-party litigation funding, recommending light-touch regulation, enhanced judicial oversight and legislative reversal of PACCAR. The Ministry of Justice has since confirmed its intention to introduce legislation to overturn PACCAR when parliamentary time allows, while continuing to consider the Council’s remaining recommendations.

Separately, marking the tenth anniversary of the opt-out collective actions regime for competition damages claims, the government launched a call for evidence to assess its effectiveness. The review signals potential reform aimed at preserving access to justice while addressing concerns over speculative litigation. The call for evidence closed on 14 October 2025, with any proposals for change expected to be subject to further consultation.

2. Large-Scale Group Litigation Continues to Test Case Management

In Various Claimants v Mercedes-Benz Group AG, Ford Motor Company, Nissan Motor Co Ltd, Stellantis NV and others [2025] EWHC (Comm), commonly referred to as the “Dieselgate” or Pan-NOx litigation, the High Court is overseeing one of the largest consumer group actions in English legal history. The proceedings involve more than 1.6 million claimants and allegations concerning the use of unlawful “defeat devices” to manipulate vehicle emissions tests.

With major liability and quantum trials listed through 2026, the court has already subjected costs and case management arrangements to close scrutiny, resulting in reductions exceeding half to ensure proportionality and efficiency. The litigation now stands as a prominent example of how English courts manage complex, multi-defendant consumer and environmental claims, alongside other large group actions such as Município de Mariana and others v BHP Group (UK) Ltd [2025] EWHC (TCC).

3. Arbitration Act 2025 Brings Structural Reform

The Arbitration Act 2025 introduces significant updates to the Arbitration Act 1996, addressing long-standing areas of uncertainty. The legislation establishes a default rule that the governing law of an arbitration agreement is the law of the seat, unless the parties expressly agree otherwise. It also introduces a statutory power allowing tribunals to issue summary awards where a claim or defence has no real prospect of success.

In addition, the Act narrows the scope of de novo jurisdiction challenges under section 67 and delivers a broader modernisation of the arbitration framework. As a result, parties and practitioners are expected to pay closer attention to arbitration clause drafting and procedural strategy in 2026.

4. Expanded Public Access to Court Documents

From 1 January 2026, a two-year pilot scheme under Practice Direction 51ZH will take effect in the Commercial Court and Financial List. The scheme provides for public access to certain documents used in open hearings, including skeleton arguments, written submissions, witness statements, expert reports and materials deemed critical to understanding proceedings.

The pilot marks a significant step in open justice reform, shifting the default position from applications by non-parties to proactive public filing. Its introduction is expected to have practical and strategic implications, requiring parties to manage confidentiality risks and consider the impact of increased transparency on case strategy and settlement decisions.